Correlations

*source Factor Ad visors, Reformed Broker

S&P 500 Valuation measures

Key Levels for all markets

Important levels for equity and commodity markets

source Macroman.wordpress.com

Equity and Oil Correlation

As oil remains at higher levels, the correlation of crude oil and equity markets are slowly receding. IN last couple of year, the correlation has moved from negative to positive and now the correlation seems to reducing. Circa 2008, when oil made a high of $ 147 . the corrleation was negative as the highger crude prices were squeezing profit margins of companies and stoking inflation. but in 2009 when world was struggling with recession, oil and equity markets had strong positive correlations as better economic scenario meant more demand for crude.

USD vs Stocks

Historically US Dollar and equity markets share a negative correlation. USD after making a low, is showing some strength and might bounce back. this is not a good sign for equity market whcih is already on its weaker side. any appreciation is USD can bring a decent correction in equity markets

Equity markets looming over bear phase

SnP 500 is on the thin red line of 200dma. Technically a close below 200 DMA will ensure prolonged correction and a bear market in near future. So next few days or weeks will determine where are we headed for the future. last few of my post suggest that there may be deep correction in the offing.now the question is what will trigger that, will it be greece or euro default or insane commodity prices, or maybe anemic growth.

Bond Market Suggest another sell-off

Another indicator which suggests a sell off in near future. For last few weeks i ve been looking into a lot of indicators (few of the thm i ve already posted) which are suggesting a decent correction in equity markets.Though im not sure when it will happen and how it will happen, but something big is on its way. I think its time to books some of profits and sit on cash for sometime.

Correlation between US equity Market and USD

For the first time i have seen S&P 500 and USD moving in tandem. it may be aberration or it might be signals of tectonic shifts in world economy

Believe it or Not

Now believe it or Not US stocks were the best performers compared to all emerging market. so all the hullabaloo over US perishing and EM frenzy is far from reality. The above graphic shows the dollar adjusted returns

S&P 500 returns in 2010

Bullish December

Contrary to popular belief, the month of december has consistently given positive returns over the period of time. Popular notion is that Investors, fund managers sell off thier position in december, which is a holiday season and come back in January to take fresh positions again.
But statistically speaking, December as a month is bullish and given better returns than other months

Earnings Warnings

chart illustrates how earnings declined over 92% from its Q3 2007 peak to Q1 2009 low which brought inflation-adjusted earnings to near Great Depression lows. Since its Q1 2009 low, S&P 500 earnings have surged (up over 900%) and have just crossed above a level that occurred at the peak of the dot-com bubble. In fact, earnings have only been higher than current levels for a 29-month stretch that occurred at the tail end of the credit bubble.

SnP reversal

Candle stick patterns shows a shooting star and a hammer.. seems not all is well with equity markets

Overbought Markets

Leading Indicators

Economy also showing reasons to take a dip

Equity markets due for a leg down

Text book pattern for a leg down in equity markets. 50 Dma crossing over 200 Dma. check what happened when the Moving averages crossed over.

Dollar Vs Equity

i think QE 2 will push dollar down and Equity up. Markets are waiting for an event to break out.QE 2 might be tht event

Break Out ?

Break out or just a Stop loss triggering. Generally market tends to remain rangeboud before important economic announcements and events