Macro Extremes (week ending August 1st, 2025)

A weekly Macro, Cross Asset review of prices trading at extremes which may generate future investment ideas and opportunities.

The following assets (on a weekly timeframe) either registered an Overbought or Oversold reading and/or have traded more than 2.5 standard deviations above or below its rolling mean.

n.b. pricing of (commodity) futures contracts is only considering the immediate front month.

* denotes multiple week inclusion

Extremes above the Mean (at least 2.5 standard deviations)

USD/INR

CSI 300 * 

Shanghai Composite Index *

Overbought (RSI > 70) 

Cattle *

Urea (U.S. gulf prices) *

Urea (Middle East) prices *

Hungary’s BUX Index *

Pakistan’s KSE Index *

South Korea’s KOSPI *

Czechia’s PX Index

Tel Aviv 35 equity index *

Canada’s TSX *

Vietnam’s VN Index *

And Polands WIG equity index *

The Overbought Quinella (Both Overbought and Traded at > 2.5 standard deviations above the weekly mean)

Spanish 10 year bond yields 

Extremes below the Mean (at least 2.5 standard deviations)

None

Oversold (RSI < 30)

Lithium Carbonate *

Lithium Hydroxide *

Robusta Coffee *

The Oversold Quinella (Both Oversold and Traded at < 2.5 standard deviations below the weekly mean)

North European Hot Rolled Coil Steel *

Notes & Ideas:

Government bond yields mostly fell.

Australian yields are close to mean reverting.

The U.S. yields re already doing so and look like going lower.

U.K. yields are looking to do the same.

Indonesian 10 yer yield rose and broke a 5 week losing streak.

Indian 10’s have climbed for 4 weeks.

Russian 10 year bonds yield has fallen for 11 straight weeks.

The U.S. 30 year – 10 year bond yield spread is approaching overbought territory,

And the U.S. 5 year ‘real interest rate’ is the most oversold since July 2022.

Equities were weaker.

Many winning streaks were broken and some indices departed overbought territory.

The South Africa 40 and Singapore’s Strait Time were amongst the latter.

U.S. small and mid caps, banks along with the transports were amongst the notable losers 

Copenhagen’s main index suffered due to the downdraft in main weight, Novo Nordisk.

Hungary’s BUX fell and broke its 4 week winning streak.

Czechia’s main indices have risen for 5 weeks straight.

While Stockholm, Johannesburg, London, CSI 300 and the Shanghai Composite fell and saw their winning streak end at 5 weeks.

Karachi and Bangkok are in 6 week winning streaks.

Vietnam’s VN Index broke its 6 weeks of consecutive advance..

Oslo has fallen for 4 straight weeks.

While the Sensex and Nifty has fallen for 5 consecutive weeks.

Commodities were mainly lower.

Crude Oil, Lumber, Gold and LNG were the notable gainers.

Aluminium, Shipping Rates, Copper, Platinum, Diesel, Tin, Lithium and Grains dominated the losers category.

Copper, Orange Juice & Palladium drop out of overbought territory. 

Copper’s slump and Gold rise led to a large decline in the Copper/Gold Ratio.

U.S. Hot Rolled Coil Steel has risen for 4 weeks.

Cattle prices are in a 6 week winning streak.

Urea’s U.S. Gulf price has climbed for 8 straight weeks.

Inversely, Oats have fallen for the past 4 weeks.

JKM LNG rose and broke 5 straight weeks of decline

Base and Industrial metals look like going lower,

And Sugar is nearly oversold.

Currencies were active.

All currencies appearing in last week’s list of extremes have departed the scene.

The Aussie fell and the AUD/CHF is approaching oversold.

The Loonie was mixed.

The U.S. (DXY) Dollar rose 1% and has risen 2% overall since its recent oversold reading.

The Euro was weaker. 

GBP/EUR rose and broke a 4 week losing streak.

Overall, the Yen rose to match the risk-off mood.

Furthermore, the JPY/EUR rose and ended a 9 consecutive weeks of decline.

The Philippine Peso has fallen ro 4 weeks against the USD.

The U.S. Dollar is in a 5 week rising streak versus the Indian Rupee.

A prospective Long in the USD/BRL is attracting my attention,

In fact, many new U.S. Dollars long pair trades are shoring up.

The larger advancers over the past week comprised of;

Brent Crude Oil 3.1%, WTI Crude Oil 3.3%, Lumber 3.2%, LNG in Yen 6.8%, Gasoline 2.7%, Robusta Coffee 3.2%, Dutch TTF Gas 2.9%, Gold in AUD 2.3%, Gold in CHF 1.9%, Gold in EUR 2.1%, Gold in GBP 2%, Gold in ZAR 2.4%, ASX Financials 1.5% and ASX Industrials rose 1.3%.

The group of largest decliners from the week included;

Australian Coking Coal (2.1%), Aluminium (4.6%), Bloomberg Commodity Index (1.6%), Baltic Dry Index (10.6%), Cotton (2.7%), Copper (23%), Heating Oil (3.3%), Arabica Coffee (4.5%), Lithium Hydroxide (3%), Lithium Hydroxide (6.3%), Tin (5.9%), Natural Gas (3.3%), Nickel (2.3%), Orange Juice (27.1%), Palladium (2.9%), Platinum (7.4%), Iron Ore CFR China (2,7%), CRB Index (2.3%), Gasoil (4.7%), Silver in AUD (1.5%), Silver in USD (3%), Corn (2.5%), Oats (2.7%), Rice (2.9%), Soybean (3.1%), Wheat (4%), CSI 300 (1.8%), All World Developed ex USA (2.9%), AEX (2.3%), ATX (2.6%), KBW Banks (4.4%), CAC (3.7%), China A50 (2.3%), DAX (3.3%), DJ Industrials (3%), DJ Transports (7.7%), FCATC (2.8%), MIB (1.9%), HSCEI (3.8%), Hang Seng (3.5%), IBB biotechs (1.8%), S&P small caps 600 (3.9%), Russell 2000 (4.2%), Nasdaq Composite (2.2%), KRE Regional Banks (5%), KOSPI (2.4%), FTSE 250 (1.9%), S&P Midcaps 400 (3.5%), NBI biotechs (1.5%), Nasdaq 100 (2.2%), Nikkei 225 (1.6%), Copenhagen (8.6%), Helsinki (3%), Stockholm (2.8%), PSE (1.7%), SOX (2.1%), S&P 500 (2.4%), STI (2.5%), Nasdaq Transports (4.9%), TSX (1.7%), Vietnam (2.4%), WIG (2.6%), XBI biotech (1.9%) and the ASX Materials Index fell 3.9%.

August 3, 2025

By Rob Zdravevski

rob@karriasset.com.au

Copper’s parabola mean reverts, quickly

In last weeks edition of my weekend Macro Extremes publication, the price of Copper appeared in the overbought quinella section.

But that won’t be the case his week.

The price of #Copper fell 23% this past week and it mean reverted.

Readers of my work will relate my warnings about mean reversion. This time, it happened very quickly.

But it’s not being ‘short’ Copper.

It was more about not chasing and buying at extreme levels, irrespective of the ‘narratives’.

p.s. this word “narrative” is doing much damage……

August 2, 2025

rob@karriasset.com.au

A rare 9 week winning streak for Microsoft

Just for sport……#Microsoft shares are currently in a 9 week winning streak.

I don’t think I’ve seen such a streak in that stock for over 20 years…..

While short-term stuff isn’t my style, if there is a bet to make….

I’ll say, with 2 days left in the trading week and #MSFT reporting earnings tomorrow………..Microsoft’s stock will break its 9 week streaks of consecutive advance, at the end of this week.

July 30, 2025

Macro Extremes (week ending July 25, 2025)

A weekly Macro, Cross Asset review of prices trading at extremes which may generate future investment ideas and opportunities.

The following assets (on a weekly timeframe) either registered an Overbought or Oversold reading and/or have traded more than 2.5 standard deviations above or below its rolling mean.

n.b. pricing of (commodity) futures contracts is only considering the immediate front month.

* denotes multiple week inclusion

Extremes above the Mean (at least 2.5 standard deviations)

Orange Juice 

Palladium  *

Shanghai Rebar Steel

CSI 300

ASX Materials Index

Overbought (RSI > 70) 

Cattle *

Urea (U.S. gulf prices) *

Urea (Middle East) prices *

CHF/JPY

Hungary’s BUX Index *

Pakistan’s KSE Index *

South Korea’s KOSPI *

Czechia’s PX Index

South Africa 40 equity index * 

Singapore’s Strait Times *

Tel Aviv 35 equity index *

Canada’s TSX *

Vietnam’s VN Index *

And Polands WIG equity index *

The Overbought Quinella (Both Overbought and Traded at > 2.5 standard deviations above the weekly mean)

Copper

Shanghai Composite Index

Extremes below the Mean (at least 2.5 standard deviations)

None

Oversold (RSI < 30)

North European Hot Rolled Coil Steel *

Lithium Carbonate *

Lithium Hydroxide *

Robusta Coffee *

CAD/CHF

CAD/EUR

JPY/CHF

USD/CHF

JPY/EUR

The Oversold Quinella (Both Oversold and Traded at < 2.5 standard deviations below the weekly mean)

None

Notes & Ideas:

Government bond yields were mixed, again.

Australian, Spanish, Japanese, Swedish and shorter dated American yield rose,

The rest fell.

Canadian 10 year bond yields fell and broke their 4 straight weeks of advance.

Indonesian 10 year yields have fallen for 5 weeks.

Russian 10 year bonds yield has fallen for 10 straight weeks.

And the U.S. 10 year breakeven inflation rate is nearly overbought. 

Equities were subdued and mostly stayed in a tight range.

The overbought brigade extend their stay for another week.

U.S. biotech and Transports has a good week as did the Nikkei 225.

The ASX Financials Index was the largest loser.

Hungary and Czechia’s main indices have risen for 4 weeks straight.

The Shanghai Composite and the CSI 400 have risen for 5 consecutive weeks.

Karachi, Stockholm, Johannesburg, Bangkok and London are also in 5 week winning streaks.

Vietnam’s VN Index has climbed for the past 6 weeks.

While the Sensex has fallen for 4 consecutive weeks.

And the Philadelphia SOX index fell and broke its 8 week winning streak. 

Commodities were mixed, again, again.

Coal, Shipping Rates, Cocoa, Copper and Lean Hogs were the notable gainers.

Oil, Distillates and Gases, Palladium, Platinum, Sugar and Corn dominated the losers category.

Platinum drops out of overbought territory.

Gold price were softer.

Cocoa and Rice both rise and left oversold land.

The latter broke a 5 week falling streak.

Cattle has risen for 5 weeks.

Copper and Rubber are in 6 week winning streaks.

Urea has climbed for 7 consecutive weeks.

Robusta Coffee fell and gave up all of last weeks 4% gain.

JKM LNG has slumped for 5 straight weeks,

And Australian Coking Coal rallied following my observations in last weeks edition.

Currencies were active.

We saw several currency Pais re-enter extreme territory this week.

The Aussie rose, reversing last weeks weakness.

The Loonie was weaker.

The CHF/JPY is in a 9 week winning streak.

Overall, the U.S. (DXY) Dollar was weaker.

The Euro saw strength.

So much so, the EUR/USD is an inch from being overbought. 

While the EUR/GBP and the EUR/JPY are in respective 4 and 9 week winning streaks.

The Pound Sterling was weaker,

And the Yen was mixed.

The larger advancers over the past week comprised of;

Australia Coking Coal 10.3$, Richards Bay Coal 1.9%, Aluminium 1.7%, Rotterdam Coal 2.1%, Baltic Dry Index 10%, Cocoa 6.8%, Lean Hogs 2.1%, Copper 3.2%, Lithium Hydroxide 1.8%, Tin 5.2%, Newcastle Coal 2.8%, Tin 1.8%, Rice 2%, Shanghai Composite 1.7%, CSI 300 1.7%, All Word Developed ex USA 1.8%, ATX 2%, KBW Banks 1.6%, IDX 3.2%, DJ Transports 3.2%, FCATC 3.3%, HSCEI 1.8%, HSI 2.3%, IBB biotechs 4.5%, IBEX 1.8%, S&P SmallCap 600 0.9%, Russell 2000 0.9%, S&P MidCap 400 1.4%, Mexico 1.9%, NBI biotechs 3.6%, Nikkei 4.1%, Copenhagen 3.2%, Helsinki 2.2%, Stockholm 2.3%, PSE 1.7%, S&P 500 1.5%, STI 1.7%, Nasdaq transports 4.3%, Vietnam 2.3%, XBI biotechs 1.6%, BIST 2.7% and the ASX Materials rose 2%.

The group of largest decliners from the week included;

Bloomberg Commodity Index (1.6%), WTI Crude Oil (1.4%), Heating Oil (2%), Arabica Coffee (2%), LNG in yen (5.5%), Natural Gas (12.8%), Palladium (3.7%), Platinum (2.3%), Gasoline (2.4%), Robusta Coffee (3.6%), Sugar (3.2%), Dutch TTF Gas (3.3%), Gasoil (1.5%), Corn (2.2%), Wheat (1.5%), KRE Regional banks (2.1%), SOX (1.5%), ASX 200 (1%) and the ASX Financials fee 3.9%.

July 27, 2025

By Rob Zdravevski

rob@karriasset.com.au

Streaks and troughs for the SOX

The Philly SOX Index has risen for 8 straight weeks.

Just a note to say, 8 weeks is rare streak.

It doesn’t mean it falls from here, but probability implies it takes a breather for a week or three.

The circles in the chart below are the main focus…..for next time.

That’s when the SOX appeared as an oversold quinella in the April 4th, 2025 edition of Macro Extremes publication.

Macro Extremes (week ending April 4, 2025)

It has seen a 54% advance since then.

Those April 4th and April 11th editions of Macro Extremes contained the broadest smorgasbord of oversold extremes I had seen in years.

July 24, 2025

rob@karriasset.com.au

Equity bull market remains intact

Bond Volatility is not telling me to sell equities.

July 24, 2025

Macro Extremes (week ending July 18, 2025)

A weekly Macro, Cross Asset review of prices trading at extremes which may generate future investment ideas and opportunities.

The following assets (on a weekly timeframe) either registered an Overbought or Oversold reading and/or have traded more than 2.5 standard deviations above or below its rolling mean.

n.b. pricing of (commodity) futures contracts is only considering the immediate front month.

* denotes multiple week inclusion

Extremes above the Mean (at least 2.5 standard deviations)

Baltic Dry Index

Heating Oil

Overbought (RSI > 70) 

Cattle *

Platinum *

Urea (U.S. gulf prices) *

CHF/JPY

Hungary’s BUX Index *

South Korea’s KOSPI *

Tel Aviv 35 equity index *

South Africa 40 equity index

Singapore’s Strait Times

Canada’s TSX

And Polands WIG equity index

The Overbought Quinella (Both Overbought and Traded at > 2.5 standard deviations above the weekly mean)

Palladium *

Urea (Middle East) prices *

Pakistan’s KSE Index *

Vietnam’s VN Index

Extremes below the Mean (at least 2.5 standard deviations)

Cocoa (London price)

Rice

JPY/CAD

Oversold (RSI < 30)

Lithium Carbonate *

Lithium Hydroxide *

Robusta Coffee *

The Oversold Quinella (Both Oversold and Traded at < 2.5 standard deviations below the weekly mean)

North European Hot Rolled Coil Steel *

Notes & Ideas:

Government bond yields were mixed.

Canadian 10 year bond yields have climbed for 4 straight weeks.

Indonesian 10 year yields have fallen for 4 weeks.

Russian 10 year bonds yield has fallen for 8 straight weeks.

The RSI of the U.S. 10 year breakeven inflation rate is approaching a reading of 60.

U.S. 30 year minus U.S. 10 year yield spread are nearly overbought,

And the U.S. 10 year divided by Aussie 10 year yield is entering a new downtrend.

Equities were subdued and mostly stayed in a tight range.

Several more indices joined the overbought brigade this week.

Chinese indices were stronger along with Australian and other Asian indices.

There are some streaks developing too.

The Shanghai Composite and the CSI 400 have risen for 4 consecutive weeks.

Karachi, Jakarta, Turkiye’s BIST, FTSE 100, Singapore’s STI, the ASX Materials, Toronto’s TSX and Thailand’s SET are in 4 week winning streaks.

The TSX has climbed for 12 of the past 15 weeks and advanced 18% over that time.

While the SET has soared 13% over the past 4 weeks.

Vietnam’s VN Index has climbed for the past 5 weeks.

Meanwhile, Israel’s TA35 fell and broke its 4 week rising streak.

And the Philadelphia SOX index is in a 8 week winning streak. 

Commodities were mixed, again, again.

Shipping Rates, Coffee, Natural Gas, Orange Juice, Rubber and Corn were the notable gainers.

Coal, Cocoa, LNG Gas and Rice dominated the losers category.

Richards Bay Coal gave up all of the previous weeks gains.

Palm Oil has risen 6% in the past fortnight, which is 10 times more than Gold’s performance.

The Baltic Dry Index is showing some life recently.

Cattle has risen for 4 straight weeks.

Rubber and Iron Ore are in 5 week winning streaks.

Urea has climbed for 6 consecutive weeks.

Platinum eased a little and thus broke its 6 week winning streak.

Orange Juice soared 42% over the past fortnight.

Australian Coking Coal looks like establishing a floor.

Arabica Coffee rose and broke its 5 week losing streak.

And Rice has fallen for 5 weeks.

Currencies were active.

Many currencies have left their extremes this week.

The Aussie fell.

Moreover, the AUD/JPY fell and broke a 4 week rising streak.

The Loonie rose and so the CAD/CHF broke its 5 weeks of declines.

The CHF/JPY and EUR/JPY are in 8 week winning streaks.

Broadly, the Yen was weaker.

The Euro rose against all except the USD.

The British Pound was mixed.

The larger advancers over the past week comprised of;

Baltic Dry Index 23.4%, Palm Oil 3%, Lean Hogs 1.7%, Arabica Coffee 6%, Lithium Carbonate 1.6%, Henry Hub Natural Gas 7.6%, Orange Juice 10.3%, Palladium 1.5%, Robusta Coffee 4.1%, Sugar #16 2.3%, Rubber 3.7%, Gasoil 2%, Corn 3.2%, Soybean 2.8%, Egypt 1.5%, IDX 3.7%, FCATC 4.6%, HSCEI 3.4%, Hang Seng 2.8%, TAEIX 2.8%, Nasdaq Composite 1.5%, KSE 3.2%, SA40 1.8%, SET 7.6%, STI 2.5%, Vietnam 2.7%, WIG 3.2%, ASX Financials 1.6%, ASX 200 2.1%, ASX Industrials 1.9% and the ASX Small Caps rose 3.2%.

The group of largest decliners from the week included;

Richards Bay Coal (2.7%), Rotterdam Coal (3.8%), Brent Crude (1.5%), Cocoa (4.6%), WTI Crude Oil (1.6%), JKM LNG (5.3%), LNG in Yen (1.8%), Tin (1.7%), Newcastle Coal (3.8%), Dutch TTF Gas (5.5%), Oats (1.5%), Rice (3.3%), DJ Transports (2.1%), BOVESPA (2.1%), PSE (2.4%) and the TA-35 fell 1.6%.

July 20, 2025

By Rob Zdravevski

rob@karriasset.com.au

Taking the markets temperature – July 2025 edition

My latest newsletter can be read here;

https://mailchi.mp/karriasset/taking-the-markets-temperature-july-2025

Full but odds of a melt-up are increasing

The Morgan Stanley Capital International All Country World Index is trading at levels which make me pay attention to an impending peak.

The MSCI ACWI is described as capturing large and mid cap representation across 23 Developed Markets (DM) and 24 Emerging Markets (EM) countries. With 2,528 constituents, the index covers approximately 85% of the global investable equity opportunity set.

Sadly, also according to its fact sheet, the index’s top 10 holding account for 23% of the total constituents weight.

However, the odds of a ‘melt-up’ is increasing.

Funnily, the term ‘melt-up’ is often used at the upper end of an existing advance, so I say, just be aware what time it is at the current party.

July 12, 2025

rob@karriasset.com.au