Stocks Pump’n’Dump As Stimulus Hopes (& The Dollar) Slump

The Dollar tumbled intraday, ending the 4-day win streak and biggest surge since March…

Stocks hit session highs on speculation that talks about a new round of economic stimulus will resume amid growing concern over a resurgence in coronavirus cases around the world. Then reversed on reports that “no talks” were scheduled between Mnuchin and Pelosi. A record daily surge in COVID cases in France didn’t help…

Or visualized a different way…

Small Caps bounced off 200DMA (but then retraced back below it), Dow bounced off 100DMA at the open…

The S&P 500 broke down into the red for 2020 today (below 3230.78) but the machines made sure it closed above it…

Election uncertainty pushed higher once again…

Despite Oil’s modest gains, XOM slipped lower, pushing its dividend yield above 10% once again!…

As Bloomberg notes, the world’s second-biggest oil explorer by market value has pledged to defend the payout, which has increased for 37 consecutive years, but stubbornly low crude prices have meant a reliance on borrowed money to fund it.

SPACs were spanked (after SEC concerns)…

Or visualized a different way…

Momo’s short-term run against value appears to have its upper limit once again…

Treasury yields remained in an insanely narrow range once again (10Y yields traded inside a 2bps range today). On the week, 30Y is down around 5bps, 2Y unch…

Driving Bond vol (MOVE) back down to record lows (the biggest divergence from VIX in over 30 years)…

Real yields pushed higher again…

Turkish Lira screamed higher on the back a surprise rate hike (first since 2018)…

Bitcoin managed some decent gains as the dollar sank today…

Silver rebounded during the US day session, getting back above $23…

WTI pushed back above $40 as the dollar weakened…

Gold/Silver reversed lower today (after a notable spike in the last few days)…

Finally, in case you were wondering if it’s over yet? @BearTrapsReport notes that one rule of thumb we learned years ago – when you see a 3% drawdown, they only rarely happen alone, they often come as a cluster. The Nasdaq fell -3.1% on Wednesday, underperforming the other major US indices.

Looking at all of the -3% Nasdaq drawdowns over the past decade, a trend is clear… Large drawdowns come in clusters, they are rarely isolated events. With every big drawdown we see, there is an increased probability we see another one.

Trade accordingly.

Via https://www.zerohedge.com/markets/dollar-dumped-spacs-spanked-silver-surged-bond-volatility-hits-record-lows