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POSITIONS: Long Utilities (XLU), Short Industrials (XLI)

I think it’s safe to say that consensus now agrees with Hedgeye on Growth Slowing. Now we have to deal with cleaning up their mess. Alongside immediate-term capitulation, we’re finally seeing a Short Covering Opportunity.

Across our core risk management durations, here are the lines that matter to me most: 

  1. Intermediate-term TREND resistance = 1369
  2. Immediate-term TRADE resistance = 1315
  3. Long-term TAIL support = 1283 

In other words, we’re right there – right on the TAIL line. And I am making my call to start covering your shorts. Our gross long exposure to this market remains very low.

KM

Keith R. McCullough
Chief Executive Officer

Short Covering Opportunity: SP500 Levels, Refreshed - SPX