17Jan11:39 amEST

Sorting Through Winter Battles

I was just forced to cut a gold miner long trade, as the (likely) threat of no imminent March rate cut seems to be pressuring gold more than I expected. 

Of course, you know that I also am not expecting a rate cut, either, and have several other positions on to benefit from that, including an outright short on bonds as well as a bearish bet on the rate-sensitive REITs in the IYR ETF (daily chart, updated below). 

As you can see, the REITs benefitted immensely late last year from the market's overzealous view of tons of rate cuts coming in 2024 for a soft landing. But now, perhaps, a reckoning sets in, after we got strong retail sales figures this morning which pushed rates higher yet. 

Overall, as long as IYR holds below $90 here I am looking for a larger unwind into February in the sector, with the potential for the selling to intensify if the January 31st FOMC hints that a March rate cut may be off the table. 

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