jay_S_

jay_S_

The TIP / IEF ratio (reflecting relative strength of Treasury Inflation-Protected securities against T Bonds), having broken thru a declining long-term trend early in 2021, has now advanced to record an 8 year high. The Fed inflation narrative does not appear to be satisfying bond market participants.

jay_S_

The Canadian $ (plotted here against USD) is approaching key levels and represents one of several signs emphasizing the continuing rise of oil and natural resources. Inflation remains a hot topic & this is one aspect to keep an eye on.

jay_S_ Updated 

Commodities have continued a steady climb, and the CRB Index is outperforming SPY (as noted in an earlier post). But CRB is now hitting the upper edge of a resistance band with longer-term market cycle implications. A close watch is required here to see how the CRB Index performs at this crucial juncture.

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The Discretionary vs Staples ratio (captured via the $XLY and $XLP etf's) serves as one of many proxies for a potential "Risk Off" signal. While it had been "Risk On" for a number of months, the evidence is mounting that the trend has reversed and market participants are now moving towards more defense and less offense. Be cautious of a sudden and crowded rush...

jay_S_ Updated 

The long-term stock market trend unquestionably continues to be an upward one. However, there are seasonal and other factors (such as market breadth, etc) that may be pointing towards a potential pause or reversal. Since no single indicator is fool-proof, a "weight of the evidence" approach is always warranted. Such an approach ideally includes a variety of...

jay_S_

S&P500 ($SPY) has continued to print new all-time highs throughout this year, albeit lately on continually narrowing breadth. Potentially lost in the fray is the fact that real estate has actually been outperforming SPY throughout 2021 (as have commodities). This graph shows the relative strength of $IYR, an ETF representing the Real Estate sector via RE...

jay_S_ Updated 

SPY spent the month of March fighting back, on a relative basis, against commodities. April, however, has seen commodities regain the upper hand and resume its relative strength against the major US equity benchmark. If a commodities "super cycle" is in the works, this will be a great chart to watch with further repercussion for EEM and other material/commodity...

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We have all heard that trees cannot grow straight to the sky, but $GOOGL sure does not seem to know or respect that. Simply an amazing display of consistent growth as seen on this historical monthly stock chart. Stock remains near its all-time high.

jay_S_

Junk bond spreads have been at historic lows, representing no stress evident in the credit markets. But lately, the $JNK : $TLT relationship is turning. Could this be a hint from the credit markets that we are moving towards a risk off (or reduced risk) environment? Watch the chart and accompanying RSI against key levels as a clue.

jay_S_ Updated 

Relative weakness in growth stocks has been popping up in several places lately. Here we see the Relative Strength of Silver versus IWF (Russell 1000 Growth) has been heading up over the last month or so, potentially indicating a rough patch ahead for the prior high flying growth sector.

jay_S_

$BRK.B built a three-year base and, over the last several months, has really rallied to hit all-time highs. Keep in mind this stock is a significant component and influence on the Financials sector and its ETFs.

jay_S_

Update: The Copper / Gold ratio is now hitting levels not seen in 3 years. Pushing thru this level would be a major confirmation for base metals and commodities in general.

jay_S_

Keep an eye on the relative strength of TIPS vs IEF as a measure of inflation expectations. Watching both real and nominal interest rates can be helpful in assessing future prospects for commodities and other real assets.

jay_S_

Gold is beginning to show some signs of life. But, interestingly, Copper relative to Gold is finally resolving higher, with a new 52 week hi this past week. Speaks to robust demand for copper, but investors must stay alert for other clues on commodities, yields and inflation.