DC Lite #533

1. Inflation expectations. “While there is quite a bit of anxiety over price pressures to kick off the year, consumers surveyed by the New York Fed seem sanguine. The median one-year ahead expected inflation rate sank to 3.09%, the lowest level since July. 3Y ahead expectations where they were in 2018.”

2. DXY positioning. “Dollar shorts chase recent weakness and are now back to 2025 short levels”.

3. BTCUSD vs. BTCSPY. “I am very defensive on Bitcoin here... This is why. Top = Bitcoin with an undercut retest after a breakdown. Bottom = Bitcoin relative to S&P 500 (BTC/SPY). BTC/SPY retested the breakdown zone, got rejected and made new lows. I’m wary that BTCUSD will do the exact same here.”

4. Hedge fund shorts. “Short selling across single stocks last week was the biggest on record going back to 2016”.

5. R3K earnings growth. And finally, “earnings growth for the median Russell 3000 stock is at its highest level in four years. Fundamentals are in line with the stock market broadening.”

ICYMI