DXY appears ready to sell:
AUD barely firmed:
CNY has been re-pegged:
Oil and gold sagged with Israel fears:
Dirt is hanging on:
Miners too:
EMs stocks were not so good:
Junk bounced:
As bonds were bought:
But stocks could not rally:
Notorious hedgie, Bill Ackman, lifted Treasuries by covering his short:
We covered our bond short.
— Bill Ackman (@BillAckman) October 23, 2023
There is too much risk in the world to remain short bonds at current long-term rates.
— Bill Ackman (@BillAckman) October 23, 2023
I agree, the worst is yet to come for the economy. At some point, the Fed will have to reverse as they went too far. That is why I started nibbling $TLT. Maybe I am too soon.
— Biotech2k (@Biotech2k1) October 23, 2023
Maybe so. But I still think that the war is likely to remain contained. This may mean yields stay higher for longer as we avoid a severe economic shock from oil.
Anyway, DXY sold off in sympathy with falling yields. There’s surprisingly little broader relief which may suggest yields are finally high enough to choke off growth.
If so, AUD is close to the bottom. If not, yields and DXY will go another leg higher.
