The value of stock market indices is highly correlated with the amount of existing money. That is why to measure the economic cycles, I weight the value of the stock market with that of the money supply (M2), obtaining this chart. We see how after 2008, business cycles of about 4 years have been established and that, in addition, we are now in an already mature...
ISM Services PMI Rep: 53.4% ✅ HIGHER THAN EXPECTED ✅ Exp: 51.7% Prev: 50.5% (revised down marginally from 50.6%) The reading for ISM Services PMI came in much higher than expected with services remaining in expansionary territory for Jan 2024 (>50 Level) Whilst ISM Manufacturing PMI came in at 49.1 on the 1st Feb (<50 level) and in contractionary territory,...
To Recap: In parts one and two we used MACD monthly perspective momentum across a large number of tradable assets to produce a matrix of tradable assets, and then to distill an overview of each category's momentum state. The raw data is placed in the quadrant most consistent with the combination of the MACD momentum state and its price trend. The raw data...
In the first three installments we described an exercise utilizing the long term momentum in asset classes, the relationship between those classes and the Organization for Economic Co-operation and Development (OECD) Composite Leading Indicator (CLI) for the United States, in order to anticipate the business cycle and markets. Those posts are linked below. Since...
Last year I produced several posts that described an exercise that utilizes long term momentum changes between asset classes and the relationship among asset classes to anticipate the business cycle. That series and parts 1 and 2 of this series are linked below. Parts one and two of the series described the general methodology, presented the matrix with the raw...
Last year I produced several posts that described an exercise that utilizes long term momentum changes between asset classes and the relationship among asset classes to anticipate the business cycle. That series and part 1 of this series are linked below. Methodology: Individual markets and ratios are plotted in the quadrant that best describes their...
Last year I produced several posts that described a methodology utilizing long term momentum changes between asset classes and the relationship among asset classes to help anticipate the business cycle. That series is linked below. When I worked in the institutional setting I would place hundreds of assets, ratios, spreads of individual corporate bonds and...
NASDAQ:AEIS was one of the darlings of the '90s. So much fun to swing trade this stock. It is now moving up to test the all-time highs of 2021. Electronic Components are cyclical stocks typically with huge revenues ahead of holidays, school openings and summertime. The cycle is starting again. Notice that Volume Oscillators and Money Flow indicators are rising...
Inflation has been rising aggressively since 2021. It accelerated from 2% to hit an all-time high of 9.1% in June 2022. As inflation rose, central banks like the Fed raised interest rates to control inflation . But this effort to control inflation, on one hand made money more expensive for the industries and on the other hand pushed consumers to reduce their...
In parts 1 and 2 we discussed using a market momentum matrix to anticipate the business cycle and how the MACD oscillator is used to build the matrix. In part 3 we will illustrate the logic of placing individual auctions into their quadrants, and illustrate the distillation process. As a reminder Individual markets and ratios are plotted in the quadrant (quad)...
In part one, we discussed using a market momentum matrix to anticipate the business cycle, the potential inflection in the macro environment and shared the final distillation of the current momentum matrix. In part 2 we discuss how the MACD oscillator is used to build the matrix. Methodology: Individual markets and ratios are plotted in the quadrant that best...
Visualizing Business and Market Cycles Through Market Momentum: Part 1 Effect of liquidity: Change in regime: It is often said that markets are discounting mechanisms, anticipating changes in the business cycle. I believe that it is generally true, and while it has been less true for most of the last two decades, that it is about to become true again. It is my...
Market sell off in small cap stocks. Small cap stocks are usually the first to sell off and the last to rally bad times for the markets ahead?
Hello, traders! ETH price has significantly corrected after going into a trend. The business cycle is nearing its end, which is confirmed by the weakness of the instrument. The price is under MA100 and MA200 on the daily timeframe. Also, the RSI indicator value is constantly decreasing and gradually approaching the oversold level. The range of $1050 - $1440...
So we have synchronized movements between long-term treasury yields (5, 10 and 30 years) and cyclicals (airlines, oil companies, carmakers, cruise lines, etc.) regardless of the fundamentals. If these yields are expected to continue increasing in response to a higher rate of inflation, a continuation of the trend in cyclicals would also be expected. The peak of...
Just a theory. Not sure what will happen. It will either correct very slowly over a course of several years or a sudden drop to 1700 like what happened in early 2020.
BIDU has been in a bear business cycle since early 2018. This downtrend remains intact as the slope of the highs remains downward. High Frequency Traders gapped the stock down recently.
Here is a few ideas in one chart, a parabolic curve that is inside the channel bitcoin has been following year after year. Looking at the 4 year halving(halvening) cycle leading to a parabolic run up in price. On this chart we see both previous cycles from previous halving events overlayed to give a few ideas what could happen if history were to rhym...