RBC Warns January Is Setting Up As A “Massive Mean-Reversion” Month

Monday, December 12, 2016
By Paul Martin

by Tyler Durden
ZeroHedge.com
Dec 12, 2016

Following Friday’s report by RCB’s Charlie McElligott which sought to answer “THE” question every investor is asking, namely “what could derail this rally”, today’s the cross-asset strategist has released a follow up analysis in which he warns that even though the bond battering continues – and is likely to continue for a while – the market is now being set up for a “massive mean-reversion” counter-trend rally as soon as January.

His arguments why are presented below:

Big Picture: BOND BATTERING CONTINUES BUT SET-UP FOR JANUARY COUNTER-TREND REVERSAL

Bonds further ‘wearing it’ on multiple-fronts this morning (monster TY put block overnight, likely hedging against MTM losses being accumulated–H/T Alex Redhead) as once again, the 5+ year rates trader playbook is torn-up with weakness during the Asian session overnight—five points I’m highlighting:

The Rest…HERE

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