Unwinding the Clock
Thank goodness for discipline!
The early morning seas are swelling with green and the chatter I'm picking up across the street is focused on the "macro unwind" What that means, in layman's terms, is that the macro hedge funds had the "war trade" on (long treasuries, long gold, short S&P) and have begun "unwinding" their positions. This, obviously, is speculation at best but it wouldn't shock me if it was, at some level, true.
The opening surge has taken the indices right towards initial resistance and I'm nibbled ever so gently on some April downsides. Again, this is a very tricky juncture and I'm not drawing any lines in the sand. However, I am comfortable dipping my toe into defined risk puts as we continue to find our way. If I get bullish tingles, I can always day trade from the long side--but let's see how the day progresses.
The semis are back in the spotlight as it's seemingly poked through it's downtrend line although SOX 300 has been a level of contention in the past. I'm not involved in the group directly but, obviously, I'm watching them as a sentiment tell for tech. Meanwhile, the "war avoidance" psychology is starting to get a bit louder--that's either self-fulfilling or a recipe for serious slippage (U.N vote huge).
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at email@example.com.
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