No trading day is like another. That’s certainly been the case ever since we had the CPI print and BoJ intervention. What started as an RTY/NQ unwind of epic proportions has now turned to other markets where, clearly, position squaring is still ongoing. This makes for uncomfortable gyrations in anyone’s portfolio. That’s why I suggested trimming things a few weeks ago, keeping only your most beloved positions, and reducing sizes where you can. For a longer-term investor, this is just a blip; for a trader, however, it is his or her bread and butter.
Bonds trade poorly, Equity indices are not in full recovery mode, metals and energy are still feeling the cold, while only BTC outperformed on a relative basis. The JPY is continuing on a tear, invoking unwinds across EM FX for the beloved carry trade over the summer, which has now come back, biting everyone. There is no escaping. As for the JPY, Macro D called this one brilliantly in his thought-piece series on the Boj and Central Banking chess. If he’s right, we have way further to go. Read his thoughts below.
Let’s now hear from the man himself before exploring what’s flashing in my charts.
Keep reading with a 7-day free trial
Subscribe to Paper Alfa - Macro & More to keep reading this post and get 7 days of free access to the full post archives.