• It's Here!

    Etf Pro

    Get the big financial market moves right, bullish or bearish with Hedgeye’s ETF Pro.

  • It's Here

    MARKET EDGES

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

Our Take: The Long-Term Market Picture Versus the Short-Term - tightrope

Balancing your long-term investing view against the short-term is one of the hardest things for investors to do. 

"I’ve spent 18 years trying to figure out the difference between my short and long-term market views," writes Hedgeye CEO Keith McCullough in today's Early Look, "And I’m still working on it…"

So here's our current market view right now across durations, according to McCullough:

Short-Term 

(TRADE duration, 3-weeks or less)

Both the US Dollar and sectors most tethered to the S&P 500 like Financials (XLF) are overbought.


Long-Term 

(TAIL duration, 3-years or less)

Super bullish on both the US Dollar and the prospects for Millennial Generation Consumption Growth Accelerating 

more On the Short-Term...

#Dollar $SPY #Nasdaq

We've been writing a lot about the short-term lately and how the U.S. stock market might be topping (click here for more). We say U.S. equities, in particular the Nasdaq, is overbought.

Case in point, total stock market volume (aggregate buying and selling) continues to decelerate on up days in the market, as conviction dissipates with each all-time high. Stock market volume was down -10% versus its 1-month average yesterday. 

Our Take: The Long-Term Market Picture Versus the Short-Term - volume 2 14 17

more On the long-term...

#Millennials #Consumption

See the Chart of the Day below.

According to Pew Research, "Millennials" (the word coined by Hedgeye Demography head Neil Howe) are defined as those ages 20-36 in 2017. There are a grand total of 75.4 million Millennials, now surpassing the 74.9 million in Baby Boomers (ages 53-71).

Our research suggests that halfway through Trump's term, at the beginning of 2020, Millennials will reach the key consumption threshold of 35 to 54 years old. In other words, the private sector deleveraging will begin to dissipate and add to U.S. economic growth. 

That's bullish for the U.S. Dollar.

Our Take: The Long-Term Market Picture Versus the Short-Term - 02.14.17 EL Chart

Bottom Line

"No one ever went broke booking gains," McCullough wrote earlier today. With the market at all-time highs and market signals like volume breaking down, we say book some gains so you can buy the long-term bull case back lower. That's it.