The 7-Year auction drew a D grade with foreign bid at just 60.78%, while leveraged funds pile into two crowded corners: yen shorts at their thinnest two-year level and Russell 2000 shorts near the same extreme. Sentiment's elevated-reading count doubled to 12 from 6 in a week, even as liquidity, Fed, smart money, and macro all flash bearish. The FOMC lands in nine days. A Fed miss into a market already crowded short yen and small caps forces the unwind through the same door everyone picked.