The CPI came in this morning, and instead of the expected 0.3% monthly increase, it was 0.2%.
That was enough to flip every single red quote to green instantly, as the market continued to swallow the narrative the slowing inflation means Fed rate cuts means stocks to the moon.
The /NQ, shown both above and below, is interesting since it seems to keep “wanting” to blast above its base, but it fails to do so every time. Indeed, as I am typing these words, just twenty minutes after the CPI release, the /NQ has lost most of its post-CPI pop. That doesn’t mean much right now, I realize, but if the /NQ goes limp again today, I think it should be quite telling since that’ll mark the 4th failed breakout attempt. (Errr, I finished typing that sentence, and most equities are back in the red; interesting).
The /RTY small caps enjoyed the biggest pop (to lifetime highs) but here, too, it’s fading fast.
The achievement from this pop was to almost match the lifetime futures high on the /RTY. Hey, that rhymes! Theo Geisel has nothing on me.
Precious metals continue to be total studs, with my autumn 2024 silver continuing as the standout with, as usual, a new lifetime high.
Looking at silver over the past year is just jaw-dropping. Remember when I suggested going out to Costco and buying all the American Eagle 1-ounce coins they would allow? Turned out to be pretty good advice, considering the alternative was a 500-pack of Slim Jims.
I remain conservatively positioned (about 78% exposure) across 20 short positions. It isn’t even half an hour since the CPI came out, and it’s already been a wild ride. See you later this morning!
