Trade: BTC, Gold, and Bonds
Unwind
Hello everyone,
As you know, since I closed the ES position this morning, we have only seen additional downside. The implication is that the ranges in variance are expanding.
Trade: Closing ES Long
Hello everyone, We have had huge success in the ES long thus far: The time has come to derisk and wait. I opened the trade here and am closing the trade here (see yellow lines): I laid out the positioning unwind here. Here is the deal: we don’t have a macro driver for the selling right now but we could price a much higher premium in positioning. This me…
Until we unwind the implied correlation positioning risk I noted in the equity report, I am neutral beta.
Equity Report: Where is the S&P500 going?
“Where you want to be is always in control, never wishing, always trading, and always, first and foremost protecting your butt.” Paul Tudor Jones Since it was published, the long ES trade has provided considerable returns. Hedge fund managers and market observers continue to underestimate the right tail risk in markets and misunderstand how to measure the…
As a result, it is prudent to go neutral on metals and Bitcoin here. I opened the BTC long at the lows (link) and we are well within the money now. I am taking the position off for a small gain.
I am also taking off the gold long I shared with paid subscribers:
Notice how risk assets are deviating marginally from bonds as the DXY rallies.
These are the types of signals we need to adapt to on the fly. We are managing the positioning risk and the macro risk of these flows.
I have laid out all the research contextualizing these flows here:
Interest Rate Report: Duration, TLT, and the macro cycle
This report will provide a detailed update on the current situation with interest rates across the curve, where they are likely moving as we progress into the end of 2024, and how this will impact other asset classes. I have laid out the macro tensions and variables in the following reports:
This really brings us to bonds.
(All additional trades for risk assets in ES or BTC will be shared with paid subscribers).
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