Brexit Hedge Unwind Sparks Volumeless Dead Cat Brounce
By Tyler Durden
Cheer up Brexit…
Somone had to do something… and it appears GBJPY was the momentum igniter du jour to save the world…
As hedge-unwinds were misunderstood as a bullish signal… in stocks
and FX…
Notably VXV/VIX had dropped to its lowest level since August crash – and today's bounce seems like post-event VIX unwinds…
Stocks bounced confidently today.. on low volume
On the day, we pefectly retraced yesterday's drop…
But post-Brexit things remain ugly…
As US equities decoupled from Cable…
Notably the S&P surged up to the opening levels from yesterdsay and faded… while VIX had fallen 7 handles!!!
Financials had their best day in over 3 months.. but are still down over 6% from Brexit
Some context, post-Brexit…
Treasury yields rose modestly on the day by around 2bps, but the curve remains drastically flatter post-Brexit…
The USD Index dropped modestly on the day as GBPJPY dominated the action once again…
Commodities were mixed with gold down, silver up, and with crude rising on the brexit bounce and Norwegian strike 'hopes'…
Finally, another day, another panic bid at the NYMEX close…
Source: Brexit Hedge Unwind Sparks Volumeless Dead Cat Brounce
