Additional Signs of Reflation and Implications for Gold
Earlier today in this post I discussed that the Producer Price Index for all commodities, or the PCAC Index (Bloomberg ticker), was signaling the potential for a strong global reflationary event to occur in the intermediate-term. I wanted to build on…...
Should History Hold, USDMXN at Multi-Decade Channel Resistance Signals Potential for Pivot Higher in Risk Assets, Inflation
In the first chart below I show USDMXN (USD vs. Peso). For nearly two decades back to the latter part of the 90s USDMXN has traveled in an upward-sloping channel b/t lines (1) and (2). Over time it has reached…...
SPX Technicals Suggest Fair Value of ~1,400
Perhaps the simplest, yet most elegant way to think about fair value for the SPX is to view it through the prism of the long-term technical chart below. In that chart you’ll notice the index has traded in an upward sloping…...
The Federal Reserve’s Epochal Bubble-Creating, Cycle-Breaking Abilities
The Nasdaq reached a new all-time high in late-2014, surpassing the previous one it put in place in the early 2000s at the height of the tech bubble. This successful reclamation project was quite a feat – in accomplishing it…...
Has Russia Signaled the end of the Global Emerging Market Bear Cycle?
Over and over we have used the DJI over the course of 1904-1914 as an analogy to emerging markets (via EEM as a proxy) from 2004-current. Conversely, we’ve belabored the idea that 1937 and/or 1974 are the best analogies for…...
Massive Break-Out in Trade-Weighted USD vs. SPX Signals Intensification of Global Financial Stress
In the first chart below I show a scatter plot of the weekly returns in the trade-weighted USD (USTWBROA; y-axis) vs. gold (x-axis) dating back 20 years into 1995. The red dot is this week’s data point. Note that this…...
SSEC Has Another ~20% of Additional Downside and is Likey to Remain in Relative Free-Fall
On the heels of our late Dec-15 post that suggested China’s depression was set to intensify in early 2016, I’ve updated that view via the SSEC plot below. The chart pattern over the past 18 months – base, large run…...
CRB vs. USD Has Reached 40 Year Support, But Can it Hold?
On 12/17/15 in this post we highlighted this chart which showed that the ratio of the CRB Index vs. USD was fast approaching a 30-year support line. In reality, if we extended that support line left into the early 70s…...
USDRUB Breaks out of 18 Year Channel to the Upside (The Loss of Fed Independence)
In the chart below at (A) USDRUB has broken out of a ~18-year channel b/t lines (1) resistance and (2) support to the upside. Every major swing high and low for the pair has come on these respective channel lines over…...
Nimr al-Nimr as Franz Ferdinand (Echoes of 1914 Update)
As far back as 7/23/15, three weeks before the CNH devaluation and a full four weeks before global risk assets began plunging, I laid out what I thought was a compelling case for the period of 2004-2015 for emerging market equities…...