Does a Major Reflationary Event Stand on the Horizon?
The PCAC Index (US PPI for all commodities) is plotted on a monthly basis below dating back to the early 1900s. As of the last print (Jan-16) and following a significant multi-year decline, it was a hair away from reaching…...
Multi-Decade Break-outs in Gold vs. Various Industrial Commodities Signals Major Monetary System Change Afoot
Proportional end demand by the industrial sector is exceedingly larger for crude (all), copper (all) and silver (~50%) vs. gold (~10%-15%). Keep the above in mind when looking at the three charts below which plot ratios of gold vs. all three aforementioned…...
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…...
This Industrial Company’s Break-Out from Two Years of Consolidation is Bullish, but Also Signals the Potential for a Similar Move in Broader Equities
In the chart below ITW has, as of today (if gains hold), officially broken out from a ~two-year consolidation/flag pattern b/t lines (1a) and (2a). The stock should be bought on this break-out. However, at the same time, note how…...
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…...
GREXIT
If one recalls, one of the first-ever posts on this site provided a framework of what would likely happen to Greek stocks and the Drachma were the country to exit the EU. It’s been nearly four years since that post and Greece has…...
A Look at Gold Miners
I’ve relentlessly made the case for gold on this site over the past year or so, believing a major bottom was approaching. Less focus has been placed on the miners, but it’s worth visiting that group as the rally they’ve…...
TED Spreads Back on the Rise
I spent a good deal of the site’s Dec-15 real estate focusing on TED spreads, particularly the latter half of that month, and their rapid ramp higher as we exited 2015. In each of those Dec-15 posts I strenuously emphasized that…...
MSFT Attractive vs. AAPL
I’ve beat the tune of the bullish MSFT drums on this site dating back to 2013. Most recently I suggested a spread trade b/t it on the long side and an INTC short on 1/9/16 in this post using this…...
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…...