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3 Charts: Don't Buy Equity Market All-Time Highs

Takeaway: As consensus macro piles into the S&P 500, total equity market volume is crashing and the VIX hits a disquieting level.

3 Charts: Don't Buy Equity Market All-Time Highs - consensus cartoon 06.21.2016

 

Sell low, cover high, baby!

 

That's the latest expressed by consensus macro positioning as the S&P 500 hit a new all-time high last week.

 

"The S&P 500 (index + E-mini) net LONG position ramped another +94,526 contracts last week to +154,009 futures & options contracts. To put that in context, that’s a +2.37x move on a 1-year Z-score (at the lows in February, it was a net SHORT position of -280,000 contracts)," Hedgeye CEO Keith McCullough writes this morning.

 

3 Charts: Don't Buy Equity Market All-Time Highs - positioning

 

On a related note, a no confidence vote for the all-time high came by way of total equity market volume which crashed -23% versus its 1-year average on Friday:

 

3 Charts: Don't Buy Equity Market All-Time Highs - volume 7 25

 

Volatility?

 

The VIX is registering a foreboding level. As Hedgeye U.S. Macro analyst Christian Drake pointed out in Friday's Early Look:

 

"In the Chart of the Day below we simply show VIX vs S&P500 (S&P500 is inverted on right axis). What you’ll simply notice is how simply effective it is to take down gross exposure and tighten net exposure when VIX goes <13."

 

#Simple

 

3 Charts: Don't Buy Equity Market All-Time Highs - 7 22 16 CoD2

 

None of this bodes well for the bulls blindly buying the all-time high. 


Daily Market Data Dump: Monday

Takeaway: A closer look at global macro market developments.

Editor's Note: Below are complimentary charts highlighting global equity market developments, S&P 500 sector performance, volume on U.S. stock exchanges, rates and bond spreads, key currency crosses, and commodities. It's on the house. For more information on how Hedgeye can help you better understand the markets and economy (and stay ahead of consensus) check out our array of investing products

 

CLICK TO ENLARGE

 

Daily Market Data Dump: Monday - equity markets 7 25

 

Daily Market Data Dump: Monday - sector performance 7 25

 

Daily Market Data Dump: Monday - volume 7 25 16

 

Daily Market Data Dump: Monday - rates and spreads 7 25

 

Daily Market Data Dump: Monday - currencies 7 25

 

Daily Market Data Dump: Monday - commodities 7 25


CHART OF THE DAY: The Beta Chase Is On!

Editor's Note: Below is a brief excerpt and chart from today's Early Look written by Hedgeye CEO Keith McCullough. Click here to learn more.

 

"... Looking at last week’s futures & options (CFTC) positioning, the Beta Chase is not an exaggeration: 

  1. SP500 (Index + E-mini) net LONG position increased by +94,526 contracts to +154,099 contracts
  2. The 6-month and 1-year average net positions are net SHORT averages of -54,383 and -100,426 contracts
  3. The current net LONG position registers a z-score of +2.37x (that’s the biggest in all of Global Macro)"

 

CHART OF THE DAY: The Beta Chase Is On! - 07.25.16 chart


Early Look

daily macro intelligence

Relied upon by big institutional and individual investors across the world, this granular morning newsletter distills the latest and most vital market developments and insures that you are always in the know.

REPLAY! This Week On HedgeyeTV

Our deep bench of analysts take to HedgeyeTV every weekday to update subscribers on Hedgeye's high conviction stock ideas and evolving macro trends. Whether it's on The Macro ShowReal-Time Alerts Live or other exclusive live events, HedgeyeTV is always chock full of insight.

 

Below is a taste of the most recent week in HedgeyeTV. (Like what you see? Click here to subscribe for free to our YouTube channel.)

 

Enjoy!   

 

1. Why I Remain An Unrepentant Bear (7/23/2016)

 

 

This is an excerpt from a special presentation Mike O’Rourke, Chief Market Strategist at Jones Trading gave to Hedgeye’s 2016 summer intern class. In this clip, O’Rourke discusses current market and economic conditions, and why he believes myriad market risks are conspiring against a continued bull market run.

 

2. 4 Stocks Hurt By The Retail Slowdown (7/22/2016)

 

 

In this excerpt from The Macro Show, Hedgeye Retail analyst Alec Richards and Macro analyst Ben Ryan discuss the companies most vulnerable to the ongoing retail slowdown.

 

3. About Everything: The Decline of the Film Industry & Its Investing Implications (7/21/2016)

 

 

In this complimentary edition of About Everything, Hedgeye Demography Sector Head Neil Howe discusses why the movie industry is in decline and breaks down the broader implications for investors.

 

Click here to read the associated About Everything writeup.

 

4. Macro Meets Micro: Behind The Bursting Biotech Bubble (7/21/2016)

 

 

In this excerpt from The Macro Show earlier today, Hedgeye CEO Keith McCullough and Healthcare analyst Andrew Freedman discuss the macro and micro fundamentals behind the bursting biotech bubble.

 

5. REPLAY | Q&A with Tom Tobin - What to Expect in Healthcare (7/18/16) 

 

CLICK HERE TO ACCESS THE ASSOCIATED SLIDES.

 

**Johnson & Johnson (JNJ) reported this morning and set the quarter's tone for the rest of Healthcare.

 

Hedgeye Healthcare Sector Head Tom Tobin and analyst Andrew Freedman were the studio today to discuss specific implications for ATHN, AHS, MDRX, ILMN, ZBH, HOLXand MD. Tom and Andrew recapped last week's Themes Presentation, which included a comprehensive overview of our #ACATaper and Healthcare Deflation themes with new datasets and analysis.

 

6. McCullough: Buy The All-Time High? (7/18/2016)

 

 

In this excerpt from The Macro Show this morning, Hedgeye CEO Keith McCullough cautions subscribers and advises what investors should consider as U.S. equities hit an all-time high.


Investing Ideas - Levels

Takeaway: Please see below Hedgeye CEO Keith McCullough's refreshed levels for our high-conviction Investing Ideas.

Have a great weekend.

 

Investing Ideas - Levels - z levels bro

 

Trade :: Trend :: Tail Process - These are three durations over which we analyze investment ideas and themes. Hedgeye has created a process as a way of characterizing our investment ideas and their risk profiles, to fit the investing strategies and preferences of our subscribers.

  • "Trade" is a duration of 3 weeks or less
  • "Trend" is a duration of 3 months or more
  • "Tail" is a duration of 3 years or less

Why I Remain An Unrepentant Bear

Takeaway: Buyer beware warns market strategist Mike O'Rourke.

This is an excerpt from a special presentation Mike O’Rourke, Chief Market Strategist at Jones Trading gave to Hedgeye’s 2016 summer intern class. In this clip, O’Rourke discusses current market and economic conditions, and why he believes myriad market risks are conspiring against a continued bull market run.

 


investing ideas

Risk Managed Long Term Investing for Pros

Hedgeye CEO Keith McCullough handpicks the “best of the best” long and short ideas delivered to him by our team of over 30 research analysts across myriad sectors.

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