“To earn those stripes, you need to earn those scars first.”
-Tim Kennedy
Most people who ever built something disruptively unique and successful didn’t start with winning a sticker. They are the men and women who failed and then learned to fail faster so that they could evolve and ultimately win.
That’s not what you’ve seen on Wall Street this year. Losers keep begging for pivots and bailouts. Any new narrative will do. The latest is “the red wave of the mid-term elections is bullish for stocks.” Really?
“I didn’t fail because life was unfair. I failed because I made poor decisions. Without that failure I’d never be a Green Beret.” -Scars & Stripes, pg 388. God Bless America, her liberties, and whatever remains of free market capitalism.
Back to the Global Macro Grind…
Amidst The Mother of All Bubbles imploding this year, markets have already discounted the “red wave” (or do you seriously think the market is dumb enough to just start thinking about that today?).
BREAKING: Republican Wins Are HAWKISH For Interest Rates
Assuming everyone knows Powell is a Republican? Not everyone knows how pissed-off-a-Republican he was when Janet Yellen and Co. (Democrats) tried to throw him under the bus and mess with his re-nomination…
What’s the #1 US Mid-Term Election topic that a Republican can win with?
A: INFLATION
What did Powell remind Wall Street of at last week’s US stock market lows (and highs for bond yields)?
A: he’s serious about fighting inflation
BREAKING: UST 2YR YIELD PIVOTS TO NEW CYCLE HIGHS ON ELECTION DAY
A) Unlike most MSM “News” you’ll read today, that’s actually a true story
B) UST 2yr Yield has rocketed higher to 4.72% and remains Bullish TRADE and TREND @Hedgeye
C) UST Yield Curve (10s minus 2s) remains as inverted as it was heading into the 1 Recession
Remember the time Telecom Tom made the big “call” this year that “it’s like 1982” (BOTTOM IN, BUY STAHKS!)?
A) Remember the time when it was the late 1970s?
B) Remember Volcker + Reagan prior to 1982?
C) Remember that skipping the 1 Recession part didn’t happen?
“But, but… KM… the US Dollar chart is breaking down”… (heard almost monthly now for 11 months):
A) I hope you didn’t buy anything Crypto (in Dollars) on that during the latest bear market bounce
B) USD remains Bullish @Hedgeye TREND vs. Bitcoin, ETH, etc. Short in #Quad4
C) USD has resumed it’s epic Bull Run vs. British Pounds this morning as the British People get pounded
#POUNDED?
Yes, unlike The People in the USA who think that their “red wave is bullish for stocks” (I think they’re just more bearish on AOC’s $58 sweaters, but they’ll figure it all out), The People in the UK are still getting pounded.
UK Food Inflation #accelerated to an ALL-TIME high of +14.7% in OCT. And, according to my measuring and mapping records, ALL-TIME remains a long-time in human history.
Away from Bank-Run-Fried’s FTX imploding this morning (do you think the Red Wave is bullish or bearish for the regulation of that component of The Mother of All Bubbles?), what else is going on this morning?
A) Post the latest 2-day Bear Market bounce, the NASDAQ remains in Crash Mode -34.2% from its peak
B) AAPL and TSLA have immediate-term downside in my Risk Ranges towards $132 and $192 respectively
C) Panic/Perf Stricken Wall Street chased STAHKS (again) to lower highs yesterday
Yep, looking at the PRIME BROKERAGE data of Ye Olde Wall, consensus BUY SKEW (more buys and covers than sales) hit the 83rd percentile of 2022 readings yesterday. That’s the highest since October 3rd.
Please have your friends who do “charts” with new “mid-term” narratives, tell you a story about what happened right after those early OCT lower-highs.
Immediate-term Risk Range™ Signal with @Hedgeye TREND signal in brackets
UST 30yr Yield 4.05-4.37% (bullish)
UST 10yr Yield 3.95-4.29% (bullish)
UST 2yr Yield 4.39-4.84% (bullish)
High Yield (HYG) 71.28-74.16 (bearish)
SPX 3 (bearish)
NASDAQ 10,212-10,871 (bearish)
RUT 1 (bearish)
Tech (XLK) 117-128 (bearish)
Energy (XLE) 85.65-93.21 (bullish)
Consumer Staples (XLP) 70.11-73.72 (bullish)
Healthcare (XLV) 128.40-133.96 (bullish) `
Shanghai Comp 2 (bearish)
VIX 23.80-29.94 (bullish)
USD 109.45-113.70 (bullish)
GBP/USD 1.116-1.159$cad (bearish)
Oil (WTI) 85.31-92.98 (bullish)
Gold 1 (bearish)
AAPL 132-144 (bearish)
TSLA 192-221 (bearish)
Bitcoin 18,697-21,009 (bearish)
Best of luck out there today,
KM
Keith R. McCullough
Chief Executive Officer
