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Major Trend Index

Aug 14 2019

MTI: Momentum Smacked Again

  • Aug 14, 2019

The hits to the Momentum category were broad-based; the Advance/Decline work continues to disguise a very dangerous, underlying bifurcation of the market.

Aug 07 2019

MTI Stable, But Still Negative

  • Aug 7, 2019

Read this weeek's Major Trend.

Aug 06 2019

MTI: Momentum Takes A Hit

  • Aug 6, 2019

The Momentum category lost ground in the latest calculation, with more than three-quarters of the loss reflecting a flip in one of our “long-term” momentum sub-models from 50% bullish in the prior week, to maximum bearish at Friday’s close.

Jul 30 2019

MTI: Economic Factors Lifted By Monetary Measures

  • Jul 30, 2019

Growth in M1 and M2 money supply has picked up, offsetting the bearish readings for Adjusted Reserves and the Fed balance sheet. Momentum category also strengthened.

Jul 23 2019

MTI: Momentum Improved Despite Modest Market Losses

  • Jul 23, 2019

The Momentum category improved despite last week’s modest market losses, with some of the longer-term trend work improving. Daily and weekly 52-week lows for the NASDAQ remain elevated, reflecting the increasing concentration of strength in Technology stocks.

Jul 16 2019

MTI: Upside Surprises/Depressed Expectations

  • Jul 16, 2019

We think that the economic surprises, as well as the yield uptick, reflect an unwind of extremely one-sided positioning rather than an indication of a second-half economic rebound.

Jul 09 2019

MTI: Attitudinal Measures Erode On Investor Enthusiasm

  • Jul 9, 2019

The Momentum category continues to grind higher, but this push has predictably stirred up investor enthusiasm (as measured this week by an identical decline in our Attitudinal composite). At the same time, longer-term measures like CEO Confidence, Small Business Optimism, and Consumer Confidence have all weakened in the latest reports, suggesting a rollover in animal spirits could be underway.

Jul 04 2019

MTI Still Negative; Stay Defensive

  • Jul 4, 2019

Read this week's Major Trend.

Jul 03 2019

MTI: NOPE Index Boosts Economic Category

  • Jul 3, 2019

The bounce in the Economic category interrupted its last few months’ steady grind lower; the increase was led mostly by an upgrade to the NOPE Index (ISM New Orders Minus Price Index), which moved from high neutral to moderately bullish. The action of individual components is hardly reassuring, however.

Jun 25 2019

MTI: Economic Work Continues To Erode

  • Jun 25, 2019

The Economic work continues to erode, and it would now be deeply negative if not for the conventional scoring of our leading inflation measures, in which disinflation is viewed as a good thing. But if our suspicions that this economic cycle will end in a deflationary bust are correct, the conventional interpretation will be wrong.

Jun 18 2019

MTI: Consumer Confidence Worrisome “Inversion”

  • Jun 18, 2019

A less-publicized, but still worrisome “inversion” occurring beyond the Treasury market is that of Consumer Confidence, in which the Conference Board’s Present Situation Index has soared almost 70 points above the Expectations Index. This gap always becomes extreme in the late stages of an economic expansion, and today’s reading surpasses those recorded at all business cycle peaks other than February 2001.

Jun 11 2019

MTI: Economic Measures Continue To Lose Ground

  • Jun 11, 2019

We view market and economic risks as high, but the Momentum picture has been convincing enough to prevent us from adopting a maximally defensive posture.

Jun 07 2019

MTI Back Into Negative Territory

  • Jun 7, 2019

Read this week's Major Trend.

Jun 04 2019

MTI Back In Negative Territory

  • Jun 4, 2019

We don’t like “news-driven” market moves, and it’s pretty obvious that May’s decline was due in large part to the ramp-up in the trade war. That said, trends in the economy and earnings were already weakening prior to the latest escalation.

May 29 2019

MTI: Economic/Momentum Continue To Lose Steam

  • May 29, 2019

Aside from the decidedly bearish action in the Treasury yield curve, U.S. and global money supply growth rates remain sluggish; both the Fed balance sheet and the Adjusted Monetary Base are still in outright decline.

May 21 2019

MTI: Economic Measures Remain Weak

  • May 21, 2019

Weakness in several coincident economic measures suggest that global-policy tightening over the last 18 months is having an impact. The current Fed policy stance doesn’t lead us to believe much improvement is likely in the near term.

May 14 2019

MTI: Momentum Pulls Back

  • May 14, 2019

The Momentum work has been the largest week-to-week MTI swing factor for many months, and that was the case again last week. The Attitudinal category improved, reflecting increasing investor anxiety.

May 07 2019

MTI: Edging Higher Within Neutral Band

  • May 7, 2019

Read this week's Major Trend.

Apr 30 2019

MTI: Stock Leadership Similar To Late 1990s’

  • Apr 30, 2019

We are not in the “melt-up” camp but we’re impressed by the close similarities in leadership with the greatest late-cycle melt-up of all time, which took place from late 1998 through March 2000.

Apr 23 2019

Price Action Strong Despite Earnings/Liquidity Trends

  • Apr 23, 2019

Although we are not in the “melt-up” camp, we’d concede that stock market leadership is exactly what we’d expect if we were in that camp: Domestic over Foreign, Large over Small, and Growth over Value. Price action continues to remind us of the powerful rebound off the fall 1998 lows. Current earnings and liquidity trends, however, are not nearly as supportive as they were during that historic market move.

Apr 16 2019

MTI: Dead Neutral

  • Apr 16, 2019

The Boom/Bust Indicator, a weekly ratio of industrial-commodity prices to initial unemployment claims, has had a near-vertical rebound to old highs in the last several weeks. This index usually peaks out many months in advance of a business cycle peak (although not in 2007, when it provided no warning of the pain to come).

Apr 09 2019

MTI: Momentum Keeps Gaining

  • Apr 9, 2019

If the market’s manic rebound succeeds in assuaging consumers’ recently shaken confidence, we can certainly see a scenario in which the economy and corporate profits firm up after their current slowdown… although that is not our bet.

Apr 05 2019

MTI: Firmly Neutral

  • Apr 5, 2019

Read this week's Major Trend.

Apr 02 2019

MTI: Valuation Factors Still A Drag, But Well Below Extremes

  • Apr 2, 2019

The Intrinsic Value category remains a drag on the MTI but is well below cycle extremes seen in January 2018 and again in September. The Momentum category, however, continues to nudge the MTI higher for the third consecutive week.

Mar 26 2019

MTI Remains Low-Neutral

  • Mar 26, 2019

One of our long-term momentum models improved last week, while the Dow Bond Oscillator—as good of a mechanical monetary indicator as we’ve encountered—pushed further into positive territory.

Mar 19 2019

Economic Work Lifts MTI Into Neutral Zone

  • Mar 19, 2019

Within the Economic work, the big development was a bullish flip in our Dow Bond Oscillator (DBO), which crossed above the zero threshold by the thinnest of margins. Subjectively, however, we are troubled that government yields across the maturity spectrum have been holding near recent lows in the face of equities’ powerful rally.

Mar 12 2019

MTI: Valuations Ignoring Indications Of An Earnings Recession

  • Mar 12, 2019

Valuations seem to ignore indications that an earnings recession has begun, let alone the possibility that S&P 500 GAAP Earnings Per Share for 2018 could represent not just a short-term peak, but perhaps a cyclical peak as well.

Mar 07 2019

MTI: Almost Neutral, But Not Quite

  • Mar 7, 2019

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Mar 05 2019

Momentum Factors Reflect Breadth Of 10-Week Rally

  • Mar 5, 2019

All of the domestic and global quantitative Chart Scores in the Momentum category are now positive and both the Advance/Decline and High/Low figures leave no doubt as to the breadth behind the market’s 10-week rally.

 

Feb 26 2019

MTI: Still Negative, But Gap Narrows

  • Feb 26, 2019

The MTI’s stubbornness during the current rally confirms our overall sense that cyclical risks facing U.S. equities remain high. That said, we have great respect for the action of the market itself—enough so that we’ve allowed net equity exposure in our tactical funds to drift upward.

Feb 20 2019

MTI: Momentum Strengthens

  • Feb 20, 2019

Momentum category gain was driven by strength in breadth measures, selected trend models, and most of the Chart Scores.

Feb 12 2019

MTI: Attitudinal Measures Net Negative

  • Feb 12, 2019

The Attitudinal category, which tends to vary inversely with the Momentum work, turned negative for the first time since mid-October, suggesting growing investor conviction that the rally will continue.

Feb 07 2019

MTI: Still Short Of Neutral

  • Feb 7, 2019

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Feb 05 2019

MTI: Big Boost In Momentum Measures

  • Feb 5, 2019

From a Momentum perspective, chart work has improved across the board but much of the longer-term trend work has remained in neutral or bear territory. These measures are, by definition, late at turning points, and we strongly prefer that the “anticipatory” tools within the MTI drive most of the swings.

Jan 29 2019

MTI: Investor Expectations Are Subdued

  • Jan 29, 2019

The Attitudinal category remains solidly bullish, suggesting there are significant investor doubts surrounding the rally. The market has also absorbed the past few days’ earnings torpedoes fairly well, another sign that expectations are still subdued.

Jan 23 2019

MTI: Economic Numbers Continue To Weaken

  • Jan 23, 2019

While growth rates in M1, M2, and MZM appear to have leveled off following their sharp declines over the prior 18 months, the annual rate of decline in the Adjusted Monetary Base (a good proxy for the Fed’s balance sheet) accelerated to almost 12% at year-end from just 3% six months earlier.

Jan 15 2019

MTI: Bear Market Rally In Progress

  • Jan 15, 2019

The move off the late-December lows has been broad and powerful but not at all unusual for a countertrend move in a bear market. Since 1945, bear market rallies in the S&P 500 have lasted an average of six weeks and carried the index higher by an average of 10.8%.

Jan 08 2019

MTI: Up A Bit, But Still Negative

  • Jan 8, 2019

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Jan 03 2019

MTI: Attitudinal Factors Best Since 2016

  • Jan 3, 2019

The Attitudinal category’s net reading is the best (i.e., most pessimistic) since the week following the February 2016 correction low. While that’s an encouraging sign, there’s no mechanical threshold on this composite which would indicate a “safe” re-entry point.

Dec 26 2018

MTI: Intrinsic Value Readings Jump

  • Dec 26, 2018

The lack of more meaningful MTI improvement in response to this month’s collapse suggests the bear has yet to fully express himself. But the swipes he’s taken so far have hit hard: Last week saw a nearly 150-point gain in the Intrinsic Value composite to its best level since April 2016.