The Watch Series
Trade Alert: Booking profits in commodities
We have closed a position. Read which and P&L below
Norway Watch: Cheat sheet to assessing Norges Banks rate path
The mechanical adjustments are likely going to lead to a hawkish revision of the Norges Bank rate path tomorrow unless the subjective layer is used to send another signal. Risks tilted towards a hawkish take-away.
Trade Alert: Booking profits in commodities
We have closed a position. Read which and P&L below
Positioning Watch – Commodities are back on, and so are cyclical equities
Market positioning is finally aligning with the trends highlighted in the past weeks, and commodity positioning is now almost outright bullish for cyclical metals, while cyclical equities are moving. Read how markets are positioned here.
UK CPI Watch: Softer than priced in..
We see UK CPI coming in soft relative to expectations and generally find the BoE to be priced too hawkishly compared to peers. Read along why here..
Energy Cable #61: Commodities are breaking out #2!
Commodities have broken out of recent price ranges left, right and center over the past 1-2 weeks and we have timed the entries well. Read along to find our top-picks in Commodity space right now.
G5 Rates Watch: Mirror mirror on the wall, who’s the biggest interest rate cutter of them all?
We sum up a yuge week ahead in this brief and chart-heavy update on the big central banks. Where’s the value to be found in rates space this week?
Portfolio Watch: Markets sniffing out the Chinese resurgence case
The commodity cycle is healing, but overall trends are more lukewarm. Interesting whether this is the market sniffing out something related to the manufacturing cycle in China? Either way, we have been positioned appropriately.
FX Watch: Tough times ahead for king USD?
2024 has been better than feared for the USD, with hotter inflation data and better economic conditions paving the way for a stronger dollar, but what happens if the Fed cuts into sticky (or even rising) inflation?
China Watch: MAJOR breakouts in several commodities. Is China buying again?
With a break-out from ranges in Copper, Silver and Oil, we look for clues as to whether the Chinese buying is behind the sudden emerging optimism in the commodity space.
Policy Watch: The German ‘debt brake’ on EU green tech ambitions
How Germanys constitutional debt brake could hinder the green transition of Europe and leave Germany at the bottom of the leaderboard in the race towards fiscal deficits.
Out of the Box : Cut rates if you want lower inflation, Powell
Long term inflation expectations are trading around 2.25-2.5 percent and yet there is a sentiment among the Average Joe that the cost of living is still high. It’s Vibeflation. So how to deal with this? Well, just cut rates!
US CPI Reaction: Headache for Powell not so much markets
Hot on the heels of today’s awaited US CPI report, we offer our rundown of the most noteworthy figures. Safe to say the Fed wasn’t helped along in achieving their target.
Positioning Watch – Bye Bye Japanese Consensus Case?
Hints of a BoJ hike in as early as March sent Nikkei 225 down, while China-proxies like Hang Seng and South Korea were bid. Will a move from BoJ wreak havoc with market positioning?
Energy Cable #60: Copper getting some help from China?
The Chinese moves toward larger fiscal deficits may be helpful for the energy- and industrial metal cases, but we still lack confirmation from the actual manufacturing cycle globally. Could the commodity complex be the macro case of 2024?
US Inflation Watch: OER a one-off?
Was the sudden reacceleration in the owners equivalent of rent a one-off? This is the KEY question ahead of a report that brings soft food prices, soft car prices, soft goods prices and hot energy prices.
Replay: Premium Q&A March 5th 2024
Signs of a cyclical re-acceleration
Portfolio Watch: Sea of cyclical green
The cyclical rotation keeps rolling, and recent comments affirmed in our view that the Fed will allow the economy to reflate here. We caught on early and continue to reap great gains.
Commodity & Shipping Watch: Time to get back into the shipping bets?
Shipping stocks have not rallied lately despite the optimism in risk markets. Is a peace deal in Gaza a good sign for shipping companies? And how does it impact commodity markets? The latest Shanghai container output data looks bullish! Find the answers here.
Trade Alert: Going long the Manufacturing Metal
We see an improving Manufacturing sentiment as a decent bet for 2024 and this trade typically loves such an environment.
Macro Regime Indicator: MORE liquidity is coming
Just as we identified in last month’s regime – and as our asset allocation model predicted -, risk assets have indeed performed. Question is if they will continue to. As always, we present our model framework on how to structure your portfolio.
Positioning Watch – Are the unpopular bets back in town?
Equities continue to thrive given upbeat liquidity and growth conditions, while Fixed Income and commodities have provided more of a lackluster return, but are the unpopular bets returning in positioning data?
Trade Alert: AUD not picking up momentum yet
The Aussie bet has not really played out the way we wanted, and we were stopped out earlier today.
Energy Cable #59: More fuel for energy bulls?
Focus on OPEC’s continued production cuts into a story of bouncing growth which sets up a tasty story for crude and maybe also natural gas! Read why here!
ECB Watch: A scope for a decent dovish surprise
Despite inflation not dropping to the extent our models had suggested, the ECB has still been dovishly surprised relative to its base case. Will the ECB prepare for cuts at the meeting this week?
Portfolio Watch: What if we add a rate cut to this fire..
The cyclical rotation is slowly but surely rolling and if central banks add rate cuts to this mix, we are staring directly into the melt up.
EUR-flation Watch: Hands down, I was wrong..
Disinflation is simply not happening as fast as anticipated by our models, but base effects remain very benign in coming months. The stickiness in services is eye-catching, but there is light at the end of the tunnel for the ECB.
This is why Biden’s sanctions aren’t working
How well is Russia’s economy doing two years into the war? And how will the upcoming election play out? Read our explainer
Money Watch: Trillions of USDs are waiting to be unleashed
Money growth has improved lately in the US, while there are trillions parked on the time deposit / MMF side-lines. If the Fed cuts rates into the current rally, we may see another 2021/2022 melt-up.
Positioning Watch – Commodities are finally moving
Commodities positioning have remained fairly silent over the past few weeks, but we are seeing early signs of appetite for cyclical commodities now. Early innings of a cyclical rebound or just noise?
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Steno Signals
5 Things We Watch – Rates Pricing, Liquidity turning, Labor Market, Commodities & China
The hawkish US CPI report today has the potential to wreak havoc with market narratives and place the Fed in a difficult position, while commodities are in a prime position to continue their run. Read about the 5 things we watch in global macro here.
The week at a glance: US CPI to surprise hawkishly paired with a surprise rate cut?
CPI numbers from the US, Norway and Sweden paired with ECB and BoC action. Here is what to expect in a short and sweet format.
Steno Signals #94 – Trading the FAKE business cycle
The fake business cycle keeps surprising markets and central banks and the volatility in the cyclical components of the economy will likely keep markets trading from one extreme to another in coming years.
