Chicago Fed National Activity Index Negative for Six Straight Months for First Time Since September 2007; What’s it Mean?
With its reading of -0.87 in August, the Chicago Fed National Activity Index (CFNAI) has now printed in negative territory for the six consecutive months. This is the first time we’ve had six consecutive negative prints on the index since September…...
Nasdaq Clearing 12-Year Resistance; Time to Pay Attention to Names/Themes That Worked in the Late 90s Again?
A little over a week ago on September 10th, before Fed day last Thursday, we noted that it appeared the Nasdaq was finally clearing its 50% Fib retracement level off the 2000/2002 highs/lows, something it hadn’t been able to do for…...
INTC Sitting On Quarter-Century Support Dating Back to 1986; Ratio of INTC vs. XLK Near All-Time Low
The chart below shows that INTC sits at quarter-century support line (2) dating back to 1986 while it is caught in a long-term consolidation pattern b/t lines (1) and (2). At the same time, the ratio of INTC vs. the XLK…
What Sectors & Industries Are Likely to Out or Under-Perform Moving Forward?
Please refer to my post yesterday on commodities under-performing on a relative basis over the past week despite the Fed’s pledge for infinite QE. Next refer to this post, which further emphasizes my general belief that commodities et. al under-perform moving…...
Updating the Comparison of the SPX Rally off the August 2011 Weekly Closing Low vs. Other Major Rallies Through History
The chart below compares the rally off the August 2011 weekly closing low in the SPX (black line) vs. the average rally off of some of history’s other major lows. The red line is the average rally off the 1962, 1974,…...
Long Gold / Short Equities Has Been a Generational Trade That Will Likely Continue
Since 1999 the ratio of the SPX vs. gold has declined 85%. That’s +485 bps annualized for somebody who was short the index and long gold the entire time. In the end, the logic for this trade remains quite simple:…
Nasdaq Attemping to Clear Key 12 Year Technical Milestone
Last week, as the chart below indicates, the Nasdaq Composite index appears to have finally cleared its 50% Fib retracement level formed between its highs in 2000 and lows in 2002. This is a big deal in our opinion – it’s taken the Nasdaq nearly…
Financials Signaling Sustained Upside in Risk Assets?
The chart below shows the ratio of the SPX vs. XLF – when the ratio moves lower, financials out-perform. The ratio is now breaking below support line (1). This is important as every time the ratio has hit line (1) over…
Case for Airlines Out-Performing Continues to Build
All the way back on May 30 we highlighted the emerging case for Airlines sustainably out-performing the SPX. We didn’t take a strong, high conviction stance on this belief, but merely stated the “possibility” for this happening was becoming stronger. At…
Given Their Tight Correlation, Could Weakness in Lumber Prices Drag Housing Stocks Lower Too?
During the week of 8/18/12 lumber prices gapped open to start the week ~275 bps higher and at the time, were already up an astounding 38% YoY. Lumber is typically a rather subdued commodity so we thought the gap higher…...