Weekly Macro Analysis
02.03.2024
My Risk Signals have pivoted out of Risk Off:
Lumber to Gold: No Signal
IEF/TLT: Switched to Risk On, ever so slightly
XLU/SPY: Risk On still
SPY: Another week, another ATH for SPY
Volume and Breadth this week:
Breadth and New Highs have been picking up meaningfully this week. I can not say anything bearish about it, so I won´t.
eTorians sold the NQ and Gold advance in a big way. I cannot remember them being as low as 50% Long on Gold.
This is how it looked in sector terms:
Strongest: Tech, Discretionary, Real Estate
Weakest: Comm Services, Healthcare, Utilities
Chart of the week: GOLD on the verge of THE Break Out?
Conclusion:
We are in a raging Bull market. Insane how we shrug off bad news and rally on good news.
Looking at the sector performance, we had a big shift back into Risk On, with Utilities showing massive relative underperformance.
Then not to forget the massive BTC Rally in the beginning of the week.
Despite all of that, the Large Speculators have actually decreased their Long positions as price went up, here for example the NQ:
This could mean to me that we still have room to run in this market. We are far from the exuberance we saw in 2021.
Everyone is doubting this rally, and especially the smart Macro investors have been sceptical of this bull market. Usually a bull market does not top on scepticism, but it grows on it.
As the legendary Hedge Fund Managaer John Templeton said: bull markets are born on pessimism, grow on scepticism, mature on optimism and die on euphoria.
We do see some wild speculation in a few Semis, but the majority of people are still not that bullish in my opinion.