Systematic Model Update

On 8/20 we noted our systematic model had generated its first sell signal since March. We noted at the time the signal itself meant nothing until we started to see choppy price action and/or some big intra-day reversal(s). Clearly, into…...

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A Decade-Long Under-Performer, this Industry Could Soon See that Trend Reverse

First chart is the ratio of the DJ Specialized Consumer Services Index (DJUSCS) vs. SPX. This index is a hodgepodge of sorts but includes education & training companies, which are this post’s focal point as a source of potential out-performance…....

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TASR Up 20% in Three Weeks as Defense Industry Out-Performance Thesis Bears Fruit

TASR Up 20% in Three Weeks as Defense Industry Out-Performance Thesis Bears Fruit

On October 2nd we noted in a post that companies in the defense industry were likely to out-perform the broader market moving forward. In that post we stated the following: “…we would anticipate that defense stocks could out-perform for some…

Spread Trade Opportunity in Semis

The chart below plots the ratio of AMD vs. INTC. With AMD’s dramatic decline of late the ratio sits on long-term support line (1). A potential spread trade here would be to go long AMD and short INTC. The trade…...

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 BBY Down 22% Since our Bearish Post on 7/12 Despite 5% Rally in SPX Over Same Period; Much More Downside in BBY Likely

BBY Down 22% Since our Bearish Post on 7/12 Despite 5% Rally in SPX Over Same Period; Much More Downside in BBY Likely

Though the post had been ┬ápass-word protected up until today, we had a rather bearish post on BBY all the way back on July 12th where we suggested the stock could trade much, much lower from its price at the…

Continue to Believe that China Can Remain a Source of Out-Performance

Historically we’ve focused this thesis on the idea that such out-performance would come via the SPX. That said, with a little bit more digging, the ratio charts below also suggest that the SSEC can out-perform the companies that have historically…...

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Crude May Continue to Under-Perform Other Risk Assets Such as Equities

Crude May Continue to Under-Perform Other Risk Assets Such as Equities

The chart below plots the ratio of crude oil vs. the SPX. Earlier this year the ratio broke support line (1) which dated all the way back to 1998 – in effect, crude’s nearly 15 year trend of out-performance vs….

Analog Update

Focusing on the “4th consecutive annual gain” analog in this post. Heading into 4Q12 the analog suggested the potential for an immediate sprint higher for the entirety of the quarter or weakness in its first half, followed by strength in…...

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Although it Sits on 10-Year Support, Coffee Could Continue to Disappoint over the Intermediate-Term

The chart below reflects the fact that coffee futures sit on 10-year support line (1) dating back to 2002. It also highlights the fact that commercial hedgers, who more often than not tend to get inflection points correct in the…...

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Are Prices Really the Only Thing That Matter?

Are Prices Really the Only Thing That Matter?

If so, what are the prices of the two asset classes below suggesting about the likely winner of the upcoming U.S. presidential election? Or, am I reading too much into the tea leaves here?