Currencies are at risk.

Commodities

Rice is up 1.43% since our “Rice is the answer” newsletter on August 28th and continues to outperform most commodities. Once that breaks, we might see a nice topping out of commodities. Agricultural commodities are strong as well.

Remember, trading one asset class is trading blind.

Currencies:

US Dollar is ripping to its highest level in 20 years.

When you have a relatively strong economy and a central bank that is radically raising interest rates to prevent inflation your currency is going to go up.

Major currencies are breaking: JPY and GBP are falling to record lows. EURUSD at .97

No signs of trend deterioration for the US Dollar. Overextended yes, but the trend is still intact. EM’s debt crisis will be real

Short trash EM and DM currencies against the dollar. Below are a few major pairs to monitor.

The QQQ is at a breaking point.

The rise in real rates is leading the charge down.

Great chart to get an idea of oversold conditions.

The real volatility is in the "bond VIX index” (MOVE). A mean reversion play is here.

One of the largest bond ETFs (TLT) is witnessing its deepest draw-down in history (-37%). Imagine a 60/40 portfolio right now.

The US Dollar is parabolic.

Remember:

The last thing the fed needs is the market to have even the slightest inclination of a dovish pivot. If that happens, then the market will rally, which in turn will pressure the fed to raise rates even more aggressively. They need to pound the economy/market into the sand first.

Risk always wants its return payment. NOT INVESTMENT ADVICE.