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Why We (Really) Like Short LuluLemon | $LULU

He may wear Lululemon’s clothes, but Hedgeye Retail analyst Alec Richards is recommending investors short the stock. He gives a granular look into why shares of LuluLemon (LULU) have considerable downside from here.


Mr. Rosengren, What Are You Thinking?

Takeaway: The Fed hatches (yet) another headscatcher.

Mr. Rosengren, What Are You Thinking? - z cbb

well Now you know

 

This is what your portfolio will look like if the Fed hikes (again) into a slowdown.

 

Boston Fed head Eric Rosengren's "time to hike" comments must be part of a new Federal Reserve policy initiative to be anti-data-dependent. In the face of very obvious U.S. #GrowthSlowing data, he just ramped the Fed Funds Futures on a SEP hike from 20% to 34%

 

 

That's why stocks and bonds are down. That's also giving you an immediate-term TRADE oversold signal in most things I like.

 

I'll leave you with the chart below. Wasn't this Janet Yellen's favorite indicator once upon a time?

 

Mr. Rosengren, What Are You Thinking? - z lmci


TIF: We Are Removing Tiffany From Investing Ideas

Takeaway: Please note we are removing TIF from Investing Ideas (short side) today.

"I'm booking it on this pullback," writes Hedgeye CEO Keith McCullough.

 

Our Retail team remains bearish on the luxury jewelry and specialty retailer. They believe sales should still slow, as its traditional customer gradually shifts away from the brand, sales per square foot weakens, and margins compress as the inability to sell successfully online while maintaining brand cache plagues the long-term story. Bottom line is numbers remain too high.

 

TIF: We Are Removing Tiffany From Investing Ideas - ztif


Daily Trading Ranges

20 Proprietary Risk Ranges

Daily Trading Ranges is designed to help you understand where you’re buying and selling within the risk range and help you make better sales at the top end of the range and purchases at the low end.

RTA Live | September 9, 2016


September 9, 2016

Want more from Daily Trading Ranges? CLICK HERE to submit up to 4 tickers you'd like to see on the list. 

 

  • Bullish Trend
  • Bearish Trend
  • Neutral

INDEX BUY TRADE SELL TRADE PREV. CLOSE
UST10Y
10-Year U.S. Treasury Yield
1.63 1.51 1.61
SPX
S&P 500
2,166 2,190 2,181
RUT
Russell 2000
1,235 1,264 1,258
COMPQ
NASDAQ Composite
5,190 5,292 5,259
XOP
SPDR S&P Oil & Gas Explore
36.78 39.26 39.12
RMZ
MSCI US REIT
1,210 1,252 1,234
NIKK
Nikkei 225 Index
16,399 17,215 16,958
DAX
German DAX Composite
10,508 10,790 10,675
VIX
Volatility Index
11.59 14.48 12.51
USD
U.S. Dollar Index
94.50 96.41 94.97
EURUSD
Euro
1.11 1.13 1.12
USDJPY
Japanese Yen
100.27 104.38 102.49
WTIC
Light Crude Oil Spot Price
42.86 48.61 47.62
NATGAS
Natural Gas Spot Price
2.61 2.95 2.81
GOLD
Gold Spot Price
1,302 1,360 1,341
COPPER
Copper Spot Price
2.05 2.12 2.10
AAPL
Apple Inc.
104.03 108.60 105.52
AMZN
Amazon.com Inc.
752 790 784
JPM
J.P. Morgan Chase & Co.
65.80 67.99 67.25
INTC
Intel Corp.
35.19 36.98 36.44
LVS
Las Vegas Sands Corp.
52.64 57.12 55.68
CMG
Chipotle Mexican Grill
399 441 436

Hedgeye's Daily Trading Ranges are twenty immediate-term (TRADE) buy and sell levels, along with our intermediate-term (TREND) view.  Click HERE for a video from Hedgeye CEO Keith McCullough on how to use these risk ranges.


Stocks and bonds down (at the same time) on “inflation rising” fears? Fade that.

Client Talking Points

Yields

Post yesterday’s Oil pop, broad-based pop on the long-end of the curves, globally, with 10yr JGB and Bund yields in a dead heat at -0.02% - isn’t that riveting? If the Fed raises rates on “inflation” (and ignores the #GrowthSlowing data), they’ll crash oil and commodities again anyway. Big buying opportunity in long-term bonds this morning.

Oil

Pop, drop, #WickedChop – WTI fails at the top end of the @Hedgeye risk range ($42.86-48.61) and drops -1.3% this morning; supply data aside, we didn’t want to be short oil at the low-end of the range into slowing US economic data (Fed forced to pivot back to dovish = reflation) inasmuch as we don’t want to chase it at the top-end of the range.

Volume

Big US Equity Volume day yesterday (+21% vs. the 1-month average) – why? It was a down day. Volume comes back on the down days but SP500 still looks range-bound in the 2166-2190 risk range to me. If math changes on that, we will.

Asset Allocation

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
9/8/16 59% 2% 4% 6% 23% 6%
9/9/16 58% 3% 5% 7% 25% 2%

Asset Allocation as a % of Max Preferred Exposure

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
9/8/16 59% 6% 12% 18% 70% 18%
9/9/16 58% 9% 15% 21% 76% 6%
The maximum preferred exposure for cash is 100%. The maximum preferred exposure for each of the other assets classes is 33%.

Top Long Ideas

Company Ticker Sector Duration
GLD

See updates below.

TLT

Income & Consumption

Slowing employment growth + a decline hours worked + deceleration in earnings growth will = a deceleration in aggregate income growth when the official data are reported at the end of the month.  Absent a significant decline in the savings rate and/or significant re-acceleration in credit growth, consumption growth can be expected to track income growth lower. 

UUP

Industrial Activity 

The -14K decline in manufacturing employment in August accords with the retreat in the employment subcomponent in the ISM manufacturing report.  Lower manufacturing employment and a slowdown in manufacturing hours worked also points to a sequential decline in Industrial Production when that data is reported later in the month.  In short (and in the short-term), bad economic data is good as falling rate hike expectations support asset price inflation.  Over the intermediate-term, "slower-and-lower-for-longer" continues to characterize the growth, inflation and interest rate outlook and support #GrowthSlowing allocations in bonds, gold, and dollars.   While incremental dovishness from the Fed may serve as a short-term headwind to the dollar, the structural case for the $USD amidst ongoing policy divergence between the U.S. and the balance of global DM markets remains intact.   

Three for the Road

TWEET OF THE DAY

Live Q&A "Medicaid for the Middle Class?" @HoweGeneration @HedgeyeHC 12PM ET #ACA *Access: app.hedgeye.com/insights/53673… pic.twitter.com/V3XTH8mjrG

@Hedgeye

QUOTE OF THE DAY

I think that the team that wins game five will win the series.  Unless we lose game five."

-Charles Barkley

STAT OF THE DAY

Trevor Siemian completed 18 of 26 for 178 yards and 1 TD last night.


Early Look

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