The Economic Data calendar for the week of the 20th of May through the 24th is full of critical releases and events. Attached below is a snapshot of some (though far from all) of the headline numbers that we will be focused on.
Takeaway: Keith bought shares of Archer Daniels Midland (ADM) this morning, then sold for a profit this afternoon.
Keith bought shares of Archer Daniels Midland (ADM) at 10:00am ET at $34.18 a share, and sold them at 3:33pm at $34.98 for a tidy 2.34% profit in a little more than five-and-a-half hours.
Keith writes of his purchase this morning: “(Consumer Staples sector head) Rob Campagnino reiterating his bullish view on ADM post the Berkshire sale. Higher-lows and bullish trend (are) intact into a big corn crop utilization.”
Warren Buffett’s Berkshire Hathaway disclosed in a filing this week that it had sold its entire stake in ADM, in which Berkshire had amassed holdings of nearly six million shares.
Keith writes of his sale of ADM this afternoon, “How’s that for some weekend moneys? ADM moved to immediate-term TRADE overbought within its bullish TREND, in a day!”
Regional gaming is primarily slots and slot players are dwindling
It’s no secret that we like #StrongDollar. Historically, strong dollar periods have been characterized by lower commodity inflation, low energy prices, rising confidence and strong consumption growth.
The Dollar is a causal factor in our model and our StrongDollar call over the last 5 months has backstopped our expectation for Gold and Commodity deflation and rising consumption as purchasing power benefits and discretionary share of wallet gets a boost.
Year-to-date, we’ve seen the $USD march interminably higher alongside declining federal profligacy, improving domestic macro data, increasingly marginalized Fed policy, slower EM growth, emergent European dovishness and explicit Yen debauchery. We expect the dollar to continue to benefit from a further perpetuation of these dynamics.
Currently, the $USD remains in Bullish formation (Bullish TRADE/TREND/TAIL) and U.S. dollar correlations to the SPX (+) and Oil, Gold & Commodities (-) remain strong across durations.
Now, we’re beginning to see confidence chase the dollar higher as consumer confidence measures begin a nascent break out of their 4 year slumber. This morning’s University of Michigan Consumer confidence reading accelerated to 83.7 in May from April’s final reading of 76.4, posting it’s highest reading since July 2010.
The acceleration in the Univ. of Michigan confidence reading agrees with recent breakout to new 5Y highs observed in the Bloomberg Consumer Comfort Index and the steady advance in the Conference Board’s measure of consumer confidence.
Longer-term, outside of the last four years in which confidence readings essentially flat-lined, consumer confidence has been highly correlated with accelerating economic activity. A sustained breakout in confidence alongside ongoing housing and labor market improvement represents a fertile factor cocktail capable of catalyzing positive economic reflexivity.
#StrongDollar = Strong America.
Enjoy the weekend,
Christian B. Drake
This indispensable trading tool is based on a risk management signaling process Hedgeye CEO Keith McCullough developed during his years as a hedge fund manager and continues to refine. Nearly every trading day, you’ll receive Keith’s latest signals - buy, sell, short or cover.