Nasdaq Hits New Record High As Confidence Crashes To 6 Year Lows

August 25, 2020 NEWS

“Probably nothing…”

Source: Bloomberg

If you felt like “this is madness,” you’re not alone…

As indices, but not the market, keep crawling higher on the unprecedented market expansion in select stocks imbalances are building that suggest reversion risk is building. Whether this reversion risk sets up for a buyable dip or a change in market character remains to be seen, but the more disconnected charts get the larger the reversion risk in my view.

Call me old fashioned but I still subscribe to an apparently forgotten scientific theory known as gravity.

And be clear, the market cap expansions we’re witnessing in 2020 off of the March lows are without precedent…

While yesterday saw Nasdaq (growth) panic sold at the cash market open after an overnight pump, today’s price action was opposite-land – after overnight weakness, Nasdaq was panic bid at the open and never looked back…

Yesterday’s momo-value reversal eased a little today (value sold, momo bid)…

Source: Bloomberg

AAPL dared to trade lower on the day unable to get back above $500 after its split date…

And if you wondered just how insane things have got – there’s this – AAPL’s put-call skew has never been lower (more skewed to levered longs than any protection ever…)

Source: Bloomberg

The dollar looks like it is coiling up for a move (perhaps into Powell’s Thursday speech) with lower highs and higher lows today…

Source: Bloomberg

Treasury yields were higher on the day, but ended well off the early spike highs intraday reversing after Europe closed (with the long-end underperforming)…

Source: Bloomberg

10Y Yields briefly jumped above 70bps before a bid came in…

Source: Bloomberg

Cryptos were clubbed like a baby seal today…

Source: Bloomberg

With Bitcoin back below $11,500…

Source: Bloomberg

Oil outperformed in the commodity complex today (ahead of tonight’s inventory data, amid huge shut-ins for US crude production in the Gulf. Gold was flat…