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    MARKET EDGES

    Identify global risks and opportunities with essential macro intel using Hedgeye’s Market Edges.

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

You’re not going to get the prices you sold into in early April 2012 (at least not yet), but you’re going to get the next best thing – lower long-term highs.

Fundamentally, it’s actually easier to make the sell call now than it was then. Back then at least #GrowthSlowing wasn’t as broad based (ask MCD, PCLN, or RL about that today). Back then, revenues/earnings on the company side were a lot better too.

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

  1. Immediate-term TRADE resistance = 1408
  2. Intermediate-term TREND support = 1381 

In other words, provided that 1381 holds – everything US Equities is fine, until it isn’t. In the meantime, I think we make lower highs as growth continues to surprise on the downside.

The volume signals I am registering are the most bearish I have ever measured in my career.

KM

Keith R. McCullough
Chief Executive Officer

Lower-Highs: SP500 Levels, Refreshed - 1