CHART OF THE DAY: A Data Dependent Fed Should Be Hawkish on Inflation

Our process is patient. And it’s also catalyst driven. Shorting Long-term Treasuries (TLT) at the end of last week had 3 catalysts: 

1. If Powell is data dependent, he should be hawkish on inflation at today’s FOMC meeting
2. I think Friday’s US jobs report will continue to show US Wages #accelerating
3. UST 10yr Yield has immediate-term upside to a fresh YTD high of 3.06-3.08% 

The #1 risk to being Long Energy (XLE) and Short Long-term Treasuries (TLT) is the same thing = Inflation Slowing. If our #process was measuring and mapping that the probability of that outcome was rising, I wouldn’t have these positions.