"Buying Panic" Lifts Stocks Green Post-QE Amid Gold's Best Week Since Oct 2011
Despite massive volatility and turmoil this week, today's bounce in crude and stocks is all anyone remembers... so!
But - in reality - it was total chaos...
- Silver - best week since Aug 2013
- Gold - best week since Oct 2011
- WTI Crude - first positive week in last 8 weeks
- S&P 500 - worst week in last 5 weeks
- VIX - Highest weekly close since Dec 2012
- Treasury Yields - 3rd weekly drop in a row to new record for 30Y
- EURUSD - worst week since Jul 2012
- CHFUSD - best week ever ever ever
Year-to-date... Silver and Gold the leaders (followed by bonds) with Stocks and Oil the laggards...
The week in stocks...
And an almost perfect roundtrip from yesterday's open...
And today's exuberant-fest thanks to fun-durr-mentals
Total buyingh panic rampfest today just managed to get stocks green post-QE...
Homebuilders were the week's biggest loser, Energy rebounded on oil price's dead cat bounce (despite Energy credit's record high closing spread at 1058bps)
Just as an FYI - the manipulation and tinkering is becoming so obvious and widespread as the following chart shows - average trade size of S&P 500 e-minis is now at a record low 2.7 contracts!!!! All machines all the time....
The ever shrinking average trade size in the eMini $ES_F - currently at a record low 2.7 contracts pic.twitter.com/DN7zLmpFdb
— Eric Scott Hunsader (@nanexllc) January 16, 2015
Treasury yields plunged on the week but today saw some bounce...
HY Credit notably decoupled from stocks early on but as the rampfest started so HY pulled higher too....
The USD closed the week notably higher to new 12 year highs - for the 5th week in a row...
CHF was up 15.25% on the week against the USD)
Despite the USD strength, gold and silver surged and oil levitated back to green for the first positive week in the last 8... (copper recovered its China crash)
Oil's bounce lifted energy stocks - AGAIN!! - but once again. it decoupled from credit
Charts: Bloomberg
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Friday and Monday lift ups are always suspect. Friday is often traders taking advantage of uncertainty over the weekend which keeps normal traders chasing daily trends and Mondays are often people including the Treasury and banks under the treasury and governments trying to set the tone of the market. The argument that the drop in oil is finished is really laughable. There is still way more being produced than used and storage is still reaching brimming points.
A few drops in production will not pull supply anywhere close to demand and as many point out, the price of oil must hit closer to $20 to squeeze any significant people out of producing. And even then they already invested capital, they may pump anyways. In the meantime, other asset classes will also feel the downward pressure as the effects of overproduction induced by Federal Reserve silliness and outright gambling unwinds. Sadly, the Federal Reserve is getting desperate because most of the gambling will affect the TBTF banks they encouraged to gamble in the first place.