Q3 High Alternatives Overview:Regardless of some twists and turns, the primary half of the 12 months was certainly in regards to the progress stor
Q3 High Alternatives Overview:
- Regardless of some twists and turns, the primary half of the 12 months was certainly in regards to the progress story, and heading into 3Q’21, it seems that the tune will stay the identical.
- The lengthy US equities story is about to proceed into the second half of the 12 months.
- As lengthy because the bull case for international progress stays, then power needs to be in sturdy demand.
Development Story Stays Robust
Central banks stay accommodative whilst they sign the tip of crisis-era efforts; fiscal authorities proceed to supply assist with additional authorities spending will increase anticipated out of each Europe and North America; and rising vaccination charges, and excessive efficacy of present vaccines, means that the delta variant story is changing into a ‘wall of fear’ for markets to climb within the second half of 2021.
US S&P 500 (SPX) TECHNICAL ANALYSIS: DAILY CHART (June 2019 to June 2021) (CHART 1)
The lengthy US equities story is about to proceed into the second half of the 12 months, and now that the runaway inflation narrative has been nipped within the bud (insofar because the Federal Reserve has been hammering the notion that worth pressures are transitory, and now that offer chain pressures are easing, extra of the market is ‘shopping for’ the story the Fed is ‘promoting’).
With fairness volatility time period construction suggesting calm seas forward, it’s doable we’re coming into a interval which may be finest described as a ‘sluggish grind larger.’ Each the US S&P 500 and the US NASDAQ 100 look on extra favorable technical footing than most developed market counterparts (and rising market counterparts, too); the previous is focusing on 4350; the latter is focusing on 15220.
CRUDE OIL (US OIL) TECHNICAL ANALYSIS: DAILY CHART (June 2019 to June 2021) (CHART 2)
Whereas the lengthy copper/quick gold pair commerce nonetheless is smart thematically, there’s an argument to be made that latest shifts within the basic backdrop for copper make it a much less viable automobile to precise a pure progress view.
With international demand rising at a torrid tempo post-pandemic, the OPEC+ announcement that manufacturing cuts will stay in place maintain the near-term supply-demand imbalance as a viable catalysts for extra positive aspects in crude oil costs.
— Written by Christopher Vecchio, CFA, Senior Foreign money Strategist
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