NFP | Dec-16

Bullish /ES on strong jobs # and more bullish on tighter labor market, hrs worked and hourly earnings. Report will be stronger than expected on all fronts and the catalyst for resumption of dollar rally. Long /ES and short /6E.

Complacency ahead of FOMC

Good FOMC eve morning. Busy day today, so this one will be quick! Fed Funds Futures are pricing an 88% probability that the Fed will balk tomorrow. While I ultimately agree that the Fed won’t hike tomorrow, they’ll absolutely jawbone that they’re ready to do so.  That type of complacency is just the type of […]

Post NFP Thoughts

255k…nicely done! Given the volatility of the last two prints and moderately positive employment data in July, I expected a “hum ho” number, in line with consensus. 255k “feels” good and the market’s appears to have returned to a “good news is good news” psychology. That’s positive for risk assets in the immediate term. Going into […]

$FB Vol Carry

Now that I’m settled into a new job in a new city and my gold short has been a total flop, let’s try to make some money! Next Wednesday, $FB reports. Today, we saw beautiful price action against an awful tape. What’s more, IV actually ticked down! Given post-Brexit’s face-ripping rally, options markets appear entirely lacking […]

/GC Option Expiry Dealer Risk Analysis

I’m little late in posting this and it’s a little less useful now, with Gold having spiked higher post the horrible durable goods data this am. Nonetheless, here’s how dealer risk is looking ahead of the 1:30pm options expiry for Gold futures. The 1200 and 1275 levels fall well beyond the average maximum move range for […]

Update on Gold Short

Since posting about my “weird feeling” towards Gold’s price action on Tuesday, we’ve seen some major mixed moves in Gold futures and I’ve been able to perform some additional analysis worthy of an update. In full disclosure, I added June 1200 puts on Wednesday, but I did not end up putting on the long Gold derivative hedge I contemplated earlier in the week. […]

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Helicopter Money: Nah, That Would Never Happen…Think Again!

  I’ve long understood Friedman’s concept of “Helicopter Money,” but until last year, I had never explicitly encountered the term outside of academia. So when I saw an FT article mention “Helicopter Money” as a possible last resort alternative to QE, I instinctively dismissed it as hyperbole. Since then, however, I’ve noticed the term popping up in more and more places. […]