Despite Today’s Decline, Nothing Has Technically Changed with Respect to GOOG
We’ve been favorably disposed to GOOG dating back to early September as this post suggests here. Because we recently had a victory lap post reminding readers that this call had heretofore been the right one, it’s only fair that we point…
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…...
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…...
Relative Strength of DJ Investment Services Index at a 20 Year Low
I believe we discussed informally (phone, email, etc.) the possibility that investment services / asset manager-type companies could outperform over the coming months. This thesis and discussion revolved around the following: 1) Potential for a material rally in equities, based…...
In a Down Market and in Only 10 Days, Our Long XLF, Short Regional Bank Spread Trade is up 400+ bps
Since October 5th when we suggested the possibility, the ratio of the KBW Regional Banking Index vs. the XLF financial ETF has declined 420 bps! In other words, our suggestion to long the XLF and short regional banks has generated…
Russell 2000 Forming a Classicly Bullish Technical Pattern That Should be Resolved with Higher Prices
The Russell 2000 is forming a classicly bullish cup & handle pattern in the chart below. We typically hesitate to talk about technical patterns like these as we believe they are the purview of bloggers/market practitioners that use only technicals…
Semis Likely Have More Relative & Absolute Downside Remaining
The chart below plots the ratio of the SOX vs. SPX. Note the ratio doesn’t reach intermediate-term support region (A) until ~3% lower. More material support doesn’t come into play until line (1), some ~15% lower. Additionally, the 52 week…...
As a Group, Coal Appears to be Breaking Out & Could Continue to Out-Perform
For some background on our thoughts on coal, please see these previous posts here and here. Since our original post on the group all the way back on August 9th, the DJ Coal Index has risen 22% vs. only a…
Defining Alpha, FXI Has Out-Performed the SPX by 700+ bps Since We Suggested as Much a Month Ago
On September 7th we had a post detailing our thoughts on FXI and our belief that domestically listed Chinese equities were about to begin a period of out-performance vs. the SPX. In that post we specifically noted the following: “A long…...