U.S Equities finished flat in Tues trading although S&P cash touched July ’11 levels. Financials were among the weak. ES volume was a little better then yesterday’s embarrassing volume. The Vix got slammed towards the close. Might not be a bad time to buy some cheap protection. . The market is trading funny IMO. It is the year of the momentum stocks. The heaviest shorted/most hated stocks are gaining strength and the shorts are running even w crappy fundamentals that don’t support the moves.The Euro bounced off its morning 1.30 level to make fresh 2 month highs. Has Greece found someone to bail them out (rumors are LTRO) or is the whole world short the Euro and starting to cover(according to CFTC data)? USD is propelling the “risk on” trade for the time being.In trading Wed. all eyes will be on the 10 yr note auction and DOE inventory report. Look for big moves in WTI regardless and for the brent/crude spread to widen.
