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The market has been more volatile on auction days for longer duration bonds. Ignore the comedian accounts on here who claim the supply of USTs doesn't matter nor its composition. Give Andy Constan Derivatives Don credit for being the correct voices on this.

Last week the 10y yield dipped to 4.32% for a day. That was all it took for homebuyers to step in. Purchase apps +10% in a week to highest level in a year and refi +16%. Housing is doing much better than people expected.

Stocks look exhausted and a bit of a news failure action on the much colder than expected CPI. Took profits and sitting it out for a bit.

US ordering evacuation from multiple Middle East embassies. This could be Iran. Be careful.

It’s the age of tails

I don’t know if anyone has studied this but this cycle has to set the record for the most supply shocks in history

Imagine that the garbage can Ayatollah is removed from power. Iran has a well educated population w/median age of 33 & a high fertility rate. 80% reject this regime. The entire Middle East transforms into a region of prosperity. Not a today story but one can dream.

My oil model flagged it as cheap since April, and I told clients to expect Iranian negotiations to fail and a strike to come. Admittedly, they did better than me on this trade but that makes me just as happy. Update to the model and commodity outlook. dannydayan.substack.com/p/quick-oil-up…

It’s time to think of new tails. This year is not going to get any less weird. I am working on one that looks very asymmetric and hope to have the note out this coming week. Stay tuned.

Risky Neutrality is the current Fed stance. The 4 most important charts in macro are below, as well as my FOMC preview note. dannydayan.substack.com/p/risky-neutra…

My group chat has figured out the best trading strategy. Today the right approach was to fade the oil rally, then fade yourself and the decline by buying it again. Fade^2. Hope that helps!

The Dollar looks poised to make a comeback.