Trends Up, Bull On, Risk High (Macro Discussion)

Summary

• The broad bull rally has been expected to continue "to or through the US presidential election," despite emerging risks highlighted by yield curve dynamics.
• The divergence between the 2-year Treasury yield and the 3-month T-bill yield has been a bigger picture market risk indicator, reminiscent of pre-bear markets in 2000 and 2007.
• Gold is poised to rise dramatically in relation to cyclical assets in a "post-bubble" macro environment, although its nominal price is currently stretched and at risk price-wise.
• Stay vigilant and understand your holdings within the current macro backdrop, as risk signals are building and the market may not even sustain its rally through the election.

Shutthiphong Chandaeng

The article’s title might also read “Another Week, Status Unchanged”, as it has been for so long now. That status targets “to or through the election” for the broad bull rally, as it has all year long (with a few caution points along the way).

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.