Ian Reynolds
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Overnight
Markets 1 Trump 0
US stocks soar as Donald Trump backs down in global trade war [FT]
Although Americans will champion their leader taking on the world, investors told the White House that Armageddon was staring the WH in the face as bond yields backed up rapidly.
So Trump relented, rates came off a bit and the 10 year auction went through successfully.
The MOVE, a.k.a the "VIX of bonds," helps investors track volatility across U.S. Treasuries and sometimes, it can signal future action in equities, hit 140 yesterday just before Trump puked.
Markets now know 140 on the MOVE is the line in the sand.
U.S. Bond Market Option Volatility Estimate Index
Breaking
RBNZ lowers interest rate by 25 bps to 3.5% as expected [FX Street]
Equities
A stunning 12% comeback by the NASDAQ was the biggest equity mover.
NASDAQ Daily
Bitcoin
A big bounce but still under that downtrend. With future volatility look for BT to slowly decouple from tech stocks. It's already started but will take time and lots of scary sell-offs.
BITCOIN / USD Daily
Commodities
The King is back. A strong rebound in Gold after some much need consolidation. Will we break higher now that Gold is the only true flight to quality?
GOLD / USD Daily
Bonds
The hammer became a shooting star! And by the seat of it's pants the 10 year was saved. Amongst all of the sudden euphoria remember that at peak crisis, US Government bonds were the cause of the crisis and not a flight to safety. Same with USD.
Things have changed overnight. US Treasuries are not longer the risk-free asset.
US 10 Year Government Bond Yield Daily
Foreign Exchange
A small rebound in the Aussie but from a monthly perspective we're entering a new, lower valuation. Iron Ore dropped below 100.00 USD and Australia is now super sensitive to what's happening in China.
AUD / USD Monthly
Interesting
China and US data today. These will be much more important now we have the tariff pause so watch the recession indications for both economies. 30 year US auction should be worth looking at too as yield hit 5% the other day.
Economic Indicators Today
