Analog Update: More Near-Term Downside Likely but Cyclical Outlook Remains Bullish
We’re updating our 4th and 5th consecutive annual gain analog in the charts below. First chart displays those years in history that have represented 4th consecutive annual gains. As we have often noted, including in our 10/24 analog update, if…...
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…...
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…...
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…...
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…...
Set-Up in CAD$ Appears Unfavorable; Could Lead to Continued Softness in Crude, Out-Performance in Airlines
We find the set-up in the CAD$ unfavorable, both technically and from a sentiment standpoint. Technically, the FX finds itself facing very stiff resistance region (A) which marks highs dating back to 1972 as well as 2008/2011. At the same…...
If U.S. Bonds are the “Big Short” of the Next Decade, it Likely Means Japanese Equities are the “Big Long”
We got to thinking yesterday and came up with the chart below… It plots the ratio of the SPX vs. Nikkei against the 10 Yr UST price since 1998, when things really started going “global” with LTCM, the Russian FX…...
The Case for Euro Financials Out-Performing the Broader Market Remains Compelling
Here is some background on how we’ve approached this subject in the past here and here. In a nutshell, we’ve been favorably disposed to Euro financials since May and have believed they could out-perform both the broader market and their…...
Long CREE / Short PANL Spread Trade Up 12% Since September 27th Post
Wanted to update this idea/thesis given the nice pop in CREE today. On September 27th we had a post that noted a spread trade opportunity had emerged in the flat panel/LCD space. That post can be found here and the chart…...