May 17: Is smart money pivoting?
Today's economic calendar lacks "blockbuster news," but it's a day where speculative positioning data and long-term capital flows are speaking – and if we read carefully, we might see that large money could be quietly shifting.
The highlight is the TIC Net Long-Term Transactions reaching 161.8B, nearly four times the forecast. To me, this signals that institutional investors are still pouring money into American assets, especially bonds and stable financial products – and this could help the USD maintain short-term strength.
However, CFTC data shows that the speculative side is behaving quite divergently:
Crude oil and gold contracts are still being heavily accumulated – reflecting a defensive sentiment amid instability.
Meanwhile, the S&P 500 has been sold off more than expected (-122K), and Nasdaq 100 has also seen a significant decline, indicating a return of caution towards growth stocks.
In other currencies:
- JPY and EUR still maintain a positive speculative position but have not broken out
- GBP has seen a slight reduction in position, reflecting that investors are still not confident in a strong recovery of the UK economy.
What do I take away from today?
- If you expect the risk market to break out, you need to monitor ETF flows and US stocks closely. Currently, money is moving into safe havens.
- BTC and crypto could be negatively impacted if the USD remains stable and the stock market hasn't broken out.
- Personally, I maintain a watchful stance: if gold holds its momentum and the DXY continues strong, I will reduce short-term altcoin exposure.
