Trying to hear what's not being said
January 23, 2025 Leave a comment
Here at the moments when Germany’s #DAX Index has registered a monthly overbought reading.
While there is more behind my analysis, this simple study suggests that those who allocate capital into #German equities might be dummkopf or perhaps foolish, if they haven’t got one foot out of the door.
January 23, 2025
rob@karriasset.com.au
November 5, 2024 Leave a comment
This study overlays Bitcoin volatility against the S&P 500 Index.
It is saying to me that when Bitcoin volatility is overbought, buy equities
And when #Bitcoin #Volatility (BVOL) is registering an RSI reading below 38, then it seems that equities are stifled, perhaps signalling a peak.
BVOL traded below 38 last week.
November 5, 2024
by Rob Zdravevski
Karri Asset Advisors
rob@karriasset.com.au
September 2, 2024 Leave a comment
When the CAD/CHF is declining, ‘they’ are selling the Loonie and huddling into the safety of the Swissie.
This happens when ‘we’ don’t fancy a risky environment. That also means risker assets such as equities are also being aggressively disposed.
While not to be used in isolation, the study below shows 16 moments (over the past 40 years) when the CAD/CHF registered a Monthly RSI reading of less than 33.
When it does, perhaps ponder increasing your asset allocation towards equities.
The nuance is which equities (market) to buy.
Currently, it’s close but not there yet.
And remember, currencies don’t lie or tell stories.
September 2, 2024
by Rob Zdravevski
rob@karriasset.com.au
August 12, 2024 Leave a comment
Last week’s palaver about unwinding Yen trades is old news.
The Yen has nearly swung to the other side of the pendulum.
The study below shows the 13 moments over the past 15 years when the AUD/JPY was trading (coinciding with a couple other metrics) at a weekly RSI reading of 36 or below.
I say ‘nearly swung’, for we are close but not there yet……for another such occurrence.
When they do occur, they bode well for listed equities risk appetite.
The Nasdaq 100 index appears within my study as a comparison.
August 12, 2024
by Rob Zdravevski
rob@karriasset.com.au
August 12, 2024 Leave a comment
To support a case for a tactical bounce in the equity markets,
I have used red to highlight the data when the AAII investor sentiment survey has had the narrowest spread between bullish and bearish respondents,
And I have circled those corresponding moment in the accompanying S&P 500 chart.
So that all looks lovely when many of the bulls disappear.
Although, ‘bounces’, by nature are short-term.
For the strategic equity allocators, this note supported the ‘grind’ higher for the S&P 500
But that was back then and we are now deeper into this grind.
My final line in that note said, “It’s not the safest of markets”.
August 12, 2024
by Rob Zdravevski
rob@karriasset.com.au
May 31, 2024 Leave a comment
Shares in #Accenture have just registered their 5th moment of being ‘oversold’ (on a weekly basis) in the past 20 years.
#ACN
May 31, 2024
May 5, 2024 Leave a comment
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.
Extremes “above” the Mean (at least 2.5 standard deviations)
Australian 2, 3, 5 & 10 year government bond yields *
Japanese 2 year government bond yield
South Korean 10 year government bond yield *
Copper/Gold Ratio
U.S. 5 year government bond yield minus U.S. 5 year inflation breakeven rate *
Newcastle Coal
Oats
AUD/IDR *
AUD/THB *
Hang Seng China Enterprises Index (HSCEI) *
Hang Seng Index *
J’burg 40
Singapore Straits Times Index *
Overbought (RSI > 70)
Russian 10 year government bond yield
AEX
Budapest
Malaysia’s KLSE *
Pakistan’s KSE Index *
FTSE 250
and Turkiye’s BIST 100 *
The Overbought Quinella (Both Overbought and Traded at > 2.5 standard deviations above the weekly mean)
Brazilian 10 year government bond yields
Copper
Extremes “below” the Mean (at least 2.5 standard deviations)
SHY
PHP/USD *
Dow Jones Transports *
And Indonesia’s IDX30 *
Oversold (RSI < 30)
Lithium Hydroxide
North European Hot Rolled Coil Steel
The Oversold Quinella (Both Oversold and Traded at < 2.5 standard deviations below the weekly mean)
Lumber
Urea
Notes & Ideas:
Government bond yields fell.
Many streaks were broken such as the 5 week winning streak in Canadian and South Korean 10’s along with all the yields across the British curve.
Chinese 10 year bond yields is no longer oversold as its yield rose.
Equities were mostly higher.
However, selected European bourses did see weakness.
China’s A50 Index and the U.S. KBW Bank Index have risen 7.5% and 5.2% respectively, over the past 3 weeks.
IBEX, MIB, & Stockholm’s OSX 30 aren’t overbought anymore.
The HSCEI and Hang Seng both rose 4.5% for the week, adding to last week’s 9% advance.
Furthermore, the Hang Seng and U.S. (KRE) Regional Banks Index are in a 3 week winning streak.
The SOX finished flat following last week’s stunning 10% rise.
Karachi broke its 6 week winning streak.
The Nasdaq Transports has declined for 5 consecutive weeks.
And Toronto’s TSX registered a bearish outside reversal week.
Commodities were mostly lower, again.
Weakness was seen in Cocoa, Coffee, Precious Metals, Oils and Distillates.
Strength was evident in Base Metals, Coal, Gases and Grains.
Some of the grains have strung 3 weeks of consecutive gains.
Aluminium, Tin & Nickel are not overbought anymore, nor is Cocoa, Coffee or Gold (in any currency).
Cocoa has fallen 31% in the past fortnight and has broken its overbought streak of 27 weeks.
While Australian Coking Coal isn’t oversold this week.
Robusta Coffee has fell 15% accounting for nearly half of the 39% rise seen in the prior 9 weeks.
Cotton has fallen for 8 consecutive weeks while Rubber has sunk for 6 weeks straight.
Iron Ore in a 5 week winning streak.
U.S. Hot Rolled Coil Steel performed a bearish weekly outside reversal.
And Lithium Hydroxide has now spent 42 consecutive weeks in weekly oversold territory.
Currencies are providing stealth guidance for the health of various asset trends.
The big news was the strength in the Japanese Yen and it’s no longer at last weeks extremes.
The AUD rose against all except the Yen.
The Canadian Loonie fell while the Euro was mixed.
The British Pound fell with the exception of the USD pair.
The Thai Baht broke its 7 week losing streak against the USD.
And the USD/SEK registered a outside weekly bearish week.
The larger advancers over the past week comprised of;
Australian Coking Coal 3.2%, Baltic Dry Index 9%, China Coking Coal 4.7%, Tin 2%, Newcastle Coal 5.8%, Natural Gas 11.4%, Platinum 4.7%, Dutch TTF Gas 5.5%, Uranium 5.5%, Corn 2.3%, Oats 7.9%, Soybeans 3.2%, China A50 2%, HSCEI 4.4%, Hang Seng 4.7%, Russell 2000 1.8%, KRE Regional Bank Index 3%, FTSE 250 1.7%, Nasdaq Biotechs 5.9%, Chile 2.6% and the BIST 100 rose 3.6%.
For reference, the S&P 500 rose 0.6% for the week.
The group of largest decliners from the week included;
Aluminium (1.9%), Cocoa (23.1%), WTI Crude (6.9%), Cotton (3.5%), Lean Hogs (2%), Heating Oil (4.7%), Coffee (Arabica) (10.4%), Lumber (2.7%), Lithium (5.7%), Gasoline (6.9%), Coffee (Robusta) (14.7%), SPGSCI (3.8%), CRB Index (3.5%), Brent Crude Oil (6%), Gasoil (5.3%), Urea Middle East (2.1%), Silver in AUD (3.6%), Silver in USD (2.4%), Gold in AUD (2.7%), Gold in CHF (2.6%), Gold in EUR (2.2%), Gold in GBP (2%), Gold in ZAR (3%), CAC (1.6%), MIB (1.8%) and Spain’s IBEX fell 2.7%.
May 5, 2024
by Rob Zdravevski
rob@karriasset.com.au
May 3, 2024 Leave a comment
In the short-term, I think the rally in Chinese equity indices is one to ‘rent’, rather than ‘own’.
And I see particular nuances across the 15% – 20% advance seen in the CSI 300 and the #China A50 to the 30% rise in the HSCEI.
It’s been a constructive effort building a new base, however the current trends are not (yet) all exhibiting strength.
I’m anticipating a near-term moment to scalp some returns. Later, I expect an opportunity to accumulate at lower levels.
In this week’s edition of Macro Extremes, the HSCEI will appear in an Overbought ‘extreme’ category.
Inversely, the study below shows the moments when the CSI 300 (in Macro Extremes) was Oversold.
May 3, 2024
by Rob Zdravevski
rob@karriasset.com.au
April 26, 2024 Leave a comment
Its the 4th time in 10 years that the Australian Dollar #AUD has traded a) at a certain percentage above my long term moving average while b) simultaneously registering an overbought weekly reading and also c) trading at stretched standard deviations above its rolling weekly mean……against the Japanese #JPY Yen.
#AUDJPY
I like watching this currency pair as an indicator of risk appetite.
April 26, 2024
by Rob Zdravevski
rob@karriasset.com.au
March 20, 2024 Leave a comment
For the 8th time in the past 12 years, #Germany‘s DAX Index is registering a weekly overbought reading.
While there is more behind my analysis, this simple study shows that probabilities of a further advance change at this juncture.
Following such an occurrence, we mostly see the #DAX trade sideways, if not lower, for up to 24 months hence.
It’s not a time to chase.
That country #allocation trade began about 20 months in mid-2022.
50% ago.
This note listed that observation.
While the DAX is currently within its 7th consecutive week of higher prices and myopically, it looks like having a little more upside, the ‘fat part of the trade’ has been seen.
March 20, 2024
by Rob Zdravevski
Karri Asset Advisors
rob@karriasset.com.au
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