Traders Market Weekly: Impact of Global Risk Off Deleveraging

September 10 – 16, 2023

FEAR NOT Brave Investors

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The Week That Was – What Lies Ahead?


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The fluidity of financial conditions tightening as “risk on” transitions to “risk off” continued this week, through in some geopolitical gamesmanship. Price action in equities was led by Apple falling 6%, which in turn was influenced by China banning the iPhone and other international electronic devices from Chinese government workers. With all the Biden administration attacks on China and in particular on Semiconductors it is a surprise it took this long. The PHLX Semiconductor Index fell 3.2%. Sets up an interesting week for Apple ahead of its big event this coming week. It should be noted it was a below average volume week after Labor Day weekend.

Global market “risk off” is picking up speed. China’s Yuan fell another 1.06% against the dollar this week to the weakest level since 2007. The emerging markets had similar stories around the world. The Chilean peso fell 5.0%, the Polish zloty 3.9%, the Mexican peso 2.9%, and the Czech koruna 1.9%. We are seeing the effects of emerging markets and U.S. markets having succumbed to the greed fueled, FOMO intensified “melt-up” dynamics in the face of festering Chinese issues only exacerbated vulnerabilities.

Global central banks are facing pressure after a protracted period of policy tightening and amid uncertainty over their next steps. Oil continued its rise further hampers their future path, the moves are ahead of CPI and retail sales reports which prompted worries about inflation expectations and consumer spending pressures. WTI crude oil futures rose $1.92, or 2.2%, to $87.47/bbl. More geopolitical influences, Saudi Arabia and Russia are planning to extend their voluntary oil production cuts of 1 million barrels per day and 300,000 barrels per day, respectively, through the end of 2023. Treasury yields also rose again, thee 2-yr note yield rose nine basis points to 4.97% and the 10-yr note yield rose nine basis points to 4.26%.

The ISM Services PMI showed that services sector activity accelerated in August with prices increasing at a faster pace. Initial jobless claims for the week ending September 2 came in at the lowest since February, 216,000 and Q2 productivity was revised lower (to 3.5% from 3.7%) while unit labor costs were revised higher (to 2.2% from 1.6%). This all feeding into the Fed keeping rates up longer.

Notably only two of the S&P 500 sectors were higher this week, energy (+1.4%) and utilities (+0.3%). Energy is now positive YTD. The laggards were the industrials (-2.9%), information technology (-2.3%), and materials (-2.5%).

SPX Sectors YTD 9/8/23

Global bond market liquidity appears increasingly under the grips of deleveraging.

We can see the effect of global risk deleveraging in emerging markets paper.

  • Mexico’s local currency 10-year yields jumped 19 bps to 9.53%, the high since October.
  • Yields were up 18 bps in Indonesia (6.52%), 16 bps in Brazil (11.30%), and 12 bps in South Africa (11.91%).
  • EM dollar bonds were under heavy selling pressure. Yields jumped 24 bps in Colombia (7.79%), 20 bps in Peru (5.54%), 19 bps in Mexico (5.89%), 15 bps in Chile (5.33%), 15 bps in Russia (18.91%), and 14 bps in the Philippines (5.10%).

Back at home there is a huge swarth of Americans benefiting from high interest rates.

  • Money Fund holdings rose another $137 billion during Q2, with one-year growth of $696 billion, or 24.6%.
  • Money Fund holdings jumped $1.374 TN, or 64%, over the past 15 quarters.
  • This puts 15-quarter combined Deposits, Money Funds, Treasuries and Agency Securities at a bewildering $5.992 TN, or 39.2%.
  • There’s your answer to the resilience of consumer spending.

The distortion and shameless political theater from all sides has mishappen reality and that irrationality has poisoned decision making for many. Remember in bonds, commodities and forex the rubber always meets the road. That is what matters and that is what is running the distorted equity markets, as they say pick your poison and pick it wisely.

This Week’s Main Stories We Covered

September Mornings or Warnings?

Now that we heard from Fed Chair Powell at the Kansas City Fed’s Jackson Hole Symposium, the focus shifts back to the data and how bankers interpret it.

The September effect on risk appetite is a real thing, history suggests. That said we live in such manufactured times market wise, socially wise and sentiment wise we won’t put it all on that affect but is in the back of our minds.

Monthly returns on the S&P500 since 1928 lean towards September being the worst month for stocks on average at least for passive investing. In Septembers since 1945, the S&P 500 has declined an average of 0.7%, the worst performance of any month, according to CFRA.

Looking ahead for September there are a number of catalysts. We have had the jobs report and PCE. Next consumer price data due on Sep. 13 then the Fed’s monetary policy meeting Sep. 20. The Jackson Hole speech from Fed Chairman Powell fueled expectations of another rate increase this year, though a move in September was seen as less likely.

We have seen volatility in the recent weeks. The S&P 500 from up nearly 15% has retreated more than 4% from its July 31 high. Weakness in China’s economy and a surge in Treasury yields weigh.

Last Friday the final reading of the University of Michigan Consumer Sentiment Index for August came in at 69.5 (consensus 71.2) versus the preliminary reading of 71.2. The final reading for July was 71.6, which marked the highest level since October 2021. In the same period a year ago, the index was at 58.2.
The reports show consumers think the rapid improvements seen in the economy in the past three months have moderated if not illusory.

It is also globally that we look, and a heavy macro data week could materially inform the subsequent round of policy decisions by the RBA on the 5th, the BoC on the 6th, the ECB on the 14th, the Federal Reserve on the 20th, the BoE on the 21st and the Bank of Japan on the 22nd.

FOMO meets Passive with Tesla

We look at Tesla as it mirrors part of the FOMO crowd and part of the passive crowd, we can see from the chart it ran up ahead of earnings, dropped after it and sideways since. much like the belly of active stocks. From there we have created a potential bull flag which is in line with bond and sentiment. The bear side is it all falls what it is trying to correct. Clearly visible in the chart pattern below.

Outside the U.S. we had heightened financial stress and weak markets in China as we had been the pattern all year despite the constant dribbler and talking heads calling for a China turn around.

Risks Being Ignored or Opportunity Being Repriced?

With the swings of psychology and dominance of unemotional algorithm models dominating markets more than ever it is critical to stay unemotional and devoid of bias where best you can. For the next six months, we stick to our technical outlook via KnovaWave, watch the curve and EURUSD and USDJPY.

A reminder in these markets don’t get married to a view, leave biased partisan opinions at the door and find a leader. Right now, NVDA and TSLA continue to give us give good insights into crowd behavior. Note the divergence and convergence with it and other instruments. Be proactive.

These markets are constantly evolving, the important things is why we are here and it isn’t a surprise.

Where is the fear?

We got some movement these past weeks out of the tight range in markets but as we can see from the VIX chart it quickly reverted back after the initial breaks. We are aware of built-up energy ahead of key central bank decisions and potential fundamentals to set-up rate hikes or not. There is discontent globally with central banks and politician. The latest was the ushering in a new Governor at the Reserve Bank of Australia.

With optionality dominating markets along with quant funds, algorithms, systematic trading and automated trading volatility has collapsed as has been focused on at KnovaWave. The S&P 500 moved less than 1% in either direction for 36 of the 46 sessions heading into June, according to Dow Jones Market Data, the quietest 46-day stretch since December 2021. This was all in a period of a regional bank crisis and debt ceiling crisis. These systems have no emotion and trade accordingly. The weeks since then continued the pattern for the most part.

Driving quant funds is a self-reinforcing dynamic, when market volatility drops, they add which causes those funds that have paid higher volatility to cover and hence we get the churn. At the end of March, quant-focused hedge funds held about $1.13 trillion in assets, according to research firm HFR, hovering just below last year’s record high. That represents about 29% of all hedge-fund assets.

To break out of this requires a continuing break in a major down, or up move to ignite delta chasing or covering.

So-called vol-control and risk-parity funds, which tend to automatically load up on riskier assets during calmer periods, ramped up equity exposure, according to the Deutsche Bank data, available through May 18. Other quants, such as trend-following CTAs, or commodity trading advisers, have similarly piled in.

The dominance of quants has helped explain previous periods of calm trading, including long stretches in 2017 and 2018. Those periods were punctured by rapid selloffs, including the 2018 selloff dubbed “Volmageddon” when the dynamics exerting calm on the market suddenly went away. Some warn a repeat could be ahead.

Caitlin McCabe WSJ

Cboe Daily Market Statistics

Cboe Daily Market Statistics

Talking about manic behavior it is not hard to argue the punter is overwhelming and influencing markets like no other time, well until the next time. Swirling greed and know it all came home to roost. FOMO (fear of missing out) and TINA (there is no alternative) ended how they always do.

When the VIX is highly reactive, VIX related products can serve as potentially effective hedging tools, when the VIX is not very reactive, traditional hedging techniques may be a better choice.

The VOLX`s underlying instrument is the Mini VIX™ Future. The CBOE Volatility Index (VIX) is an up-to-the-minute market estimate of expected volatility. The VIX is calculated using a formula to derive expected volatility by averaging the weighted prices of out-of-the-money puts and calls (options) on the S&P 500.

Worth repeating again in the low VIX environment.

Well, 2008 redux didn’t happen in the last few months, so the Fed moves have worked for now, much to Xi and Putin’s chagrin.

The doomsayers may be right, but we are seeing constant surprises to that theory. For example, early signs that the US housing market slump is finding a base are emerging, pending home sales having risen for a third month and to a 6-month high. we will keep an eye on consumer sentiment and business activity. We are far from being out of the woods, remember the market is not the economy. Saying that we got quite the distorted job picture per our main job stories which we reprise below. Are we simply taking some air out or is the beginning of the great meltdown?

What we continue to notice is how this market is still being treated by ‘experts’ as those in the past, hence the volatility and extreme in bulls/bears. Understanding crowd behavior is essential in these markets. The moves have caught analysts and strategists by surprise with the uber bear running amok in the past few weeks. Typical thinking is this from Morgan Stanley strategists a month ago; “Given the events of the past few weeks, we think … equity markets are at greater risk of pricing in much lower estimates”, noting that earnings estimates were 15-20% too high even “before the recent banking events.”

What non-traders are failing to grasp is this market with so many variables is not trading as they expect and they are constantly wrong. S&P 500 earnings for the first quarter are estimated to have fallen 5% from 2022, followed by an expected 3.9% drop in the second quarter, Refinitiv data shows. During recessions, however, earnings tumble at a 24% annual rate on average, according to Ned Davis Research. However how important is that in such a chaotic market? There is the answer structure your thinking around game theory or even chaos theory.

Week Ahead: CPI, Arm IPO, Apple event, and Senate AI Forum

Eyes will be on top macroeconomic reports that will emphasize the health of the US and global economies. Eyes and ears will be on central bankers given the market turmoil and the hiking of rates.

Ahead we have decisions by the ECB, PBOC and Peru’s central bank. US CPI will give the Federal Reserve scope for its next move. The US also has retail sales for August with a meek print likely. Auto sales were down 4.5% m/m SA but prices were up a bit according to industry sources which might slightly insulate the effect. Gas prices rose 6.7% m/m and could add 0.5 ppts to the value of retail sales. Core sales excluding autos and gas could face downside risk after the large 1% rise the prior month.

The US will also update producer prices for August that should post a mild rise in core prices and a bigger gain in headline due to oil complex influences. Industrial production and the UMich consumer sentiment reading for September and the Empire manufacturing gauge give us a regional look.

How Hot is the American Economy?

More Macro and Micro data points, some highlights include.

  • Monday: Permissionless II event
  • Tuesday: Apple (AAPL) will hold its Wonderlust product launch
  • Wednesday: Weekly MBA Mortgage, August CPI and Core CPI, Weekly oil inventories.
  • Thursday: Weekly Initial and Continuing jobless claims, PPI, Core PPI, August Retail Sales, July Business Inventories, Weekly natural gas inventories,
  • Friday: August Import Prices, Export Prices, September Empire State Manufacturing survey, August Industrial Production and Capacity Utilization, preliminary University of Michigan Consumer Sentiment

How is the Consumer Hanging?

The US relies on services for up to 90% of GDP. it relies on the consumer who is being battered by the California and New York regional bank debacle. On top of that is cumbersome if not ignorant politicians, with no clear regard for main street the evidence suggests in their behavior. Key retailers all gave a cautionary note with tightened household budgets continue to hit demand for big-ticket items and curb discretionary spending.

We get more data to help us gage the consumer: Weekly MBA Mortgage, Weekly Initial and Continuing jobless claims, housing data, retail sales and consumer sentiment. Apple (AAPL) will hold its Wonderlust product launch

Earnings season continues with earnings from Casey’s General Stores (CASY), Bowlero (BOWL), Farmer Bros (FARM), Cracker Barrel Old Country Store (CBRL), Adobe (ADBE) and Lennar (LEN).

Click here to see the Full Week Ahead List Below

Some things never change, when you think Greed is Good

So how Screwed are We?

  • Fed Z.1 for June with the release of Q2 Credit and flow data shows seasonally adjusted and annualized Credit growth of about $4.5 TN. One-year Treasury debt expansion of about $1.7 TN. Non-Financial Debt-to-GDP exceeding previous cycle peak levels. The ratio of Total Debt Securities-to-GDP is significantly higher than prior peaks.
  • Household holdings of Financial Assets above previous peak levels. Household Net Worth inflating $5.5 TN in three months. Household Equities holdings as a percentage of GDP higher than previous cycle peaks.
  • The value of Household Real Estate holdings jumped $2.480 TN to a record $48.870 TN, lagging only Q1 2022’s $3.561 TN increase. It’s worth noting that the largest quarterly Real Estate gain during the mortgage finance Bubble period was Q3 2005’s $864 billion. Over the past 15 quarters, Household Real Estate holdings inflated $15.809 TN, or 47.8%.
  • The banking system is on much greater Credit risk than mortgage risks were offloaded during the 2008 mortgage finance Bubble. At $25.6 TN, Banking System Assets ended 2022 almost double the 2007 level.
  • In nominal dollars, system Credit expanded $795 billion during Q2 to a record $96.327 TN, with NFD expanding $1.111 TN (to $71.248 TN), while financial borrowings contracted $329 billion (to $20.350 TN) (Foreign borrowings were little changed).
  • System Credit posted one-year growth of $4.193 TN, or 4.6%. Over the 14 quarters since the onset of the pandemic, System Credit has surged $21.457 TN, or 28.7%. NFD has inflated $16.722 TN, or 30.7%, since the pandemic – and has doubled (plus $35.675 TN) since 2008.
  • If it doesn’t burst well, we circle back to the popular view that Financial Sector debt included in analysis would be “double counting” borrowings already included elsewhere (i.e. mortgage and business). The swift end to backs, the shocking management out there and geopolitical cold war out there has us ready to expect the unexpected and aware of moves to mitigate by central banks as we saw a few weeks ago.
  • GSE Assets declined $131 billion during Q2 to $9.409 TN. FHLB Loans fell $187 billion during Q2 to $855 billion. Still, FHLB Loans posted one-year growth of $335 billion, or 64.3%.
  • Over six quarters, FHLB Loans expanded $520 billion, or 155%. GSE Assets expanded $1.117 TN, or 13.5%, over six quarters, and $2.279 TN, or 32.0%, over 14 quarters.
  • FHLB plays a pivotal role, last year prolonging the lending boom and stabilizing bank liquidity.

The Credit cycle downturn is coming to the surface.

We have the reflective destabilizing Monetary Disorder. Take a peek at China and the markets collective cognitive dissonance to the property market there, the shadow banking as just one example. Have a look around the world. The hope is the collective mass continues to evolve and survive, while each time the destruction is evident in massive disproportion shifts of wealth and attempts of mind, if not physical control of the masses. Dial that back and try and get in the minds of those trying to right the ship and the market components that matter, not what the dribblers think matter.

Here’s a thought, knowing about the power of cognitive dissonance does not necessarily protect you from its effects. Traders are only too aware of this eureka moment when you grasp it. Why some of the best trades you ever do, are the ones you don’t. In option parlance, being delta neutral sometimes is the best trade.

Key this coming week will be the commencement of the next round of such indicators that will test whether these gains were one-offs or something that is sustainable. The key will be the extent to which downside risks to the US economy have been reduced enough to influence global central banks, and how markets react.

The Fed’s aggressive tightening cycle has had little effect on loose financial conditions.

Where to from here? It’s also okay to acknowledge and process any difficult emotions or experiences that you may have had during the past year. Looking back on the past year with perspective can help you to gain a greater understanding of what you have been through and how you have coped. I hope that you are able to find ways to manage any challenges that come your way and that you continue to feel fine moving forward. Embrace the chaos that is headed your way in 2023!

China; Behind the Iron Curtain

A big shift in 2022, China’s population is now falling and below that of India. China’s population fell for the first time since 1961 as births have steadily fallen in recent years despite the removal of the “one child policy”. The stalling working age population and its likely decline ahead means that potential growth in China is down from around 10% or so in the 2000s to around 4-5% now.

Growth in China’s metric of system Credit growth, Aggregate Financing, dropped to $175 billion, down significantly from March’s $773 billion and only 61% of estimates. It was also the weakest monthly growth since last October.

“China is warning domestic brokerages not to spread information that compromises national security, reinforcing a campaign that has roiled consulting firms and providers of financial data.”

  • September 7 – Reuters (Ziyi Tang and Ryan Woo): “Five of China’s major state banks said… they will start to lower interest rates on existing mortgages for first-home loans, part of a series of support measures announced by Beijing in recent weeks. Chinese regulators announced the policy last week to help homebuyers amid growing concern over the health of the world’s second-largest economy and a series of crises in the nation’s property sector.”
  • September 7 – Reuters (Joe Cash): “China’s exports and imports extended declines in August as the twin pressures of sagging overseas demand and weak consumer spending at home squeezed businesses… Exports dropped 8.8% in August year-on-year, customs data showed on Thursday, beating a forecast of 9.2%… and off a 14.5% drop in July. Meanwhile, imports contracted 7.3%, slower than an expected 9.0% decline and last month’s 12.4% fall.”
  • September 5 – Reuters (Julie Zhu, Kevin Huang, Yelin Mo and Roxanne Liu): “China is set to launch a new state-backed investment fund that aims to raise about $40 billion for its semiconductor sector…, as the country ramps up efforts to catch up with the U.S. and other rivals. It is likely to be the biggest of three funds launched by the China Integrated Circuit Industry Investment Fund… Its target of 300 billion yuan ($41bn) outdoes similar funds in 2014 and 2019, which… raised 138.7 billion yuan and 200 billion yuan respectively.”

The Market Tripod of Destruction.

  • Firstly, financial asset overvaluation has swung way past any sound underlying economic wealth structure.
  • Secondly over-leverage in crowded bets.
  • Thirdly we have greed enthused, as always in these cycles, risk engineering, transfer and management that ignores or understands bifurcation and contagion outcomes.

Leverage has become toxic, a development that if not addressed will have deep and with far-reaching sequels. It’s not too farfetched to suggest that the markets are on the verge of a rupture that would be difficult to contain. Should the crisis of confidence dynamics that hit Britain feed into other markets a powerful global contagion could be unleashed. The markets are dislocated, and financial stability is at risk. A sobering thought is the UK is just the initial first world pension system in this cycle facing the harsh reality of a steep devaluation of assets and the prospect of widespread insolvencies and debilitating negative sentiment.

Inflation Matters

Inflation with Henry Kaufman

Kaufman is the legendary chief economist and head of bond market research at Salomon Brothers is someone who knows Inflation.  Henry Kaufman in an interview with Bloomberg’s Erik Schatzker Jan 14, 2022:

 “I don’t think this Federal Reserve and this leadership has the stamina to act decisively. They’ll act incrementally. In order to turn the market around to a more non-inflationary attitude, you have to shock the market. You can’t raise interest rates bit-by-bit.”

“The longer the Fed takes to tackle a high rate of inflation, the more inflationary psychology is embedded in the private sector — and the more it will have to shock the system.”

“‘It’s dangerous to use the word transitory,’ Kaufman said. ‘The minute you say transitory, it means you’re willing to tolerate some inflation.’ That, he said, undermines the Fed’s role of maintaining economic and financial stability to achieve ‘reasonable non-inflationary growth.’”

Independence – Never Take It for Granted Traders

“In aggregate, the market goes from order to disorder, and on that journey little pockets of order can form, including in commodities, bonds, stocks, currencies that circle back and reorder disorder. Then there is us the market player that reflects through order and disorder in an ever-evolving loop towards independence. It all starts with gravity and ends with equilibrium and back we go.” KnovaWave “The rules of market flux”

The Fed has kicked off its first real tightening campaign since 1994, with securities markets already at the brink of illiquidity and dislocation. Markets could soon be screaming for assurances of the Fed’s “buyer of last resort” liquidity backstop, while the Fed is prepared to begin withdrawing liquidity by selling Treasuries and MBS.

Another important aspect is the Fed doesn’t Control corporate pricing or wage decisions. Let us be clear geopolitical, climate change developments and what an out of depth, politically motivated administration are outside the Fed’s sphere of influence. There has been over $5.1 Trillion new “money” in 126 weeks, it’s a reasonable conclusion the Fed has lost control of Inflation.

We need to grasp all the risks to be wary off and received plenty of flak from it. We always talk here about expect the unexpected and now that is front and center, gage the market’s reaction, the market is always right and that’s why we focused on the crowd psychology aspect over the past few weeks.

“We have a market trying to interpret the Fed who is trying to find out how they can interpret their long-only portfolio at a risk parity where rates cannot rise.”

– MoneyNeverSleeps

This move has crept up on many, to the extent the S&P 500’s is over the traditional measurement of a new bull market typically measured as a 20% gain from a significant low. The index above 4292.438 got that 20% move. That ended the longest bear market since 1948. The DAX and CAC40 have seen all-time highs recently also.

Our weekly reminder for risk. The downside is clear with the absence of moral hazard from repeated Federal Reserve market bailouts in an environment of some would say obscene liquidity pumps. Pure greed is the other part, not wanting to miss out on fees. The obvious question is, how deeply ingrained is this attitude through the markets? How do we ween the markets off this continuous dip feed? At this point the Central Banks have kicked that answer down the road.

Part A – Stock Markets

Weekly Highlights – USA


  • S&P500 declined 1.3% (up 16.1% y-t-d),
  • Dow slipped 0.7% (up 4.3%).
  • S&P 400 Midcaps dropped 3.6% (up 5.9%),
  • Small cap Russell 2000 fell 3.6% (up 5.1%).
  • Nasdaq100 declined 1.4% (up 39.7%).
Major US Stock Indices

YTD Report Card for the S&P Sectors


Notably only two of the S&P 500 sectors were higher this week, energy (+1.4%) and utilities (+0.3%). Energy is now positive YTD. The laggards were the industrials (-2.9%), information technology (-2.3%), and materials (-2.5%).

A breakdown of the performance of the S&P 500 sectors:

  • The Utilities increased 0.8% (down 12.3%).
  • The Banks fell 2.4% (down 20.3%),
  • Broker/Dealers lost 1.8% (up 11.5%).
  • Transports sank 4.0% (up 13.6%).
  • Semiconductors dropped 3.2% (up 40.8%).
  • Biotechs slumped 2.6% (down 1.5%).
  • With bullion down $21, the HUI gold equities index dropped 3.0% (down 4.7%).

Biggest SPX Stock Winners and Losers Last Week

Major US Indices

When Markets Get Short Behind the Curve

Worth reading again what fueled the recent rally… and then the sell off after ….

We analyzed the short component of this year’s rally back in May and it an important component of the market’s structure. Global stocks have continued to climb the wall of worry in 2023, with what has become a series of saves from the brink of economic disaster in a political episode worthy of the best Monty Python minds. The end result has left many investors over insured at times as we have been focusing on with option saturation, short bets and long only investors out of the market. The latter in a rising market essentially makes them short.

This background is not new we have seen it many times over the last 20 to 30 years. The difference here is the sheer weight of money in the system and the introduction of shorter dated options and so many playing it.

Speculators and hedge funds had put on the largest short positions in the S&P 500 since 2007 according to Bespoke Investment Group using CFTC data measured as a percentage of open futures-market interest.

At the same time, they have bet long on the Nasdaq-100, with net bullish plays nearing the highest levels since late last year, remember that. Markets go where the most pain is. The move, in a world where averaging your position is seen as trading has fueled larger positions. Anyone understand the martingale principle?

Fed Assets expanded $364 billion over three weeks in March in banking crisis liquidity operations (the market has a short memory that was only 8 weeks ago and helped create bigger shorts out there). Assets remain about $45 billion above the March 1st level. FHLB assets expanded an unprecedented $317 billion during Q1 ($802bn over 4 quarters). Indicative of the liquidity surge, money market fund assets inflated $384 billion in the five weeks beginning March 8th. In affect we got a massive boost a surge in financial sector Credit with those FHLB money market borrowings to finance its massive banking liquidity support operations.

That’s all well and good the trouble it is up, and substantially and the cost of carry is around 6-12% not 0-2% from last year. Trading from the short side is about timing, recognition and as they say strike like a cobra. The demise of the Californian and New York Regional Banks was a prime example, they were on the radar and once the cracks appeared, go hard, go fast.

Where are the Shorts Trapped at? (Becomes the Longs After Wave C’s or 3’s)

There is two ways of looking at this the bears and the dribblers out there argue it all has to come down. The rationale being the S&P 500 was up 12% this year, however it would be negative without the contribution of seven big tech companies. The argument is should any of those plunges then we are back to bringing it all down. The problem is it has gone up, we look at the AAPL and NVDA for just two names that dominate structure.

Global Stock Market Highlights

Highlights – Europe Stocks


  • U.K.’s FTSE equities index increased 0.2% (up 0.4% y-t-d).
  • France’s CAC40 declined 0.8% (up 11.8%).
  • German DAX equities index dipped 0.6% (up 13.0%).
  • Spain’s IBEX 35 equities index declined 0.9% (up 13.8%).
  • Italy’s FTSE MIB index fell 1.5% (up 19.1%).

Germany’s benchmark Blue Chip DAX 30 index (Deutscher Aktienindex) expanded to 40 companies on 20 September 2021 adding 10 new members to the German stock index from the MDAX which will be reduced from 60 to 50 members.

Highlights – Asia Stocks


  • Japan’s Nikkei Equities Index slipped 0.3% (up 25.0% y-t-d).
  • South Korea’s Kospi index slipped 0.6% (up 13.9%).
  • India’s Sensex equities index rose 1.9% (up 9.5%).
  • China’s Shanghai Exchange Index declined 0.5% (up 0.9%).

HighlightsAustralian Stocks

  • Australia’s S&P/ASX 200: -0.2% on Friday to 7156.7 (-1.7% for the week)
  • Friday iron ore miners weighed heavy on the index. BHP fell 1.2% to $43.19, Fortescue Metals lost 2.4% to $19.40 and Rio Tinto down 1.7% to $111.17.
  • Singapore iron ore October futures at $US113.20 a tonne, down from a four-month high of $US117 a tonne earlier this week.
  • Liontown Resources shares were the best-performing on the ASX, up 16.4 per cent. On Monday, US lithium giant Albemarle upped its non-binding offer for Liontown to in a deal valued at $6.6 billion. The shares last traded at $3.05 after gaining another 1 per cent on Friday.
W/E 9/8/23

Highlights – Emerging Markets Stocks


  • Brazil’s Bovespa index dropped 2.2% (up 5.1%),
  • Mexico’s Bolsa index fell 1.2% (up 8.3%).
  • Turkey’s Borsa Istanbul National 100 index gained 3.3% (up 51.1%).
  • Russia’s MICEX equities index dropped 2.7% (up 45.9%).

Technical Analysis

S&P 500

Daily: The daily SPX closed above the previous roof (Key Spits) which were also at 7/8 and clustered around the 50% & August breakdown. With energy and with a very low VIX it has mirrored the get cloud to get through overhead. The bullish take is that we completed the correction off last year’s high at the low and this is a larger 1-2 to go higher with support at the previous resistance and cloud. The bearish outlook is this move becomes a rising wedge and we are working out the uber bears before new lows.

When we talk about crowd psychology this is a great example. The market after spitting the 4100 and 38.2% retracement broke to capture the Tenkan. This underscores the power from the SPX spat of June & October lows with impulse through the tenkan and Kijun energized by the daily cloud twist that fueled this rally. The completive wave came off extreme fear and bear that ended with relief. Now we have sated much of the greed phase and short fear phase. We have completed that cycle and from here we measure the alternatives.

Daily S&P 500 3 waves

It is worth looking back at the completive highs (all-time highs) and how we played out so far. Tracing back from highs the fuel from the top of the channel after completing 3 waves off ATH, accelerated after broke the Tenkan through to the 4600 OI where it reversed with impulse back to Tenkan. Bulls, this is likely a (ii) of a 5. Bears this is 1-2 of (i) completive V of degree. We watch if this low was a (iii), (a) or C. We have to respect the number of alternatives of degree of 5. With such trends keep it simple. From no fear to panic is the driving element.

On the downside the Kijun and those June lows now critical and is our trading Bear/Bull pivot in a high vol scenario. Watch each measured 3 wave move on the 240 & Murrey Math highlighted in the podcast. The prices pulled through the downward cloud pulled by the twist ‘helium contusion’ on the completive. For fractal purposes, SPX completed 5 waves up where it reversed with impulse. Energy fueled from the power impulse down from +1/8 ATH spit of a spit fail. On the way down (just like up) it accelerated after it broke the Tenkan through the rejected Kijun and then through the median after tapping 8/8.

Weekly: The SPX has a clear channel off the lows on the weekly timeframe off the sphere of influence and has ground higher since it closed over the cloud above the Tenkan. Key support is the Tenkan, channel and +1/8. Power initially came from launching out of the sphere of influence as one would expect in a 3 or C. We had the Kijun spit also. Above is the channel and +3/8.

In the bigger picture we are playing out S&P 500 energy after it held the sphere of influence from Nov 2020 reversed higher after spitting the 38% and key lows. At the time we opined “We do have a weekly cloud twist; however, the energy is waning without sharp impulse.” We got the sharp impulse right to weekly Kijun. For major cycles we watch the S&P 500 over 4,231, the 50% retracement of losses from the Jan. 3 & June 16 close. Since 1950 there has never been a bear market rally that exceeded the 50% retracement then gone on to make new cycle lows. Is this time different, as we tested and spat those June lows?

On the way up each new high evolved after testing Tenkan key support on the way and we are now getting a retest as resistance. We reiterate this needs to be recovered for a resumption of the uptrend meanwhile the bear market plays out. Watch Tenkan this week and watch for Kijun reaction. Extensions are difficult to time, keep it simple.

S&P500 Weekly Outlook

THE KEY: Key for the impulse higher was the spit or retest of MM 8/8 and Tenkan San, which held with the previous highs and Tenkan.  To repeat “We look for 3 waves down and reactions to keep it simple with the alternatives in the daily.”  Keep an eye on the put/call ratio with recognition to the sheer size of contracts AND keep in mind the stimulus distortion. The spit per channel fractal and Adams rule launched back over the cloud where we were encased AND we are back testing it. Watch if a spit or clear break support as Chikou rebalances.

A reminder that Apple Inc $AAPL, Microsoft Corp $MSFT, Inc $AMZN, Facebook Inc $FB, and Google-parent Alphabet Inc $GOOGL make up approximately 23% of the total weight of the S&P 500. With that comes gyrations that are an outsized impact on broader markets


The down move saw Nasdaq spit the weekly Kijun and a 1-2 off tenkan we spat MM 5/8 after holding the key 61.8% Fib. We watch the Tenkan & Kijun confluence above, the breakup level and between the 38/50 Fibs. The Nasdaq is well behind the S&P pace with the weekly cloud and 50wma well above. Support the 61.8% retest.

NASDAQ Record Highs to 61.8% of impulsive

Recall ATH was after it broke and held the weekly Tenkan to see a spit of a spit fail which is completive of 5 of some degree with Chikou rebalancing. Watch Chikou for divergence for continuation or failure. Divergence with Russell also a clue.

Dow Jones

The Dow led the indices and closed above the weekly Tenkan after closing and testing last week. Prior test after the reaction off the June lows and sphere of influence. Support is the channel and Fibs. Tenkan and Kijun after the reaction empowered. Support is the channel and Fibs.

Russell 2000

The small cap Russell RUT bounced in double bottom off 1600 5/8 confluence which was the Nov 2020 breakup. Russell 2000 Resistance Tenkan and Kijun, note previous rejections. This is the index showing more of the fast money crowd and is trading like it. Needs to get traction in here for bulls. 7/8 & 8/8 support collapsed on the way down and is now major resistance.

Russell Index Negative Divergence to NASDAQ


NVidia $NVDA

Nvidia NVDA stock chart

NVidia surged 179.3% in H1 2023. It has been relentless since earnings and is the focus of the AI craze. With all manic moves beware of the pullbacks and topping potential. That said the extensions have played out and so far to +2/8 on the weekly. This was a classic set up as we can see. It has a textbook of KnovaWave methodology and rules from the 61.8% break and reverse through the sphere. NVDA accelerated after it broke the double top spheres at 5/8 giving is a near 4/8 move. A reminder that the dominance was in.

NVDA took off after the breakup retest from May 2021. NVidia is a clear leader of SOX & SMH look for cues there and ABC failures for changes. NVDA never looked back after the Key Break (mauve) and Tenkan to a flat cloud and holding support the recent low at the 61.8% extension.

Apple $AAPL

Apple AAPL Stock Chart

Apple has consistently driven upwards after it held the sphere of influence after retesting 6/8 & break up. Kijun and Tenkan crossing and then the 50wma with the cloud twist have been magnetic. Apple & other mega-cap names dominant the major indices, and a plethora of funds that hold it as a core position. The Vanguard Mega-Cap Growth ETF (MGK) delta is important to watch.

A firm rejection at $175 at +2/8 triggered a waterfall down for Apple last year. We regathered that and more and broke the weekly bull flag higher. On the way up Apple gently motored up to new ATH over the massive $160 then $170 thru to $180 gamma level on the way down these levels became key energy levels all the way to $132. Support held at the May break (just like NVDA) where from there it spat the cloud pulled by a flat Tenkan and Kijun as it rebalanced Chikou. The old channel break and MM +2/8 is now key. Remember the impact $AAPL has, at least short term on all the major indices.


Ark ARKK ETF Stock Chart

The ARK Innovation ETF (ARKK) finally found some support at -1/8, 78% off highs and the 423.6% extension! The ARK Innovation ETF returned 29% for Q1 2023. The fund is filled with growth stocks and was the top-performing U.S. equity fund tracked by Morningstar in 2020, it has not been a pretty slide. For the quarter, Nasdaq Computer Index up 25.7% and the NYSE Arca Technology Index gaining 26.1%. The Nasdaq100 (NDX) jumped 20.5%.

The ARKK ETF trading clinically, tested triangle breakdown and failed off 50 WMA. Some work at support at 61.8% of whole move and then wrecked again. Clear crowd behavior, we saw ATH in NASDAQ & SPX, yet this couldn’t raise a bid – very telling negative divergence. $ARKK rebalanced Chikou at week’s end

ExxonMobil XOM

ExxonMobil Weekly Chart

XOM has completed 5 waves from -3/8 to +3/8 on the weekly. with a double top. Alternatives 5 complete of degree. We are in a 1-2 (A-B depending on degree. Support is the cloud which has held 3 times since the high and the 50WMA resistance the tenkan and Kijun. Pattern wise we are in the bull flag until proven otherwise.

Part B: Bond Markets

Bond Watch


U.S. Treasuries finished the holiday-shortened week despite mounting global stress, Treasuries yields were pulled modestly higher. Ten-year Treasury yields gained nine bps this week to 4.26%, with benchmark MBS yields rising 11 bps to 6.00%. Global bond market liquidity appears increasingly under the grips of deleveraging. This week’s action left the 2s10s spread unchanged at -71 bps. Crude oil gained $1.92, or 2.2%, for the week while the U.S. Dollar Index gained 0.8% this week. What stands out to us is bonds are just not seeing much benefit from changes in Fed rate policy expectations.

Treasury Yield Watch


  • 2-yr: +1 bp to 4.97% (+9 bps for the week)
  • 3-yr: +2 bps to 4.69% (+12 bps for the week)
  • 5-yr: +2 bps to 4.40% (+11 bps for the week)
  • 10-yr: UNCH at 4.26% (+9 bps for the week)
  • 30-yr: -2 bps to 4.33% (+4 bps for the week)

Higher for longer is a serious threat.

Surging market yields are a serious issue for a banking system loaded with long duration securities portfolios. This may well be a push over the cliff for troubled commercial real estate (CRE). Leveraged lending and leveraged finance gets more costly. Simply there are trillions of floating rate loans among individuals, speculators, businesses, and nations.

Remember this? There is a reason why we focused on it recurring, you didn’t need Fitch to remind you:)

  • The iShares Investment Grade Corporate ETF (LQD) declined 1.01% Thursday, the largest loss since May 1st. The 2.40% loss for the week was the largest since February.
  • The iShares High Yield ETF (HYG) declined 0.73% Thursday, also the largest decline since May 1st. The 1.63% loss for the week, the worst weekly performance since early-March.
  • Friday Bloomberg headlines: “HYG ETF Daily Outflows $1.13 Bln, Biggest Move Since March 28th.” and “Two Giant Credit ETFs Hit by $2 Billion Exit on Hawkish Fed Bets.”

For our complete Weekly Fixed Interest Analysis and Outlook visit our Bond Traders Weekly Outlook:

Mortgage Market

  • Freddie Mac 30-year fixed mortgage rates fell eight bps to 7.14% (up 125bps y-o-y).
  • Fifteen-year rates slipped three bps to 6.66% (up 150bps).
  • Five-year hybrid ARM rates rose nine bps to 6.92% (up 228bps).
  • Bankrate’s survey of jumbo mortgage borrowing costs had 30-year fixed rates up 12 bps to 7.67% (up 157bps) – the high back to 2008.

Thirty-year mortgage rates have pulled back from 7.30%, the high back to December 2000. MBS yields traded up to 6.27% that week, the peak since July 2007, before ending the week down seven bps at 6.08%.

Mortgage News Daily

Global Debt Monitor

Highlights Unprecedented and Ongoing Surge in Global Debt

Last week, the Institute of International Finance (IIF) released their Q1 2023 Global Debt Monitor (GDM), highlighting the unprecedented – and ongoing – surge in global debt.

GDM Highlights:

  • “The global debt stock grew by $8.3 trillion to a near-record $305 trillion in Q123; the combination of high debt levels and rising interest rates has pushed up debt service costs, prompting concerns about leverage in the financial system.”
  • “Total debt of emerging markets hit a fresh record high of over $100 trillion (or 250% of GDP) – up from $75 trillion in 2019.”
  • “At close to $305 trillion, global debt is now $45 trillion higher than its pre-pandemic level and is expected to continue increasing rapidly.”
  • “Rise of private debt markets: Non-bank financial institutions (NBFLs) continue to gain prominence in global credit intermediation. The so-called ‘shadow banks’ now account for more than 14% of financial markets, with the majority of growth stemming from a rapid expansion of U.S. investment and private debt markets.”
  • “The Size of Private Debt Markets Surpassed $2.1 Trillion in 2022, Up From Less Than $0.1 Trillion in 2007.”

From the end of Q3 2019 through Q1 2023, Total Global Debt jumped $52.3 TN, or 20.7%, to $305 TN.

Over this period, “Mature” economy debt expanded 13.4%, while “Emerging” economy debt surged 38.9%. It’s worth nothing that in the “Emerging” category, “Household” debt surged 41.7%, “Non-Financial Corporate” 35.1%, and “Government” 55.7%. Since 2016, total global debt-to-GDP has surged from 210% to 360%. Global financial conditions remain loose. When they inevitably tighten, be prepared for serious dislocation.

Part C: Commodities


September 8, 2023

Key Long Term Commodity Charts


Copper Supply Crunch


China added to its gold reserves for an eighth consecutive month. People’s Bank of China holdings of bullion rose by 680,000 troy ounces last month, according to official data released Friday. That’s equivalent to 23 tons.

Gold in Perspective


For complete Oil and Natural Gas Coverage please visit our dedicated publications ‘Around the Barrel’ and ‘Into the Vortex.’ – Weekly Analysis and Outlook for Energy Traders and Investors


WTI Weekly KnovaWave Shape

Natural Gas

US Natural Gas KnovaWave Weekly Grid
Energy Market Closes

BDI Freight Index

Baltic Dry Index Weekly

For our complete Weekly Commodity Analysis and Outlook visit our Commodity Traders Weekly Outlook:

Charts and commentary via KnovaWave on:

  • Grains: Wheat, Corn, Soybeans
  • Metals: Copper, Aluminum
  • Precious Metals: Gold Silver
  • Lumber
  • Oil and Natural gas are covered separately (see below)

Part D: Forex Markets

John Maynard Keynes, 1920: “There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction and does it in a manner which not one man in a million is able to diagnose.”


  • For the week, the U.S. Dollar Index gained 0.8% to 105.09 (up 1.5% y-t-d). 2022 gains were 8.2%
  • For the week on the upside, Nil
  • On the downside, the Mexican peso declined 2.9%, the South African rand 1.5%, the Australian dollar 1.2%, the Japanese yen 1.1%, the South Korean won 1.1%, the New Zealand dollar 1.0%, the British pound 1.0%, the Singapore dollar 1.0%, the Swiss franc 0.9%, the Swedish krona 0.8%, the euro 0.7%, the Brazilian real 0.7%, the Canadian dollar 0.4%, and the Norwegian krone 0.2%. The Chinese (onshore) renminbi declined 1.06% versus the dollar (down 6.06%).

Weekly Foreign Exchange Price Change

For our complete Forex Weekly Analysis and Outlook visit our Forex Traders Weekly Outlook:

Charts and commentary via KnovaWave on the US Dollar, Euro, Japanese Yen, British Pound, Euro Pound, Swiss Franc, Canadian Dollar, Australian Dollar, New Zealand Dollar, Turkish Lira, Mexican Peso. Currency dynamics are complex. There are myriad facets to analyze and contemplate that influence all markets.



Bitcoin continues to be plaything of levered speculators, this week we saw the markets turn against those short. Where did this come from? Forced coverage from yield curve punts blowing up. Yen shorts and levered “carry trades” at risk.

It had been a churn following the FTX collapse. BTC had been stuck in the sphere of influence in continuation awaiting a catalyst, and it came. Continues to perform technically to perfection. Impulse begets impulse. To understand panic, understand greed. $BTC tested the top of a rising channel after the preceding sharp downturn which was the downside breakout of an earlier bearish flag, after breaking downside a H&S top and then down it went….

Recall Bitcoin exploded higher following it’s correction impulsively upon completing 5 waves up at +2/8. Each Tenkan and Kijun tap saw an explosive kiss of death until we completed 3 waves to around 28,000. From there we have seen extreme volatility.

Bitcoin KnovaWave Weekly Outlook

Looking back Bitcoin put in a high of $63,000 around Coinbase, the largest US crypto exchange successfully went public which signaled profit-taking. The high over $68,000 came after the launch over the Bitcoin ETF. From that high we have 2 main alternatives a V of a 1 of a V. For bears it a completive five with impulse right to the 50wma – an incredible 26% fall in a Friday night session. That’s impulse!

Bitcoin Mania in Perspective


Ethereum Weekly

On the Risk Radar

Fed Warnings on Possible Medium To Long Term Risks

 Geopolitical Tinderbox Radar

Turkey Geopolitical
Turkey Risk Monitor

Economic and Geopolitical Watch


Major US Banks for Q2, 2023

America’s big money center banks kicked of second quarter earnings with a solid start with solid beats by JP Morgan Chase, BlackRock, Wells Fargo, Citigroup and State Street.

Q223 Reports

Akio Morita mistakes

The Week Ahead – Have a Trading Plan

What Macro and Micro Risks and Opportunities Lie Ahead this week

Global Watch

Next Week’s Risk Dashboard via Scotiabank

  • Meddling with the Bank of Canada wouldn’t be costless
  • US CPI inflation likely to reinforce a Fed pause
  • The ECB decision is on a knife’s edge
  • PBOC expected to hold
  • Is China’s “deflation” gone already?
  • China macro to inform downside risks
  • US retail sales were probably soft
  • Australia’s jobs might rebound
  • UK jobs, wages to influence the BoE’s next decision
  • Will Peru’s central bank join neighbours in cutting?
  • Other global macro

Central Bank Watch

In the week ahead we have the ECB where markets are pricing less than 50% odds that a 25bps hike may be delivered. We also get the PBOC who are not expected to change its key policy rate. Finally, we have Peru’s central bank which may follow other LatAm central banks like Brazil’s and Chile’s and cut its reference rate by 25bps. We also have the US CPI which could inform the Federal Reserve’s next moves, and speakers from the BoE, BoJ, RBA, ECB.

Eyes and ears will be on central bankers. We have the backdrop of a more hawkish Fed Chair in the face of escalating systemic risk. How will this affect Fed policy given the massive treasury positions out there and the risk of uninsured funds? In this environment we get pivots daily. How much damage is the Federal Reserve willing to do in the guise of controlling inflation?

This Week’s Interest Rate Announcements (Time E.T.)

In the week ahead we get 3 central banks delivering policy decision.

Thursday, September 7, 2023

  • 08:15 EUR ECB Interest Rate Decision
  • 19:00 Peru Interest Rate Decision
  • 22:00 PBOC Interest Rate Decision

For our complete Central Bank Analysis and Outlook Visit our Central Bank Watch:

U.S. Economic Data Watch

US Data Focus

  • Monday: $44 bln 3-yr Treasury note auction results at 13:00 ET
  • Tuesday: $35 bln 10-yr Treasury note reopening results at 13:00 ET
  • Wednesday: Weekly MBA Mortgage Index (prior -2.9%) at 7:00 ET; August CPI (consensus 0.6%; prior 0.2%) and Core CPI (consensus 0.2%; prior 0.2%) at 8:30 ET; weekly crude oil inventories (prior -6.31 mln) at 10:30 ET; $20 bln 30-yr Treasury bond reopening results at 13:00 ET; and August Treasury Budget (prior -$221.0 bln) at 14:00 ET
  • Thursday: Weekly Initial Claims (consensus 226,000; prior 216,000), Continuing Claims (prior 1.679 mln), PPI (consensus 0.4%; prior 0.3%), Core PPI (consensus 0.2%; prior 0.3%), August Retail Sales (consensus 0.2%; prior 0.7%), and Retail Sales ex-auto (consensus 0.4%; prior 1.0%) at 8:30 ET; July Business Inventories (consensus 0.1%; prior 0.0%) at 10:00 ET; weekly natural gas inventories (prior +33 bcf) at 10:30 ET
  • Friday: August Import Prices (prior 0.4%), Import Prices ex-oil (prior 0.0%), Export Prices (prior 0.7%), Export Prices ex-agriculture (prior 0.6%), and September Empire State Manufacturing survey (consensus -10.0; prior -19.0) at 8:30 ET; August Industrial Production (consensus 0.2%; prior 1.0%) and Capacity Utilization (consensus 79.3%; prior 79.3%) at 9:15 ET; and preliminary University of Michigan Consumer Sentiment (consensus 69.4; prior 69.5) at 10:00 ET

US Stocks Watch Earnings and Event Watch

Earnings Highlights This Week:

  • Monday includes Oracle (ORCL) Casey’s General Stores (CASY) Bowlero (BOWL)
  • Tuesday includes Cognyte Software (CGNT) and InnovAge Holding (INNV). Farmer Bros (FARM)
  • Wednesday includes Cracker Barrel Old Country Store (CBRL) and REV Group (REVG).
  • Thursday includes Adobe (ADBE) and Lennar (LEN).
  • Friday includes

Investors (and algos) will focus on the conference calls and outlooks. Last quarter everyone expected the worse, we saw critical updates on production in coronavirus impacted regions and if there is extended halting of operations weighing on multi-nationals. 


Saturday, Sept. 9

  • G-20 summit in New Delhi: President Biden, UK PM Sunak and Saudi Crown Prince Mohammed bin Salman plan to attend

Sunday, Sept. 10

  • Russia’s Eastern Economic Forum: North Korean leader Kim Jong Un to meet with Russian President Putin
  • Russia holds regional elections, including in four occupied regions of Ukraine

Notable conferences running during the week include:

  • Morgan Stanley Global Healthcare Conference which will feature participation by Merck (MRK), Biogen (BIIB), Roche Holding AG (OTCQX:RHHBY), and Gilead Sciences (GILD) to name just a few.
  • Morgan Stanley Laguna Conference,
  • Barclays Global Financial Services Conference,
  • Piper Sandler Growth Frontiers Conference,
  • Goldman Sachs Global Retailing Conference,
  • Baird Global Healthcare Conference,
  • UBS Global Energy Transition Conference,
  • BofA Securities Media, Communications and Entertainment Conference.


  • Creditors of China’s Country Garden finish voting on requests to extend more bonds
  • Thailand PM Thavisin to unveil economic measures at joint session of parliament
  • All day – Fortinet (FTNT) third annual Security Summit in Napa, California.
  • All day – The three-day Permissionless II event will begin in Austin, Texas. Permissionless II is described as the world’s largest DeFi event, with over 7K crypto enthusiasts and builders expected to be in attendance. Ethereum (ETH-USD) Co-Founder Vitalik Buterin and SEC Commissioner Hester Peirce will be two of the notable speakers.
  • All day – Roche Holding AG (OTCQX:RHHBY) will hold its Pharma Day event in London.


  • New Zealand’s Treasury releases pre-election economic and fiscal update
  • All day – The three-day Salesforce (CRM) Dreamforce Conference will begin. Notable speakers include Salesforce (CRM) CEO Marc Benioff, OpenAI CEO Sam Altman, and Salesforce AI CEO Clara Shih.
  • All day – Nasdaq will release the latest update on short interest positions. The small cap stocks with the highest percentage of short interest outstanding on them are Fisker (FSR), Springworks Therapeutics (SWTX), Winnebago (WGO), Sunnova Energy (NOVA), and Luminar Technologies (LAZR).
  • All day – Nike (NKE) will hold its annual meeting. Proxy firm ISS has recommended that Nike investors vote for the resolution calling on the company to disclose more data on pay equity for female and minority employees. A similar resolution was voted down in 2021. A separate resolution calls on Nike to offer more transparency on supply chain working conditions.
  • 1:00 p.m. Apple (AAPL) will hold its Wonderlust product launch at the company’s headquarters in Cupertino, California, with new iPhones expected to be revealed.


  • All day – The U.S. Senate will hold its first AI Insight Forum. The list of participants who will discuss AI topics includes OpenAI CEO Sam Altman, Nvidia (NVDA) CEO Jensen Huang, IBM (IBM) CEO Arvind Krishna, Microsoft (MSFT) CEO Satya Nadella, Microsoft co-founder Bill Gates, Meta Platforms (META) CEO Mark Zuckerberg, and Tesla (TSLA) CEO Elon Musk. The event will not be open to the press, but a readout will be distributed.
  • Aramark Holdings Corporation Uniform Services Analyst Day,
  • Triumph Group Investor Day,
  • Yum China (YUMC) Investor Day,
  • Moderna (MRNA) R&D Day,
  • JFrog Ltd. Investor and Financial Analyst Event.
  • All day – The go-shop period on the acquisition of New Relic (NEWR) by Francisco Partners and TPG will expire. New Relic traded about 2% below the deal price at the time of publication.


  • United Auto Workers union contract talks reach a pivotal moment that could shut down a major section of the US economy
  • German Foreign Minister Baerbock to meet with US Secretary of State Blinken in DC
  • Italian PM Meloni to attend Budapest Demographic Summit
  • All day – British chip design firm Arm Holdings (ARM) is expected to start trading in the U.S. after pricing its IPO.
  • PowerSchool’s (PWSC) Investor Day,
  • Cimpress’ (CMPR) Investor Day,
  • Bristol Myers Squibb’s (BMY) R&D Day 2023,
  • Mayville Engineering Company’s (MEC) Investor Day,
  • Ecolab’s (ECL) Investor Day,
  • Labcorp’s (LH) Investor Day,
  • Bitfarms’ (BITF) Analyst & Investor Day,
  • Koppers Holdings’ (KOP) Investor Day,
  • BullFrog AI Holdings’ (BFRG) Webinar,
  • DoubleVerify’s (DV) Innovation Day 2023,
  • Ocean Biomedical’s (OCEA) R&D Day.


  • Chinese financial institutions set to reduce foreign exchange deposits held in reserve
  • Informal meeting of EU finance ministers in Spain
  • All day – It is the last trading day before the FDA action date on GSK’s (GSK) blood cancer candidate momelotinib. The FDA extended the review period by three months for a drug the British drugmaker gained through its $1.9B buyout of Sierra Oncology last year.
  • All day – PNM Resources (PNM) will be on watch amid a New Mexico Supreme Court hearing over the company’s plan to transfer its ownership of the coal-fired Four Corners Power Plant to a Navajo power company.
  • All day – Shareholders with Novartis (NVS) will vote on the company’s plan to separate the Sandoz business to create a standalone company by way of a 100% spin-off.

Sovereign Rating Updates

  • Germany (Fitch)
  • Belgium (S&P)
  • Saudi Arabia (S&P)
  • Spain (S&P)
  • Greece (Moody’s)
  • Netherlands (DBRS)

IPO Wrap

US IPO Week Ahead:

Focus on yourself and what YOU CAN INFLUENCE, set your trading plan and goals in be set for 2022.

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