New Year New Fear

The first several trading weeks of the year are going to be very informative as to how true trading conviction was limited going into the end of the year. There's definitely a case to be made that early January we'll see a higher willingness by real money participants to start the long-awaited process of reaching further out the curve. We're not interpreting what has occurred during the final few trading weeks of December as the departure point for this cyclical move. Instead what we're attributing the steepening to is position squaring into year-end as well as a market that is seen very thin volumes, limited liquidity and a collective lack of willingness to get in the front of any price action of note