Thursday, February 4, 2016

The Recession Rotation Before the Shitting of Bricks

The recession trade is on in full force. Momentum gets sold and defensive stocks get bought. Short covering across the entire industrial sector.

Short covering also ahead of tomorrow's jobs report. 

We've seen this movie before, but we're pretending we don't know the ending...

All world index

With KMB:SPX ratio
(Kimberly Clark/S&P)

Canadian stocks:

Equal weight / cap weight ratio:
When this rolls over, everything falls as one...

One of these didn't get the memo...
Yen (red) with S&P

Next up: Hammer Time
Google is down -10% since becoming world's most valuable company for a day. Check out the rising wedge on the Wilshire (black) - it reminds me of August...but I'm pretending not to notice...

The entire momentum sector has rolled over. When that wedge breaks, shit gets real...