S&P 500 reversed to the downside on high volume, and the open short position became profitable from the get-go. No matter the premarket jubilation driven by retreat in bond yields, the bottom is clearly not yet in, and it‘s a matter of both technicals and hawkish monetary policy guidance. The bets on the Fed to back off tightening and go at least neutral, appear very premature – the plan is still to raise by 75bp in Nov and by 50bp in Dec with 25bp more early 2023, and Evans saying in effect the central bank is moving too fast without appreciating the effects of tightening already in, is a lone voice. Now, if I were to hear noises suggesting only 50bp in Nov or 25bp in Dec, that would change the picture.
Image and article originally from www.barchart.com. Read the original article here.
