Hi, as the weather after a short trip to the tropics is now back where it was most of the time this spring, there's this time again a somewhat more detailed comment. ;)
Unfortunately, to a time when the situation is somewhat unclear. Just last week I saw on the fundamental side almost only negative messages, while increased Courses and optimism. The best way to see it in comparison to the S & P ECRI Weekly Index (a composite of several published weekly economic data, see also the comment from last week and http://www.businesscycle.com/ ). Conclusion: weak macro data, rising prices
this were the only weekly data is a negative factor Macro.
was significantly negative as well as the ZEW (light green). From the market usually less attention, he is a good precursor to the IFO. (IFO business climate is composite, even for short IFO index include: red; expectations component: dark green)
Similar situation in the U.S., where the Philly Fed gave an important economic sentiment indicator clear
addition, there were very weak data from the U.S. real estate market (housing starts + permits and the NAHB Home Builder Sentiment Index, a good precursor for the New Home Sales). Since I already regularly read about the U.S. real estate market, I'll let the charts but this time out. Are enough other factors. About the Baltic Dry Index, which just experienced a sharp decline (Chart by bloomberg.com):
Even the copper chart, another good economic indicator appears after the break of the upward trend to establish a downward trend:
related copper (12-month change) to ISM:
Each of these indicators, no doubt, ever delivered a false signal, but recently took the signs of a noticeable slowdown significantly. are signs of renewed recession but there is currently no. However, we are also just beginning the financial crisis, which is also visible in only a few macro data.
So why has the market despite the bad news situation then turned up?
I see mainly due to the extremely bearish positioning of many market participants who wanted to keep their shorts or could not, than the S & P 500 by more smoothly introduced the times starting in 1040 do not look down and broke through their positions at the latest after the break the 200-day line. At best, the leaves on the correlation of the MSCI World to HFRX Marco read index (day 2 days late published performance index of macro hedge funds, including systematic trend followers):
Such an extremely bearish position has in recent years often results in at least short-term rally out. Interesting about the situation during the Lehman bankruptcy in September 2008, when the market was massively short (or perhaps better said, the "shaking hands" by André Kostolany, the whole market can always be positioned just neutral). At that time turned out to be the stock market at first surprisingly robust. Only weeks later, when the macro fund their positions were shot mostly, came the crash.
sees Currently, it now looks like this: After 10 days in a row (as many as in the past only in März09), performed in which the macro fund each just the opposite as the MSCI World, they rise on Thursday (the last available day) for the first time, together with the shares. Thus, the short positions appear to be largely resolved.
So, how's it going next? Just as in März09, that we are at the beginning of a new rally? It seems right now to my chart many analysts, such as on-godmode trader.de . Or is it more comparable to September08, when the Macro Fund threw in the towel too early?
can, in principle, the development of the past week, both interpreted as bullish and bearish:
Bullish: If the market in spite of bad news. A very positive sign.
Bearish: Relatively small counter-movement has been sufficient to wash out the short position in the market while tilting the sentiment. (Chart below. Difference between "bulls" and "bear" in the AAII weekly poll among private investors, the mood is bullish again as massive as relatively rarely before in recent years, the AAII index is a classic counter-indicator..) A renewed building speculative short positions is the market among major brands charttechnsich press and could cause a crash.
A similar question appears in the EUR / USD. The euro was down this week, despite recent downgrade Greece and spread widening in most PI (I) GS-countries (with the exception of Italy, which can decouple lately). This is bullish for the euro.
show the same time, the weekly CFTC data (blue line) that non-commercials (ie, mainly hedge funds) on Tuesday their huge short positions in comparison to last week almost halved (-44%) have. The following days they should have reduced if prices rise further positions. Here, too, so had a huge reduction in the negative market positioning only a relatively small price movement (relative to the previous crash) result. I see more bearish.
So in sum I can give you no clear opinion. I think the next few weeks will be crucial. If the market after the end of the mini short squeeze (which the movement, not what the position change is more "mini") was still strength to continue to rise significantly, or soon will be a renewed wave of selling in the market break the neck?
We shall see.
And so until the next rainy Weekend. ;)
Greetings
Franz
PS As a large Wolkenkratzerfan (see my comment from 11.4
http://franzlischka.blogspot.com/2010/04/mein-ublicher-senf-zur-aktuellen_10.html ). It is of course not escaped me that Vienna also gets a new oversized phallic symbol:
http://www.wienweb.at/pstorystart.aspx?menu=1&cid=172086
with 220m altitude in Western Europe at this time in the top 10 and with a completion date in 2012 on a time line with the building boom in London and the new New York's World Trade Center. With the Millennium Tower in Vienna in 2000 we have ever had a recession properly-timed, if one looks at the international construction boom, chances are good that it once again succeed. ;)
