sp'daily5
VIX'daily3
Summary
In pre-market, the sp' was higher by around 13pts. Then the CPI data was released - m/m +0.5%, the algo-bots freaked out, and swung the market to -35pts or so. By the time the market did open, declines only amounted to -10pts. Once again, there was a distinct turnaround, with the sp' settling significantly higher.
Volatility saw a spike in pre-market to 25.72, but then melted across the day, settling back under the key 20 threshold for the first time since Feb'2nd.
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Rate hikes and inflation
The market is currently expecting 2-3 hikes this year. Yours truly is holding to 4 hikes.This morning's pre-market reaction to the notion of higher inflation is a sign the mainstream are still very twitchy. Ironically, this is the same mainstream that have been seeking inflation >2.0% for around a decade.
Ohh, and to be clear, if the Fed don't raise rates this March 21st, that would merit provisional alarm bells. For the moment, I still think they will, but each point lower in the sp'500... will lower the probability.
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Extra charts in AH (usually around 7pm EST) @ https://twitter.com/permabear_uk
Goodnight from London
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