Macro Roundup Wednesday 18 August 2021

In the last update, we saw Stocks maintaining their “Mind the Squeeze” regime and they have continued to do just that. However in the last several sessions, we have seen, first, a switch into “Buy the Dip” and then just yesterday into the “Amber Alert” a.k.a “Mind the Flop”. The implication here is to protect longs…

In Bonds, the early-August drop saw a switch from “Mind the Flop” into “Sell the Bounce” and then as the bounce developed a move back into the original “Mind the Flop”. Hence I am on high alert for a potential resumption of the early-August drop…playing through low-risk option structures.

Energy has been consistent in the “Sell the Bounce” regime from near the recent high. Refer to the last Energy update for how I am playing this…

Metals have been fairly consistent in the “Mind the Squeeze” regime for a couple of months. Apart from my ultra-long-term holdings in precious metals, I am looking at Copper finding support anywhere from here to say 6/7% lower before resuming the uptrend.

Summary: Long stocks, protected and looking to add to opportunities at good support levels (eg EWY mentioned in the last report)…short bonds through options for a resumption of early-August weakness…watching Crude for entry into longs…watching Copper for entry into longs

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Kudakwashe Chinhara

Kudakwashe Chinhara

Statistician, Cycle Analyst, Chartered Market Technician