Obvious is Scary
As we wrote about yesterday, the net cable short position is at the most extreme levels on record. Presumably, those are bets on a decline after Article 50. What's also notable is that in the past two weeks, the net short has nearly doubled. In that time cable has edged higher and that leaves many traders underwater.
The trade is so obviously setting up for a short squeeze that it scares us, making us think we've missed something. Goldman Sachs is out with some research saying specs tend to be right about the direction of GBP but we struggle to see it this time. There should be nothing surprising about Article 50; not only in financial markets but also on Main St. Or maybe we're overthinking it.
In any case, what we're sure of is that if a short squeeze starts after Article 50, it will get very violent, very quickly.
Turning to politics, an instant poll from Elabe showed that Macron was the most-convincing, followed by Melenchon with Le Pen tied for third. Those types of surveys tend to be flakey and with a large portion of the French electorate remains undecided though and the polls in the coming days will be market moving.
The exchanges on immigration and culture were the most heated but one of the things that was striking was how populist rhetoric is growing more refined in Europe and globally. An example was Le Pen shifting to promoting sovereignty in a move that echoed 'America First'. She said she wasn't running to be Merkel's Vice-Chancellor. That's the kind of talk that will increasingly strike a chord in a Eurozone where growth is unbalanced.Latest IMTs
-
محتوى بوصلة السوق من العائد الى الذهب و الناسداك
by Ashraf Laidi | Mar 20, 2024 12:42
-
BTC Needs Powell Correction بيتكوين بحاجة الى تصحيح
by Ashraf Laidi | Mar 18, 2024 17:20
-
Not once, twice, but six ستة مرات ليس صدفة
by Ashraf Laidi | Mar 13, 2024 10:07
-
Finding 88K Bitcoin كيفية الوصول الى
by Ashraf Laidi | Mar 4, 2024 12:21
-
شراء بيتكوين وصل الى عشر أضعاف الإنتاج
by Ashraf Laidi | Feb 29, 2024 9:17