Wednesday, August 3, 2016

The Third Volatility Cycle: SHIT BREAKS

As it was in 2008, there have been two volatility spikes in the past 12 months. 

The third one is when the wheels come off the bus...and faking it non-stop for seven years straight turns out to be a bad fucking idea. Yes, again...

Realized S&P 500 volatility:

This third and last volatility cycle in 12 months features a manic blow-off top in U.S. large cap stocks, unconfirmed by every other asset class on the planet. Leading to a decline in every risk asset class at the exact same time...

The former leaders are rolling over hard:

The small cap rally is over
Equal weight / cap weight:

Breadth is collapsing...

A bounce in oil led today's feeble rally, Tech and Yield were in the red all day...

The cyclical rally is over


JPY is testing multi-year lows as Japan's latest stimulus plan implodes...

Deutsche Bank new low:

Big cap tech weak across the board

The entire oil-related risk complex is rolling over
Junk bonds, Energy stocks, Emerging Markets: