Try as it may, the S&P 500 is finding it difficult to stay above that critical 2,800 level. In Tuesday’s trading session, the benchmark index made another run above 2,800 intraday, but much like Tuesday it sold off into the closing bell. Chairman Jerome Powell will continue with his testimony before Congress today and after…
Volatility Review 19 February 2019 Equity Derivatives Strategy Bram Kaplan, CFA AC, Marko Kolanovic, PhD Positioning update, RTY and NDX structured product issuance & dynamics, trading commodity sectors Despite the remarkable V-shaped market recovery since December, equity positioning remains light across systematic and macro investors. CTAs, Volatility Targeting portfolios and Hedge Funds’ equity exposure…...
It was a huge day of VIX trading on Monday with VIX options and futures volume soaring. The bottom line is that hedging programs were deployed on scale given the relative low level/inexpensive hedges that could be afforded and with the S&P 500 achieving the 2,800 level intraday. Most of the hedging activity and upside…
Welcome to Finom Group’s technical market recap! In this weekend’s release, we run through Friday’s market activity with great commentary and analysis from our very own Wayne Nelson. Please click on the link to review the video, which is 38 minutes in duration. If you are new to finomgroup.com, please feel free to subscribe…
It’s not often that such a market rally, now nearly 2 months in the making, can frighten investors, but this particular rally has served to uncover some strange happenstance when we look under the hood. With the FOMC/Fed on the sidelines and a China/U.S. trade deal seemingly on the horizon, the market fundamentals will eventually…...
Why rising rates and a flatter curve signal a potential downturn: The U.S. economy has seen a prolonged period of growth without a recession. As the business cycle has matured, the U.S. yield curve has flattened substantially. We expect further flattening and an increasing likelihood of curve inversion as the Federal Reserve continues to raise interest rates. Historically, an inverted yield curve has been a…...
Educational video on the yield curve and its many implications. Discusses the yield curve as an indicator of strength or weakness of the economy. How the Federal Reserve’s activity affects the yield curve vs. how investors affect the yield curve i.e. supply/demand....
Welcome to this weekly edition of State of the Market. The major averages succumb to modest selling pressure today, even with headlines and media coverage surrounding U.S./China that support a deal forthcoming. Please click the following link to review the SOTM video, which is roughly 1 hour in duration. Additionally, Wayne Nelson delivers our daily,…
Despite it being a QT day of significance and without the benefits of U.S. Treasury issuance offsets, the major averages still rallied and after the FOMC minutes were released. The minutes proved innocuous by and large, inline with what most economists, strategists and analysts had previously assumed. The assumption was that there would be some…
There is at least one key component of the market rally that will likely come into play today, liquidity. Today marks yet another quantitative tightening (QT) day for the FOMC as it continues to reduce the size of its balance sheet. The calendar of QT days is depicted below. It’s a common and widely accepted…
