It’s difficult, but not impossible to imagine the bullish scenario for 2023. Today is my best effort to present the alternative hypothesis to the consensus bearish view on the US economy and stocks. It’s still not my base case, but I am keeping an open mind.
Sell rallies in USDJPY and stocks but risk/reward for shorts in either or both is poor right here.
2022 was a mirror of 2021. Short term risk reward for USDJPY and cross/JPY shorts looks poor.
Tough to pile into risky assets given the size of the moves already and the lack of follow through after NOV CPI and FOMC tomorrow.
Friday’s price action was hard to explain (strong PPI / weak USD / strong stocks). Makes CPI tougher to handicap, even if you knew the number.
Results from my recent 2023 outlook survey. Mostly bearish.
PPI doesn’t usually come out before CPI. This is useful information.
I like AUDUSD and SPX to find a bottom around here. Things are not that bad.
Forecasting is hard .. Plus EUR seasonality and BoC thoughts.
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