Tuesday, June 14, 2016

Betting It All On The Fed And China. What Could Go Wrong?

This just in after-hours. I'm sure this won't tank Asian markets and the Yuan, much...since ZH just showed that China has artificially crushed volatility in their stock market to gain MSCI inclusion (last chart)...

Traders took maximum risk home ahead of the Fed. Granted the algos will be desperate to generate an overnight ramp, leveraging an oversold European market. However, risks are asinine to the extreme...

Let's see, Global Financials going into Lehman mode
European stocks in full meltdown
Global bond yields new historic lows
Oil rolled over hard
Volatility exploding at a pace exceeding last August
Chinese Yuan, today at a new five year low

Shorts covering ahead of the Fed

What else?

Chinese Yuan, new lows overnight:

As usual, USDJPY rallied during the day session as algos borrowed free money from Japan, however, on the daily, today's "rally" is invisible as the currency pair holds tight to multi-year lows...


Got overnight risk?

Dumb beta:
Got backtest?

Got down volume? Check.
I wasn't lying when I said tomorrow can go either way - doji on the daily...we haven't seen a doji in a downtrend, since oh right January...

3x leveraged oil
Trying not to break $34 where the stop losses live...

Got European (bank) risk?