CHART OF THE DAY: Quad4 → A Strong Dollar Story

07/26/19 07:42AM EDT

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 about the Early Look.

CHART OF THE DAY: Quad4 → A Strong Dollar Story - z2

On the heels of a critical “catalyst” day for those begging for more central-market-planning #cowbell, the stock market reaction to Mario Draghi’s latest ideas on devaluing The Euro and extending negative rate policy… was negative.

Yep, it was a Quad 4 Day, indeed. As a back-tested reminder on what happens in Quad 4 from a USD vs. US Equity market perspective: 

A) The US Dollar has its highest expected value in Quad 4 (see Chart of The Day)
B) Inflation Expectations (priced in Dollars) fall
C) High Beta Equity Exposures expecting perpetual “asset price reflation” deflate 

CHART OF THE DAY: Quad4 → A Strong Dollar Story - CoD USD Quad 4

© 2024 Hedgeye Risk Management, LLC. The information contained herein is the property of Hedgeye, which reserves all rights thereto. Redistribution of any part of this information is prohibited without the express written consent of Hedgeye. Hedgeye is not responsible for any errors in or omissions to this information, or for any consequences that may result from the use of this information.