• 1 hour Russian Prestige And American Politics: The COVID Vaccine Race
  • 3 hours Is The Silver Rally Over Or Just Getting Started?
  • 1 day Alibaba-Backed Tesla Competitor Set To IPO In The U.S.
  • 1 day Emerging Economies Could Get Left Behind In Race For COVID Vaccine
  • 2 days Dead Malls Could Be Amazon’s Next Target
  • 2 days Unpacking Biden's Energy Plan
  • 2 days Russia Aims To Become World's Top Gold Producer
  • 3 days Global Tech Stocks On Edge Over Trump TikTok Ban
  • 3 days Cobalt Squeeze Threatens The Electric Vehicle Boom
  • 4 days COVID Has Sparked A Surge In Cybercrime
  • 4 days Precious Metals Bulls Still Have Plenty Of Room To Run
  • 5 days The U.S. Has The Tech To Go Green, But Will It Use It?
  • 5 days Massive Losses Force Russian Commodities Giant To Slash Dividends
  • 6 days Markets Up On Stimulus Hope
  • 6 days UK To Invest In Europe's First Geothermal Lithium Recovery Plant
  • 7 days TikTok Takes Center Stage In US-China Tech War
  • 7 days Are Semiconductor Stocks Overvalued?
  • 8 days Jobs Report Doesn’t Say Much Amid COVID Uncertainty
  • 8 days Crypto FOMO Heats Up As Bitcoin Climbs Above $11,000
  • 9 days Aluminum Is Bouncing Back In China
How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

  1. Home
  2. Markets
  3. Other

Hedgers Net Short The Euro, US Market Rotates

In line with our bullish forward view on USD, behold the very bearish state of the Commercial Hedger positions in the Euro (courtesy of Sentimentrader). Recent historical data speaks for itself. It appears a decline in the Euro is imminent (which, in market terms means ‘relax, it could be a while yet’ ).

(Click to enlarge)

The next question is, when Uncle Buck rides will he ride alone or will he have the other rider at his side? The 2 Horsemen would be the bringers of pain in the form of liquidity removal from a range of markets (the gold/silver ratio indicates anti-inflation and market stress).

(Click to enlarge)

Currently, markets are on a speculative frenzy and indeed, I’ve been participating (with ongoing risk management in the form of profit taking, loss limitation, rotation and CASH). Speaking of rotation, the latest rotation has been into Healthcare, which NFTRH tracked every step of the way using our ‘vs. SPY’ charts and some good old fashioned fundamental discussion relating to interest rates and my personal experience as a former supplier to medical device companies.

Here is the daily ‘vs. SPY’ chart from NFTRH’s Market Internals segment showing Healthcare (XLV, 3rd panel) becoming relatively overbought with momos finally catching on (as they always do, eventually).

(Click to enlarge)

And a weekly view of the nominal Healthcare sector. We were well prepared for the eventual breakout in XLV, have been bullish on the Medical Device sector (IHI) all along, but especially since the election due to a now-favorable political backdrop (and a likely removal of Obamacare’s funding taxation that burdened the sector) and most recently, Biotech (our target on IBB is 350).

(Click to enlarge)

But this is not a promo post for NFTRH’s sector-picking prowess, is it? Well, maybe; but it is more a post about the 2 Horsemen and what the implications would be if the Euro fades as expected and Uncle Buck rides with the Gold/Silver ratio later this summer. The US stock market has been rotating for weeks now… FANG → Financials → Industrials → Healthcare → ?

The fun and games, in the form of sector rotation and rolling momentum, would be terminated for as long as the Horsemen would ride. In other words, at some point a correction is going to come about that will not spare any/many sectors.

By Gary Tanashian for Safehaven.com

Back to homepage

Leave a comment

Leave a comment