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Weekly S&P500 ChartStorm: Risk Driver Review; Check On Tech; Hidden Bear Market

Published 04/18/2022, 12:49 AM
Updated 07/09/2023, 06:31 AM

This week: risk-driver review, check on tech, retail investor sentiment, the hidden bear market, utility of utilities, agribusiness on the moove, muddy macro, asset valuations..

Welcome to the Weekly S&P500 #ChartStorm. The Chart Storm is a selection of 10 macro/market charts which I hand pick from around the web and post on Twitter (NYSE:TWTR).

The charts focus on the S&P 500 (US equities); and the various forces and factors that influence the outlook—with the aim of bringing insight and perspective.

1. Correction-Drivers Update:

  • iShares MSCI Poland ETF (NYSE:EPOL) (geopolitics proxy): at a stalemate for now
  • iShares iBoxx $ Investment Grade Corporate Bond ETF (NYSE:LQD) (credit/rates): new lows as bond yields spike further
  • ARK Innovation ETF (NYSE:ARKK) [New Tech Fund] (tech burst): drifting further lower

Market itself just resting at support (and below both the 50 & 200dma).


Source: @Callum_Thomas

2. Amazon vs Commodities… Cycle has shifted: Amazon (NASDAQ:AMZN) vs GSCI—unfriendly regime for tech.

Amazon vs Commodities Chart

Source: @exposurerisk

3. The rise and rise of tech... Permanently higher plateau?

Tech Vs S&P 500 Price Relative

Source: @Marlin_Capital

4. Retail Investor Sentiment: Decent correction in sentiment as measured by this indicator, but it’s still quite far from the bottom end of the range.

IMX vs S&P 500 Chart

Source: TD Ameritrade Investor Movement Index

5. The hidden bear market... The headline index itself has not been much to get excited about either way, but under the surface there is a tell-tale sign of weakness and basically for all intents and purposes a hidden bear market.

Consecutive Weeks Of New Highs And Lows

Source: @WillieDelwiche

6. Utilities: Turns out Utilities... have utility in a down market.

(and extra informative that they are outperforming while bond yields are surging)


Source: @honeystocks1

7. Agribusiness on the moove: The VanEck Agribusiness ETF (NYSE:MOO) breaking out vs the S&P500 after an extended period of chewing its cud, so to say.

Agribusiness ETF Vs S&P 500 Chart

Source: @AdaptivCharts

8. Supply/Cost Problems: The supposedly transitory problems of supply chain disruption/shortages/COVID/rising costs is still to this day very clearly a major problem for business, based on what companies are saying during their earnings calls.

Supply/Cost Problems

Source: FactSet via @PriapusIQ

9. Economic Forecaster: The famous and clever Economist, Dr S&P500, is forecasting a slump in the ISM manufacturing PMI.

ISM Manufacturing PMI Vs S&P 500 YoY%

Source: @t1alpha

10. Asset Valuations: Commodities the least dirty shirt?

Asset Valuation vs History

Source: @topdowncharts from The 12 Charts to Watch in 2022 [Q2 Update]


Cyclicals vs Defensives: US cyclicals vs defensives have pushed deeper into new lows. Similarly, the gradual decline for EAFE has accelerated, and EM appear to have put in a lower high. All-up, around the world, cyclicals vs defensives have gone from a source of strength to a source of weakness.

Cyclicals Vs Defensives Chart

And when you zoom out at the global level it looks very clear: this is not a bullish chart. At best maybe markets go sideways, but this is not a situation where the macro/value backdrop is at best (expensive valuations, high inflation, stumbling growth, tightening monetary policy).

Global Cyclicals Vs Defensives Chart

We’ve just been through a period of historical excess, and as the tides come in, so do they go out. Sorry if this is too bearish for you, but I just look at the charts and say what I see. When they facts change, my opinion will change.

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