Emotions aside we think that trading macro market trends is rather simple, but only if you keep it simple! And that is what we attempt to do each day, identify primary trends (and by default capital flows) by analysing just a few key indices within each asset class. On a daily basis we believe that [...]
Posts from ‘August, 2009’
Inflation Premiums Are Rising Indicating Higher Commodity Prices in the Making
Is the inflation trade really in trouble? Apart from looking just at the performance of commodity prices themselves what other tools do we have at our dispersal that would indicate inflationary or deflationary conditions? There are a number but we will discuss one of our favourites now. We look at the performance of inflation protected [...]
Six of the World’s Dumbest Trade Ideas
This morning when I went for my daily jog I thought to myself, how about trying to go out and intentionally lose money! Yes it always appears (and is) so difficult to make money by trading in financial markets. But hang on, wait a minute, if it is so hard to make money then [...]
Small Cap Banking Stocks Close to a Bullish Breakout
Just how strong is the rally in banking stocks? Yes on the surface it appears that banking stocks are making a comeback with clear technical breakouts despite the barrage of negative news that persists over bad loans and potential bad loans……….however just what is the depth of the rally in banking stocks? To gain an [...]
High Yield Thunderbirds are Go
The “yield/risk” seeking theme that has gripped world financial markets since mid March (perhaps since mid October) is alive and kicking. To get an indication of market sentiment we look at the relative behaviour of high risk and low risk securities of each asset class. Specifically this entails studying the relationships of the following:
Equities – [...]
Intermarket Analysis Supports Higher Commodity Prices
Inter-market analysis suggests that the market continues to factor in higher inflation as an investment “theme” going forward. We look at the behaviour of the bond and equity markets (albeit relationships within) as confirming indicators for both our fundamental and technical outlooks for commodities. It appears that inflation protected treasuries continue to outperform non inflation [...]
The Cost of the Financial Bailout $3,300 For Each Citizen of the Planet
The IMF recently calculated that the cost of rescuing the financial system has come to approximately $12-trillion which is equivalent to about 20% of the of the world’s economic output or from a slightly different perspective equivalent to a USD3,300 payout for every man woman and child on the planet! Of course as with physics [...]
Commodities Fast Becoming the World’s Preferred Currency
Many have cited a weak USD as the primary cause of strong commodity prices as of late, however, on closer inspection it appears that commodity prices are rising even in non USD terms. This suggests either rising global inflation, global industrial production, or some combination of the two. Frankly we are not so concerned with [...]
China a Storm in a Tea Cup for Now
Our attention has been drawn to the weakness displayed by the Shanghai Composite over the last few weeks. Of course the big question is whether or not this is just a correction of a short term overbought condition or the beginning of something far more serious. Judging from experience bear markets don’t just begin in [...]
If It Isn’t Broke Look Harder
When I first started trading some 20 years ago I was very lucky to be taken under the wing of a trader that had traded global markets for over 30 years. He always taught me that if it all looks so good in the major market indices then look harder at the detail, specifically the [...]
