The “Trump Trade” is Still in the Market

The “Trump Trade” is Still in the Market

The “Trump Trade” is Still in the Market

$DIA, $SPY, $QQQ, $VXX

It has been difficult for analysts to differentiate “Trump Rally Trades” from those stemming from reflation, and solid global economic indicators that suggest some basis for bond yields and stock values above the lows of Y 2016.

The USD, sometimes a bellwether for US economic confidence, has declined almost 2% in March and is close to erasing a more than 6% rally since President Trump’s election on 8 November.

The Dollar Spot Index, a gauge of the American currency against a basket of global peers, is down 4.9% since peaking at a record on 3 January

The benchmark S&P 500 is nearing its average price for the year, when measured using mean prices paid. Falling below that mark may suggest a fall into losing territory.

Investors are raising short positions on the US benchmark, in anticipation of further losses. Short interest as a percentage of shares outstanding in the SPDR S&P 500 ETF (SPY) has more than 2X’d this month, to 2.5%, according to data compiled by Markit.

The Chicago Board Options Exchange Volatility Index (VIX) spiked 15% last week, the biggest such gainer on the year.

In Europe, the VStoxx Index rallied 11% Monday to the highest level in a month. Even so, overall levels for the VIX remain relatively low compared with the spikes seen last year.

And while the yield on 10-yr US Treasuries has dipped since touching 2.63% earlier this month, levels remain in the elevated range seen since the November US Presidential election.

  • May WTI Crude Oil ended -0.6% to $47.72 bbl
  • April Nat Gas ended -1% to $3.05 MMBtu
  • May Silver ended +2% at $18.10 oz,
  • April Gold ended +0.6% at $1255.60 oz

Monday, the US major stock market indexes finished at: DJIA-45.74 at 20551.05, NAS Comp +11.64 at 5840.38, S&P 500-2.39 at 2341.57

Volume: Trade on the NYSE came in at 990-M/shares excahnged

  • NAS Comp +8.5% YTD
  • S&P 500 +4.6% YTD
  • DJIA +4.0% YTD
  • Russell 2000 unch YTD
HeffX-LTN Analysis for DIA: Overall Short Intermediate Long
Neutral (-0.01) Bearish (-0.43) Neutral (-0.11) Very Bullish (0.50)
HeffX-LTN Analysis for SPY: Overall Short Intermediate Long
Neutral (0.06) Bearish (-0.30) Neutral (-0.08) Very Bullish (0.56)
HeffX-LTN Analysis for QQQ: Overall Short Intermediate Long
Bullish (0.31) Neutral (0.11) Bullish (0.31) Very Bullish (0.50)
HeffX-LTN Analysis for VXX: Overall Short Intermediate Long
Neutral (-0.23) Neutral (-0.21) Neutral (-0.20) Bearish (-0.29)

Stay tuned…

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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