Weekly Macro Analysis 18.05.24
Mental Metal Rally
We saw massive changes in the markets behaviour after the CPI came out in line with expectations on wednesday.
Most important change was the Sell off in the USD:
This led to a Rally in basically everything. If you wonder why, I recommend my Big Picture Macro Post:
What I found interesting that this time the Rally was being led by the “secondary” Assets: Silver and Solana instead of Gold and BTC.
For me, a new kind of market has begun, which might mean that we will move away from the narrow Big Tech leadership and broaden out into Materials, Emerging Markets and maybe even Meme stocks?
HSI (China):
Silver:
Copper:
Meme Stocks:
A word of caution, Meme stocks are a sign of complacency in the markets and too much liquidity.
This might in the short term be bullish for stocks, but in the medium term it is a bubble ready to burst.
While one should be cautios to buy meme stocks, it is even worse to sell them, many “smart” investors who thought it was stupid that meme stocks rallied that hard, despite being actually bad companies so naturally they got short.
And they got punished for it by the markets.
If we see strong moves in the market that apparently make no sense, or are even “irrational” we should rather rush to buy them instead of shorting them.