Below is a chart and brief excerpt from today's Early Look written by Hedgeye CEO Keith McCullough.

But “don’t fight the Fed.”

Ok, sounds catchy, but I shorted more France (EWQ) on green yesterday and I shorted more US Financials (XLF) and Junk Bonds (JNK) on green yesterday too. I didn’t short SPY (haven’t since 2019), but I probably should have.

Why? Consensus capitulated, covering their SP500 Index and e-mini shorts at this time last week.

As you can see in today’s Chart of The Day (non-commercial CFTC futures and options positioning), the net SHORT SPX position has cannon-balled down to -61,437 contracts from a peak bearish positioning of -319,133 contracts in June.

In addition to measuring and mapping the particular ROCs of market positioning, we’re doing the same for market correlations. SPY’s 30-day inverse correlation with the US Dollar just dropped from -0.9 to -0.67.

That particularly matters within the lens of my process’s telescope too.

CHART OF THE DAY: 2008 Style Capitulation Of Consensus  - Chart of the Day