by Tyler Durden
Friday, Feb 26, 2021 - 10:04 AM
Over the past two months, when unleashed animal spirits forced Citigroup to literally get a bigger chart measuring market euphoria, one analyst was warning that pain was coming. We are talking about Nomura s Masanari Takada, who long ago replaced a certain
gandalf with his market predictive skills, who first warned that a burst in 10Ys above 1.20% would spark CTA liquidations and shorting, and that 1.50% on the 10Y would emerge as a critical stop out catalyst leading to an even bigger selloff in rates coupled with a puke in broader equity markets.
Well, this morning the Nomura quant takes a well-deserved victory lap, writing that while the rise in yields was beyond what we expected, but a risk-off turn much as we expected, and elaborates:
How Ugly Will It Get: CTAs Are The Most Short Treasurys Since 2018 And Getting Shorter
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17Feb2021 Midday Update: Down Day For Wall Street, DOW Briefly Records Green But Slips, At 12:30 ET Down 50 Points, Silver 27 27, US Dollar Stronger 90 94, Bitcoin Higher 51200
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