Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The “Ultimate Market Timing Model” is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
As expected, the Federal Reserve left interest rates unchanged. The Fed Chair acknowledged a high degree of uncertainty about the effects of tariffs: “Ultimately the cost of the tariff has to be paid, and some of it will fall on the end consumer. We know that’s coming, and we just want to see a little...
Mid-week market update: As expected, the Fed stayed on hold today and took a wait-and-see attitude on the timing of rate cuts. While economic data has softened recently, as evidenced by the decline in the U.S. Economic Surprise Index, the Fed is still waiting for clarity on the effects of tariffs on inflation to make monetary...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The “Ultimate Market Timing Model” is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
In the wake of the tame May CPI report, the Trump Administration publicly pressured the Fed to cut rates on social media. CNBC reported that Trump called Powell a “numbskull” and he “may have to force something” if Powell doesn’t act. To access this post, you must purchase Monthly subscription.
Mid-week market update: One of the running themes of the TV show, the X-Files, is a poster on the wall of FBI agent Mulder with the caption “I want to believe”. As the S&P 500 breaks out at the 6000 resistance level and Street strategists scramble to their index targets, I also want...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The “Ultimate Market Timing Model” is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
I have been fairly cautious in my U.S. equity outlook in these pages, but that doesn’t mean I am equity bearish. The accompanying chart shows the progress of different major regional stock markets priced in USD in the last 20 years. With the exception of China, whose stock market doesn’t reflect its economy, stock prices...
Mid-week market update: The S&P 500 has been a little stronger than I expected as it tests upside resistance. I would urge traders to exercise caution as the market is exhibiting negative RSI divergences. Even though these kinds of divergences can persist for a while, they nevertheless indicate limited upside potential. A valuation...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The “Ultimate Market Timing Model” is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
TACO stands for “Trump Always Chickens Out” in trade negotiations. Financial Times journalist Robert Armstrong coined the term “TACO trade” as a colourful way of characterizing the Trump Put. When questioned by a reporter, Trump turned livid when he learned what TACO stood for. It is in that context when, later in the day,...
Mid-week market update: On the weekend, I presented this inverted chart of the S&P 500 as a different perspective and rhetorically asked, “Would you buy a stock with this chart?” At the time, I had a slight bearish tilt on the market. Since then, the news backdrop has been calming. Trump extended the...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
I am reiterating my bullish view on gold. Gold staged an upside breakout through a cup-and-handle pattern at 2100 in early 2024 and hasn’t looked back since. Moreover, it has staged upside relative breakouts against both the S&P 500 and a 60/40 proxy and it has stayed above the relative breakout levels even after the...
Mid-week market update: The S&P 500 were consolidating its gains after the upside price gap in reaction to the Sino-American interim trade agreement. You can tell a lot about the psychology of a market by the way it reacts to gaps. So far, the gap hasn't been filled - and some gaps are never filled,...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
Treasury Secretary Scott Bessent didn’t return from Switzerland and proclaim “Trade peace in our time” while waving a piece of paper. Instead, the interim deal represented a signal toward a trade détente and the acknowledgement that China is an equal in global trade with the U.S. The agreement. lowered the U.S. tariff on Chinese...
Mid-week market update: The market's turnaround on Monday was remarkable. Going into Friday, expectations for the Geneva trade talks weren't high. Trump had floated a reduction in the tariff rate to 80%. Instead, the U.S. cut the rate to 30%, and China cut its rate to 10%. With recession tail-risk fading, it's not a surprise...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
Treasury Secretary Scott Bessent has warned that the economy may need to undergo a detox period before it returns to more stable growth. Since that warning, stock prices sharply pulled back and the VIX Index spiked to above 60, which are levels not seen since the 2024 bottom, the COVID Crash and the GFC. Related...
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