• Investing Insights & Exclusive Offers → Get Our FREE “Market Brief”
    Sign-up for our free weekly newsletter. Get unparalleled investing insights and exclusive Summer Sale discounts on Hedgeye research.

    Disclaimer: By joining our email marketing list you agree to receive marketing emails from Hedgeye. You may unsubscribe at any time by clicking the unsubscribe link in one of the emails. Use of Hedgeye and any other products available through hedgeye.com are subject to our Terms Of Service and Privacy Policy

Below is a chart and brief excerpt from today's Early Look written by Hedgeye CEO Keith McCullough.

When something big (like Bearish USD) is signaling something new, other big things start to signal something new as well. For those who are one-way, perma-marketing certain asset classes, that critical and objective part of my process doesn’t work for them.

Gold, for example, should never be owned when Real Yields are rising. That’s why I was unpopular with the Gold Bug establishment in 2017 and into 2018 until my signal (and economic Quad) said it was buy Gold time back in Q4 of 2018.

Similarly, when The Signal (and economic Quad) agreed that the peak of the US economic and profit cycle was in (Q3 of 2018), we went bearish on Small Caps & Speculative Credit. Last week here’s what Gold did vs. the Russell 2000, in context of The Cycle:

  1. Gold was up another +1.6% last week taking its Full Investing Cycle return to +48.3% since Q4 of 2018
  2. Russell 2000 (IWM) was down another -2.8% last week taking its Full Cycle Crash to -20.8% since Q318

Fortunately for all of you Full Cycle Investors, these are examples of dramatic #divergences that can’t be explained with a narrative that denies the solar system or The Cycle’s existence. 

CHART OF THE DAY: "Stahks" Are Not The Center Of The Investing Universe  - Chart of the Day