February PPI came in at twice expectations: 0.6% versus 0.3%.  In a replay of the CPI print, stocks dipped for a few seconds before resuming their overnight ramp as algos were more focused on VIX dropping through its 50-DMA just in time for OPEX.

VIX did pop above the 50-DMA…for several seconds. It got better.Indicators such as RSI still remain on edge.continued for members…

Stocks should have already backed off. But, because they’re still hanging around the 1.272 and VIX is so close to that TL of support from mid-Dec, it’s too close to call.

I would love to make a big, bearish bet here…

…but this is a setup for a push above the 1.272, which would kill the bears. It’s hard to ignore, especially as we also approach the end of Q1. Currencies are favoring the bears only slightly, with the USD edging higher on the back of higher interest rates which are, of course, responding to the hotter inflation data.

Note that CL and RB are still pushing higher, which will only add to the prospect of higher inflation…

…which is reflected in TNX’s push through its SMA200.The 10Y is now 22 bps above the Mar 8 lows and 43 bps above the Feb 1 lows.

With all the hot data being released over the past week, you’d think the market was getting nervous. If it were actually a true “market,” it would be.  There’s no way that the data support the idea of any interest rate cuts any time soon. The algos could care less…