Friday Chart Book

May 3, 2025

Since I instilled a more “chill and watch” approach to markets a few weeks ago, things have moved along nicely. No particular observation or trigger told me to take off some risk and wait for better entries in line with my macro roadmap, which is still very much in play. Given Gold’s tremendous outperformance, the reversal candle on April 22nd ushered in a perfectly timed wave of profit-taking on my end.

Running into this week’s payrolls, I thought that markets might front-run the possibility of a weaker number and, in turn, offer less attractive risk-rewards for playing rates on the long side. This, alongside my reversal model flagging (see charts behind paywall below), overbought conditions gave me a nice short entry to fade US front-end pricing.

1y1y OIS pricing reversed levels last seen in the onset of the “liberation day” panic in the first few trading days in May.

US 10-year yields also didn’t get a look below the 200-day moving average for too long and snapped back to 4.30%

On payrolls, the April employment report showed continued strength, but with signs of cooling in certain aspects. Job gains exceeded expectations, yet revisions to previous months were downward. Hiring remains robust but concentrated in specific sectors, with federal job losses not fully reflected. Increased imports boosted transportation and warehousing jobs temporarily, despite impending layoffs. Prime-aged employment and measures of labour market slack indicate overall health, although wage growth is slowing. Yesterday’s figures suggest the Fed will maintain its current stance, as the labour market nears full employment amid persistent inflation above target.

The ongoing de-escalation of tariff talks is lifting risk asset performance, but also invoked quite sizeable moves in the FX space, where the Taiwanese Dollar tanked in its largest 1-day move since 1988. Needless to say, many levered punters were positioned the other way.

Given the strength in risk sentiment and fixed income weakness, you would have expected the USD to strengthen, but the opposite happened as we are still holding close to levels from last September.

Paper Alfa’s 2025 buy-and-hold portfolio is bouncing nicely and is now back above +6% YTD. While this portfolio holds some of the strategic trades I like, it doesn’t account for the tactical trading element, which I am applying on a daily and weekly basis. I am thinking about how to best make those trade thoughts available to my subscribers. Stay tuned.

Fun times are ahead, and we will continue to take advantage of the opportunities offered by our momentum, reversal, and intra-day models. In addition, I will publish a few more comprehensive macro pieces, untangling the effects of trade and budget deficits and what history tells us about how these factors affect markets. If you are reading this, chances are you are a free subscriber. I have been opining and sharing many of my thoughts for free. This will change going forward as I will put most of my insights behind the paywall. Don’t worry, though, education will always be free here, and I will share occasional thought pieces like the one below for free for everyone.

A reminder that you can now also use my models in TradingView scripts, which I made available for subscribers to use on their charts. This is not for free and incurs an additional cost.

If you are interested, ping me an email with your TV username. Note that only paying subscribers will be granted access. No exceptions.

Let’s now read some of Macro D’s latest thoughts before we go through all 250+ chart setups across Rates, FX, Commodities, Crypto, Stocks, and ETFs.

Let’s go!