Pascal, David Rosenberg forecast write up in a Market Watch article.
https://www.marketwatch.com/story/fe...KLY22_AUTO_NAH
In the oncoming future economic hardship that's being forecasted by economists has me seeking answers as to how is this recession and rate cut going to unfold? I would like hints on what indicators to check on, which one are messaging the trend?
This article gives me a roadmap for the landmarks I might observe during this negative journey. Rosenberg may not be completely right, however I now have something to compare with data. Steve
https://www.marketwatch.com/story/fe...KLY22_AUTO_NAH
In the oncoming future economic hardship that's being forecasted by economists has me seeking answers as to how is this recession and rate cut going to unfold? I would like hints on what indicators to check on, which one are messaging the trend?
This article gives me a roadmap for the landmarks I might observe during this negative journey. Rosenberg may not be completely right, however I now have something to compare with data. Steve
So, for now, it is important that we continue looking at equities valuation model in terms of yield comparison. Indeed, the 10Y yields should drop well below 3.4% in order for equities to become attractive... and yields will drop probably only if there is a recession.
The above Figure tells us that equities are overvalued here and the Figure below tells that the momentum has turned down.
However, the equities Money Flow has been positive since January. It is as if investors were already anticipating a 10Y rate reversal.
Besides the above indicators, I would look at IYR and VNQ, which tell mood of real estate regarding interest rates. As far as the TEV pattern stays below its Pink line, this tells us that real estate investors do not expect lower rates soon.
Then, the NHNL indicator will tell us when to buy market panic.
Conclusions:
1. Wait for a reversal in IYR/VNQ TEV patterns
2. Wait for a NHNL bottom, which will also coincide with a 20DMF bottom