VIX is moving in tandem with the MOVE index (a proxy for bonds volatility), which should abate in the near term as the FED clearly stated that they are watching risks of tightening conditions carefully, and the MOVE index is already at a critical point.
After Jerome Powell gave zero support to the bond market, 10-year treasury yields continued to climb higher to the level where foreign investors' attractiveness is getting more pronounced. Thus, the Dollar gets more support in the short-term to rebalance the bond market to a higher yield regime. On EURUSD, we are sitting at a long-term support level based on the...
While small caps have been one of the best performers lately, they are still far from being overstretched on a relative performance basis . Reopening of the economy in the 1H of 2020 can reaccelerate the outperformance of the cyclical components while stocks that have been leading during coronavirus will lag behind.
After a 10-year yield breakout higher Gold has set a new lower high only to re-instate its bearish trend since August 2020. Gold has a perfect correlation with TLT, and this relationship rarely fades out. With the breakdown in TLT (150 level), Gold will probably establish a new lower low in the short-term.
