Archives: Weekly Market Outlook

The Physics of Shorting

Keith Schneider | April 13, 2019

US and Global Equities continued to rally, with the NASDQ 100 +.63% for the week. It is just a hair from making new all-time highs, as shown on the chart above This rally off the Late December lows is a classic V pattern that has taken 6 months to complete. This V pattern, so late in the economic cycle is highly unusual. Is this the new physics of shorting, where seller’s equity gets sucked into

Musk Melts Down, Emerging Markets Emerge

Keith Schneider | April 6, 2019

Global Equites melted up, gaining over 2.5% on average this week led by Emerging Markets. Norway’s highly respected $ 1 trillion-dollar sovereign wealth fund is dumping Emerging Market bonds and moving into Emerging Market equities. This should be considered a smart move by smart fund managers. US Equities were handed a nice surprise on Friday as March showed good employment growth. On the flip side, wages stagnated for those that are employed. The takeaway, its

Pick Your Poison

Keith Schneider | March 30, 2019

Look at the table above. The 6 month returns the picture is not pretty. The sectors that had positive returns are safety plays One the other hand, the last three months paint an opposite story. Will the short-term strength persist and overcome the longer-term overhead supply? Meanwhile, all four key U.S. equity markets bounced this week up about +1% on average. Gold retreated as did old Miners, and both look technically vulnerable However, copper, an

A Colorful Week: Yellow Vests and Red Flags

Keith Schneider | March 24, 2019

Risk Gauges flipped 100% negative (see risk gauges below) as Global Equities closed on their lows for the week. Member of our Alpha Rotation service have seen the progression of the market’s deterioration in the risk gauges shown below (read right to left). MarketGauge BigView Premium Risk Gauge: However, growth stocks that populate the NASDAQ 100 were able to eek out a small gain and still look good technically. Geo-political stress that emanates from economic

Risk Gauges Head South of the Border

Keith Schneider | March 10, 2019

U.S. Equity markets reversed their relentless climb up this year and dropped between -2 to -4% for the week. Risk Gauges flipped 100% negative by the end of the week, despite the rally into the close on Friday. So, I’m not sure what my favorite piece of tabloid news was this week, but certainly, David Dukes support of Omar Ilhan was a top contender. Seems like a merger is in the making and we will

Good Junk

Keith Schneider | March 3, 2019

Last week’s “Risk On” mood was most clearly demonstrated by the chart above which shows that despite the jump in rates, high yield debt, (Junk) out-performed the TLT in both the short and longer-term measures. Not surprising, all four key U.S. equity markets also continued their relentless climb up, +.5% (on average) shrugging off what would normally be considered lousy news. A failed summit with North Koreans and the Cohen spectacle on the Hill was

Equities Rise While Risk Gauges Retreat

Keith Schneider | February 24, 2019

All four key US Equity markets continued their relentless climb up, +.72 % (on average) over the shortened week., However, there were some noteworthy changes in leadership. The most obvious one is that US global leadership is waning as the baton passed to Emerging markets, China and Hong Kong. In fact, our quant based model Alpha Rotation, (one of five we have created), just scaled out of some of its long positions in US stocks

Where the Rubber Meets the Road

Keith Schneider | February 18, 2019

The nation averted another shutdown at the expense of Trump declaring a national emergency. Equities loved it, led by the Grandpa Russell (IWM) which was up +4.23% on the week. ( Grandma Retail (XRT) shrugged off a terrible December, as sales were down-1.2%. This number has not been that bad in almost 10 years, which translates into no more rate hikes this year. US bonds seem to be tracing out a classic bottoming formation which

Risk On takes a Trip South

Keith Schneider | February 9, 2019

This week’s market action was relatively muted and mostly boring. We did get some entertaining headlines like Pelosi’s famous clap down and Bezos’ war with the National Enquirer that tanked both his marriage and his stock. U.S. Equity markets shrugged off sloppy, choppy sideways action with what appeared to be a mini buying panic in the last few minutes of the trading week. The key stocks indexes (QQQ, SPY, IWM) ended up +.3% on average.

A TIPSY Market

Keith Schneider | February 3, 2019

US Equity markets embraced a newly dovish Fed by tacking on a +1.5% weekly gain. US treasuries decided that it’s inflationary and backed off. Inflation adjusted bonds (TIPS) did well, attacking its 50-week moving average. Meanwhile, other inflation plays such as gold miners (GDX), Oil (USO) Brazil (EWZ) all out performed key benchmark stock indexes this week. On another note, Trump’s pressure on NATO members to pay their fair share of expenses is working as