Morning Note

Asian equities picked up where the U.S. left off Friday, with all but 2 of the 16 markets we track closing higher last night. Europe’s following suit this morning, with only 3 out of 19 bourses trading lower this morning. The U.S. (save for small caps) remains in rally mode; the Dow’s up 310 points as I type, the S&P 500 is trading higher by .9%, the Nasdaq’s up 1.3% and the Russell 2000 is flat.

Oil’s down a percent, gold’s up $4, silver and copper are both rallying hard, up 2.3% each, and ag is mostly lower so far this morning.

Volatility measures are entirely resisting this morning’s cozy mood. The VIX (SP 500 vol) is up 2.4%, VXN (Nasdaq vol) is up a whopping 7.9%, RVX (smallcap vol) is up 1.4%, and VXD (Dow vol) is up .7%, just to name a few. One volatility index we track that’s trading notably lower this morning is GVZ (gold), it’s down 4%; which makes sense given how the price of options protection is being bid up (hedging against/exploiting a fall) across the equity space.

Yesterday I highlighted for you multiple studies that we update weekly, one of them being our own fear/greed barometer. While the contrarian indicator currently scores bearish, at +25 (oscillates between -100 and +100), only moderately so. The MSCI Growth Index Fear/Greed Indicator, per widely-followed SentimenTrader, on the other hand, says I’ll call it on-one-side-of-the-boat risk is at an exceedingly dangerous high:

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