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The month that undid two extremes — and crowned no one (Sep 2022)

Episode

The extreme

There are months when the market builds a conviction. September 2022 did the opposite: it spent thirty days unwinding old excesses without signing off on any new one. The commodity that the prior month had exiled returned from banishment; the haven everyone was fighting over gave back half its premium. Both ends yielded to the center — and the center crowned no one.

In numbers: the Commodities/IBOV ratio went from -2.17 (a rare exile, nearly two and a half deviations below its own mean) to -0.94, an advance of 1.24 of deviation, the largest on the board. On the opposite side, the financial sector's premium shrank by half — z from 2.20 to 1.12. The Ânima index cooled from 64.4 to 53.2, the intermarket grid eased from 45.18 to 42.59 (moderate risk-off), with the Selic at 13.75% and the dollar at R$ 5.24.

What happened next

The question September left open was answered — to the downside. In December 2022, the intermarket grid plunged to the floor of the scale, 0.17, in heavy risk-off, and the mood that had only cooled turned to pessimism: investor disposition fell to 30.4. In March 2023, the internal risk axis even jumped, but the composition hardened on the defensive (cyclical/defensive at -1.23, with Utilities and IFIX in the lead), while sentiment sank to 20.6. Only in September 2023 did mood and prices finally agree — both heading for shelter, Utilities at 1.38 of deviation.

What did not happen

The commodities' return was not a return to leadership: it was the exhaustion of a punishment, not a vote of confidence — three months later the whole house turned off the lights. Nor did the retreat in mood stall at neutral; it kept falling to 30.4, then to 20.6. And undoing extremes was not the same as calming: the symmetry September gave back preceded a deeper aversion, not a truce.

The honest verdict

The Radar read the month correctly — no side chosen. But "no side" is not equilibrium; it can be the pause before the fall. The neutralization of the excesses marked the end of August's distortion, not the beginning of a normalization. Anyone who read the symmetry as peace did not see the floor December was bringing.

Continue reading: The house in the dark (Dec 2022) · The rough start of 2023 (Mar 2023) · The shelter, not the applause (Sep 2023) →

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Characters: Structure (intermarket)