JPY Pump Failing As Momos Refuse To "Fight The Fed", Small Caps Slump On Yellen Warning

Everyone knows that youÂ “don’t fight the Fed”Â – and sure enough, traders are selling momo, social media, and biotech stocks, sending the Russell 2000 and Nasdaq to the lows of the day.Â Despite the best efforts of USDJPY momentum ignitersÂ – which has now shifted to tracking Treasury yields, pushing them modestly higher. No bounce at all in broad US equity markets (though we expect the spin to be a rotation from growth to value once again very soon). Gold jumped on the dovishness but fell back to unch as did the USD.Â The S&P 500 is now in the red post-payrolls. Summing it all up – saying that these sectors are ‘stretched’ but the market is within ‘norms’ just won’t cut it… Yellen is losing control and this level of specificity (and honesty) implies some degree of panic at the Fed.