PickAlpha Evening Insights | 2025-12-23 - Three Trades For Tomorrow
• Stocks mixed as strong GDP and Treasury auction pushed rates higher; consumer confidence cooled. • No material after-hours earnings or policy headlines. • Three Trade Ideas.
PickAlpha Evening Insights | 2025-12-23 - Three Trades For Tomorrow
• Stocks mixed as strong GDP and Treasury auction pushed rates higher; consumer confidence cooled.
• No material after-hours earnings or policy headlines.
• Three Trade Ideas.
Market Wrap
Market Recap — A growth surprise and a busy Treasury auction set the tape today; shorter-term risk appetite softened after a consumer-confidence slip. BEA’s advance estimate showed Q3 2025 real GDP up 4.30% (annual rate), while the Treasury sold $70B of 5‑year notes at a 3.692% high yield and 2.35 bid-to-cover. Regional manufacturing and confidence data were softer—Richmond Fed’s composite fell to 5 and The Conference Board’s headline confidence dropped to 89.10—while Kroger boosted buyback authorization by $2.0B.
Intraday — From 08:00–16:00 ET markets digested Kroger’s $2.0B additional repurchase authorization and BEA’s 4.30% Q3 GDP advance estimate early, then at 10:00 The Conference Board reported headline consumer confidence down to 89.10 and the Richmond Fed showed its manufacturing index at 5 with employment at 9; into the afternoon the Treasury auctioned $70.0B of 5‑year notes at a 3.692% high yield with a 2.35 bid-to-cover.
After Hours — 16:00–20:00 ET contained no material after-hours earnings releases or major policy/court headlines in the provided feed.
Three Trades For Tomorrow
1/3 Short $TLT — If initial jobless claims at 08:30 ET on 2025-12-24 print at or below the 225,000 consensus (roughly in line with the 224,000 prior), short $TLT between 09:30–10:00 ET. Use a 1.5% stop above entry and target a 1.5–2.0% gain, exiting no later than the 14:00 ET recommended…
Initial jobless claims around the 225,000 consensus and 224,000 prior offer a timely signal on labor-market slack. A print at or below consensus points to a still-tight jobs market, reducing near-term Fed easing expectations. That typically pressures longer-duration Treasuries, making $TLT a clean way to express a near-term bearish duration view into the holiday-shortened session.
Trade credibility: actionability 8.0 | timeliness 9.0 | clarity 8.0
2/3 Long $XHB — If the 07:00 ET MBA release on 2025-12-24 shows purchase mortgage applications rising week over week while refinance applications are flat or lower, go long $XHB between 09:30–10:00 ET. Use a 2% stop below entry and exit by the 13:00 ET equity early close on 2025-12-24.
MBA mortgage applications at 07:00 ET provide an early weekly read on housing demand and rate sensitivity. A rise in purchase applications relative to refinancing suggests stronger homebuyer activity, supportive for homebuilder sentiment. $XHB is a direct housing equity proxy, so positioning long after a stronger purchase index aligns with the event’s demand signal.
Trade credibility: actionability 7.0 | timeliness 8.0 | clarity 7.0
3/3 Short $TLT — If the 7-year note auction at 11:30 ET on 2025-12-24 tails (high yield above the when-issued level), short $TLT immediately after results. Place a 1.0% stop above entry and aim for a 1.5–2.0% gain into the 14:00 ET recommended fixed-income early close, closing any remaining exposure no…
The $44.00B 7-year note auction is a key test of demand in the Treasury belly, with bids closing at 11:30 ET on a holiday-shortened day. A tail versus the when-issued level would show weaker demand and push 7-year and longer yields higher. $TLT, as a long-duration Treasury proxy, should underperform on such an outcome.
Trade credibility: actionability 7.0 | timeliness 8.0 | clarity 7.0