In last week’s institutional CA RV Weekly, I had a second market commentary on why I thought the June meeting was overpriced. I discussed why I thought there was a headwind to getting the Fed to ease in June. Unfortunately, I thought a “macro reader” would be more interested in the terminal Fed Funds rate than the arguments for why Q2 meetings were less than 5 bps overpriced. But this goes back to a few things I have been saying for some time: (1) trading direction in the short term is a coinflip, (2) look for asymmetric opportunities to express your “directional” views and (3) beware the growing number of trend-following algos. Number 3 is my topic of discussion today.
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