코인톡

DSMMA Morning Brief
06/18/2026
(please Like, RT and Comment 🙏)

------------------------------------

EXECUTIVE SNAPSHOT

POSTURE: Capital Preservation. Adjust to the Warsh reaction, but do not chase passive equity beta or duration. Wait on the front end and expect oil to keep fading.

Warsh changed the near-term asset map. The dollar weakness trade I expected from the Iran safety bid coming out is now off the table. The dollar held firm, the front of the curve took the hit, and long duration remained bid.

Equities remain extended, and C-MAPE is still only carrying 5.0% SPY. Passive equity beta has not earned its way back into the portfolio. If you need to put money to work, look under the surface at software and select healthcare names instead of chasing index beta.

SOFR is pricing multiple hikes, but it has been wrong by magnitudes before. The front of the curve now presents value, but it is still too early to attack. The bond market trends better than equities, and stepping in front of that too early is how you lose money even when you end up "right".

Oil has very few reasons to be bought unless the war fully restarts. Oversupply concerns matter more than SPR refills, and under 70 is now in play.

Gold is weaker near term because of dollar strength and the front-end move, but nothing Warsh said changes the longer-term allocation case. It remains decent to add on dips for long-term portfolios, but the alpha portfolio risk is high.

STRC closing at 89 is the first real stress signal in the BTC yield complex. The bear market is not finished yet, but the signs are finally starting to show. Wait for a FTX-style blow up.

------------------------------------

MACRO

Warsh’s first appearance on stage was successful. He walked back the idea that he was going to be a dovish puppet, while leaving plenty of hints that two-way action on the next rate decisions is possible. He floated the dollar higher, crashed only the front of the curve, and long duration remained bid. The removal of forward guidance will scare a lot of people, but for those of us in markets every day, it should be a huge advantage.

The main adjustment is that I expected a period of dollar weakness as the Iran safety bid came out. That is now out the window. The dollar held firm, the front of the curve took the hit, and long duration remained bid. The front end now presents great value, but you will have a very hard time convincing a bond trader of that.

Markets have personalities, and the bond market is very slow to move against established thinking. Fading it can be a death sentence. Even when you are right, you can still lose money. We have not added any SOFR positions for a long time for this reason. The Fed hiking into the end of the war is very unlikely, but if the market wants to price it, you cannot fight that just because you think it is wrong. Stocks mean revert. Bonds trend much better. Step in front of that too early and you will have a bad time.

While Warsh was handing out task forces like Oprah gives away cars, we also have to assume many of his big ideas fail through bureaucracy, entrenched establishment thinking, and poor execution. There is close to zero chance we get a full reworking of data collection methods or rid ourselves of outdated survey responses anytime soon. Government-tied enterprises are slow moving and inefficient. So is the Fed. Look no further than their building project.

The basic outlook after this meeting is positive for the dollar, okay for longer duration if you believe he is actually open to bringing inflation down, bad for gold in the near term but neutral longer term, and negative for the front of the curve. A lot of the front-end damage is already done, but it remains too early to attack those trades now.

The next meeting could be a complete 180 if oil drops under 70. So, strong opinions held loosely, or whatever trader aphorism you prefer.

------------------------------------

EQUITIES

The overnight bounce makes sense only because dip buying has become the default setting. Warsh’s first outing was not positive for stock indices. The 30-year is holding in, but the 10-year has faded, and if hikes remain priced into the curve, near-term equity risk premiums should rise. That puts a cap on equity rallies, even if stocks are great at looking through data and operating on a longer timeframe.

I would NOT be adding to passive equity risk here. If you need to put money to work, look under the surface at some of the laggards instead of chasing index beta. Software and select healthcare still make more sense than blindly buying the same crowded winners if you must.

Equities are unattractive, but I do not suggest raising any more cash at this point. That should have already been done. Now it is time to wait for the next pullback. Do not get FOMO because the market bounced overnight.

------------------------------------

BONDS / RATES / FX

SOFR is on its way to pricing multiple hikes, but people forget it has done this several times in the 2020s and has been off by magnitudes on both cuts and hikes. It is more of a snapshot of current dynamics than a predictor of anything, and I do not think it represents a valid view past the next Fed meeting.

That said, longer duration is holding in because Warsh is being taken seriously. The front of the curve is doing the same thing in the opposite direction by selling off. I do not believe Warsh had any option other than to come out hawkish. There was literally nothing to gain from looking like a Trump lackey and everything to lose.

I would not buy the dip in the front of the curve yet, nor would I chase duration here. I liked duration when the CCS models on equities and bonds were at extremes. That time has passed.

------------------------------------

COMMODITIES

Oil is fading, and I see close to zero reason to buy it. We have covered this topic endlessly over the last few months. Oversupply concerns far outweigh SPR refills and the other bullish arguments. Unless there is a full restart of the war, I believe oil will be trading under 70 soon enough.

Gold is in an interesting position, because the selloff yesterday made total sense. Near term, with dollar strength and the front of the curve crashing, gold was bound to sell off as well. I do not think anything Warsh said was negative for gold longer term. I remain in the camp that gold is decent to add to long-term portfolios on dips, but from an alpha perspective, the risk is high.

------------------------------------

CRYPTO (BTC)

STRC closed at 89, which is the first real sign of stress I have been waiting for before becoming interested in a BTC investment again. The complex needs a lot more damage, but we are finally starting to see these yield-farming scams take a hit.

We still need an FTX-style blowup to put the finishing touches on this bear market. We are not there yet, but the signs are starting to show.

------------------------------------

CCS / C-MAPE

Equities remain extended at 7.21, while rates improved to -4.37 but remain negative. USD held positive at 1.08, metals are near neutral at -0.09, and energy remains weak at -0.97.

Equity extremes remain concentrated in cyclicals, semis, and select large-cap names:

- Outright extended: JPM, RTY, XLI
- Approaching extreme: DXY, USDJPY, AMD, BAC, copper, ES, NQ, SMH, SPHB, UNH
- Outright oversold: CRM, NFLX
- Approaching washed-out: Bitcoin, ZF, EURUSD, palladium, XLC

Macro spreads improved under the surface:

- Credit strong
- Growth strong
- Cyclicals improving
- Financials weakening

Global divergence remains mostly unchanged:

- Global markets, developed ex-US, Japan, and Brazil remain constructive versus the US
- EM remains strong versus developed ex-US
- Europe, the UK, and China remain very weak versus the US
- China remains very weak versus EM

C-MAPE slipped again, with the decision score falling to 0.36 while staying in Capital Preservation. Current positioning remains defensive:

- 43.1% GLD
- 31.4% UUP
- 20.5% SHY
- 5.0% SPY

Equities remain extended, and C-MAPE is still only carrying 5.0% SPY. The model remains locked in Capital Preservation while broad beta stays out of the portfolio.

--------------------------------

Follow @PiQSuite for best News Source on the internet!

Disclaimer: The information provided here is for educational purposes and should not be considered financial advice. Markets carry inherent risks, and past performance does not guarantee future results. Please conduct your own research or consult a financial professional before making investment decisions.

All opinions are my own. **I am not a professional.** Please trade responsibly

--------------------------------

== Preparation Beats Prediction ==

@DSMMAprivate

--------------------------------

Good luck and God Bless!

- Nik "The Carny" Lentz