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….
More Thoughts & Analysis on the Nikkei & Yen
Here are some background posts on how our thoughts have progressed on the Yen and Nikkei here, here, and as of last week, here. With these posts in mind, we present the Yen and ratio of the DJ Global Index…...
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…...
Where are the Most Appropriate Places to be Levered & Long in Anticipation of a Cycle Bottom?
What I’ve attempted to do here is put together the easiest, yet most robust macro tool that I could fathom, that each of you can use in the future if for some reason(s) our working relationship end. In its simplest…...
On a Relative Basis, Gold Miners Face Resistance
The chart below plots the ratio of Arca Gold Miners Index vs. the SPX. From 2001 to August 2011, the ratio rose to 1.60 from ~0.15. This means gold miners as a group out-performed the SPX by a factor of…
1986-1989 = 2010-2013?
I wanted to officially catalog this comparison on the site instead of just communicating about it via email and also provide some granular detail on where the market may decline to. As you all know, it seems like the parallel…...
Are Market Internals Weakening?
The chart below plots the SPX along with the ratio of NYSE advancing issues vs. total issues. As you can see in region (A), the ratio has put in a succession of lower highs and lower lows over the past…
Updated Analog Chart of YTD Rallies in a 4th Consecutive Up Year
Are we going to get our 1,540-1590 SPX target by YE? Charts below are updated with price action as of 10:30 AM EST and assumes DJIA 13,660. Remember, these analog charts are of the DJIA and we’re extrapolating the conclusions…...
Market Absorbing Significant Supply from Swing Highs in Spring 2008?
The tape has felt incredibly heavy to us over the past few weeks since we peaked at SPX ~1,475 on 9/14 – most gains are quickly puked and we’re now down ~170 bps from that post QE-infinity euphoric level. There’s…
Oil’s Decline Helping our Airline Out-Performance Thesis
We’ve re-visited the case for airlines out-performing two times on this site. Our last post on 9/7 was the catalyst for initiating a long spread trade in the group with a corresponding short in the SPX. On 9/14, we then…...