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Crypto, Crude, & 'Crappy' Stocks Dump'n'Pump As Fed Sparks Dollar Spike

Crypto, Crude, & ‘Crappy’ Stocks Dump’n’Pump As Fed Sparks Dollar Spike

The headlines of the day were without doubt made in cryptoland as the entire space saw $1 trillion of wealth destroyed at its nadir today…

Source

But you can’t keep a good thing down…

Source: Bloomberg

…as the following two tweets explain…

But for the HODLers, this has all been seen before…

Source: Bloomberg

And as Bitcoin was clubbed like a baby seal, gold rallied (and as crypto recovered, gold reversed, helped by The Fed’s taper talk)…

Source: Bloomberg

Ethereum rebounced back from below $2000, back up near its 50DMA…

Source: Bloomberg

Bitcoin bounced back off $30,000, rallying all the way back to its 200DMA…

Source: Bloomberg

Bitcoin’s 14-day RSI flashed its most oversold reading since March 2020, when prices dipped below $40,000.

Source: Bloomberg

Stocks also saw a big dump-n-pump day with Nasdaq outperforming (seemingly finding a magic bid after The Fed said it was thinking about thinking about tapering). Small Cap slagged…

The S&P 500 and Dow found some support at their 50DMA once again…

All sectors ended red with Tech the best and Energy the worst…

Source: Bloomberg

“Crappy” – non-profitable tech stocks – were also dumped at the open, only to rip back higher during the day…

Source: Bloomberg

The crypto proxy stocks also dumped and pumped…

Source: Bloomberg

VIX surged to 26 intraday…

Treasuries were sold along with stocks today for the 3rd day in a row (and 6th day of the last 8 days)…

Source: Bloomberg

10Y yields rose once again off that pre-CPI level…

Source: Bloomberg

And as Nomura noted that the abrupt reversal btwn ES and TY from “negatively correlated” for the vast majority of the post-GFC era (a rolling 60d corr low of -74.8% in Nov ’11, with the low since start of 2020 being -62.3% on 2/24/20) to now, the most “positively correlated” since 1999 (60d rolling now @ +54.1) – all thanks to last year’s pandemic response-driven macro regime shift (“From Duration to Reflation”)…

Source: Bloomberg

…has meant a frustrating bleed for risk-parity-types and 60/40 “balanced fund” models, where bonds have traditionally played the role as the perceived “low vol” / “risk-off” hedge.

Source: Bloomberg

The dollar was quietly doing its thing until The Fed’s taper talk sent it vertical…

Source: Bloomberg

Gold whipsawed to end unchanged (bid on crypto chaos, offered on Fed taper talk, usd bid)…

Crude prices tumbled on a crude inventory build and more positive headlines from the JCPOA talks… but again that was bid back just like yesterday…

 

Finally, we note that, as @sentimentrader pointed out, in the past 7 sessions, stocks have suffered 3 of the largest bouts of concentrated selling pressure in history.

  • May 11: Largest all-time

  • Today: 4th-largest

  • May 12: 19th-largest

Source: Bloomberg

Makes you wonder just how nervous everyone really is.Maybe this is why…

Source: Bloomberg

We’re gonna need a bigger (stimmy) boat!

Tyler Durden
Wed, 05/19/2021 – 16:00

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