Getting Granular: Equities Cheap vs. Credit?
We plot the path HYG & JNK have traveled against SPY over the past year in the chart below. They have all tended to track together over the past year. Just as equities appeared expensive vs. credit in 2Q12 in front of…
Analog Update
Per my email this morning about only giving this market a day or two worth of leash before giving up and turning structurally bearish, the analogs call for an insane launch higher, basically begining in and around this week. As…...
The SSEC Likely Continues Lower Though Its Irrelevancy Continues to Grow
We’ve been of the opinion that if the SSEC were to continue lower, it would not necessarily be indicative of an imminent global slow-down/recession/equity collapse. That thesis is largely derived from the chart below, which plots the path the SSEC…
CFNAI Suggests the Fed Has Destroyed the Market’s Discounting Mechanism Over Past Decade with Pay-Back Being Increased Volatility
Stepping away from the “only prices matter” meme for a second to highlight some more work on the Chicago Fed National Activity Index (CFNAI). Historically, when the rolling 3 month average of this index hits and/or dips below a reading…...
SSEC Finds itself at Another Important Support Zone as FXI Faces Resistance
All the way back on August 27th we noted the SSEC was in the process of breaking below long-term support dating back to 1994. At the time, we noted that while such a break was unlikely to be an incremental…
After Losing 98% of its Value, Is this Retailer Worth a Trade on the Long Side?
At just under $2.00, RSH finds itself down 98% from its all-time highs in the late 90s. We’ve talked a lot about old-line retail on this site and in emails, with these discussions largely centered around the likes of BBY,…...
Some Additional Evidence that Suggests Fear Levels May Have Recently Become too High
More on the sentiment side of things today. The chart below shows the proportion of Rydex assets that sit in money market funds as vs. total assets at the fund family. The higher the %, the more people are fearful…...
Did Sentiment Get Too Bearish, Too Quickly Yet Again?
Had struggled to find anything that was suggestive of excess bearishness recently until stumbling across this last night, which I pulled from SentimenTrader. The chart below shows the net long or short position that Hulbert Financial Digest newsletter writings are…...
Post Bubble Analog Suggests Housing Stocks Closer to Full Valuation than Nat Gas
In this post we highlight our post bubble analogs to see how close housing-related stocks and Nat Gas have come to lessening the valuation gap they’ve recently exhibited vs. where other bubbles have tended to trade some ~375-400 weeks after…...