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Everything Was Going Great Until…

It was not to be...

Everything was going great on Tuesday right up until the cash open on Wall Street.

A fleeting move higher after the opening bell seemed to suggest U.S. equities were all set to explode to the upside after an exuberant overnight session in Asia, but alas, it was not to be. In fact, it was all downhill from there:


We did hit 26,000 on the Dow briefly. That would be just 12 calendar days after 25,000, the shortest time between 1,000-point meaningless “milestones” ever.


At one point, the Dow was up 283 points before sinking into the red just after 2:00 ET:


Cue Picard:

Volatility made a rare cameo:


If you were looking for another sign of peak bullishness, look no further than the following which shows that people are paying up “bigly” for calls relative to puts (and by “bigly”, we mean a skew that’s two standard deviations below its five year average):


The greed isn’t quite as egregious in big-cap tech:


(“D.J. LK on the beat)

Treasurys chopped around but ultimately, the curve was flatter with the 5s30s inside of 48bps.


The beleaguered dollar tried to bounce back, but after rallying for the first time in five sessions, it fell apart as the euro rally resumed. Obviously, the possibility that Trump’s hardline on immigration ends up triggering a U.S. government shutdown at the end of this week is weighing on sentiment:


European shares faded gains into the close as U.S. shares lost momentum:


Cryptos were an absolute nightmare as a renewed China crackdown conspired with ongoing jitters about South Korea to drive the entire space sharply lower with Ripple getting hit particularly hard:


As noted first thing this morning, the Hong Kong rally seems to have hit escape velocity as traders furiously bought the Monday “dip” (and buy “dip” we mean the Hang Seng fell 0.2%). Monday’s small loss marked an end to a record-breaking streak of gains (14 in a row) for the Hang Seng, but Tuesday’s 1.8% rally suggested all’s well that ends in a move above the 2007 peak:


Now let’s see how Asian shares respond to the drama on Wall Street.

Oh, and finally…


7 comments on “Everything Was Going Great Until…

  1. 239 lbs is Overweight BMI
    240 lbs is Overweight BMI,
    241 lbs is Obese BMI


    In keeping with “superlatives always”, the heaviest president there ever was, easily 241, probably 404.,

  2. PaulMiller

    I hear many bells ringing, from today’s key reversal to extreme skew, margin debt, sentiment ratios and volatility resurgence.

  3. You forgot Taft. No problem there, so has almost everyone else.

    • According to Wikipedia – Taft was 5′ 11″ and weighed 335-340 lbs. his last year as President (1913). He could have made a fortune as a defensive lineman.

  4. broblawsky

    … the Fire Nation attacked.

  5. I have never heard a doctor say 2# under Obesity and excellent health in the same sentence…..oh, and already taking cholesterol med of some sort – didn’t he say that too? Oh, and sleeps about 4 hour every 24 hours? zero exercise other than golf, using a golf cart. He was a nice enough doc but he sure tried his best to put lipstick on that pig.

  6. Sorry, eh! Canadian immigrant helped Donald prove his cognitive health.

    “And one Arab-Canadian couldn’t be prouder.”

    “Nasreddine says the exam doesn’t test for everything: it doesn’t examine judgment, or personality, and in certain cases, he says, it can be duped by an extremely educated subject.”

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