03/20/2021 Weekend Update

[Cobra]

Down 1 week, the next week has 60% chances to close up.

[Al_Dente]

If you took ALL the sector SPDRs, and weighted them all together as one, you would get EQL.

“The Equal Sector Weight ETF (EQL) takes a unique approach to domestic equity exposure; each of the major sectors of the U.S. economy receive an equivalent allocation. This approach might be appealing for a couple of reasons; it prevents establishing big allocation to sector-specific “bubbles”, and also allows investors to participate in rallies in corners of the economy that are not always well represented in traditional equity products.

“Note that this version of equal weighting does not necessarily deliver equal weights at the individual stock level; because EQL’s holdings actually consist of sector SPDRs, this fund can be thought of as a blend between market cap weighting (at the individual stock level) and equal weighting (at the sector level).

[Al_Dente]

Decision Point: "... beware this new IT [Intermediate Term] PMO SELL signal"
Interesting how she charts the "silver cross" (20/50ema cross) and the "golden cross" (50/200ema cross)
First chart is weekly. Scroll down to her second chart for daily.
https://stockcharts.com/articles/chartw ... u-839.html


https://stockcharts.com/public/1684859

[Cobra]

If you took ALL the sector SPDRs, and weighted them all together as one, you would get EQL.

“The Equal Sector Weight ETF (EQL) takes a unique approach to domestic equity exposure; each of the major sectors of the U.S. economy receive an equivalent allocation. This approach might be appealing for a couple of reasons; it prevents establishing big allocation to sector-specific “bubbles”, and also allows investors to participate in rallies in corners of the economy that are not always well represented in traditional equity products.

“Note that this version of equal weighting does not necessarily deliver equal weights at the individual stock level; because EQL’s holdings actually consist of sector SPDRs, this fund can be thought of as a blend between market cap weighting (at the individual stock level) and equal weighting (at the sector level).

319eql.png.jpg

Hmm, nice, thanks. Too bad it doesn't have leveraged fund, does it?

[Cobra]

$AAII Bull - $AAII Bear shows retailers remain bullish.

[Al_Dente]

THREE HORSEMEM and one turkey.
The banks [KBE] might become the next turkey, because of the FED’s comments Friday [3/19/21]:
Last spring the FED loosened leverage rules that the large banks must abide by. But on Friday, US regulators said they would allow the leverage exemption to expire at the end of the month…
Here's how the exemption worked: Last spring the Federal Reserve, FDIC and Office of the Comptroller of the Currency granted big banks a waiver allowing them to bulk up on ultra-safe US Treasuries and take in a surge of deposits without the usual penalty.
Those penalties are typically levied when banks flout rules around what's known as the supplementary leverage ratio, or SLR. It requires the biggest US banks to hold capital of at least 5% of total assets on — and off — their balance sheets. It's essentially a forced buffer, with the goal of preventing banks from becoming too leveraged.
But with the pandemic raging, the Fed announced that on April 1 it would temporarily exclude US treasuries and deposits held at Fed banks from the SLR calculation.
The FED plans to invite public comment on several modifications to the leverage rule … so we’ll see ...
BUT... There could be a silver lining: Allowing the relief to expire could ease pressure on the Fed to limit bank dividends and share buybacks.
https://www.cnn.com/2021/03/19/investin ... index.html

[Al_Dente]

From the “LEARN SOMETHING NEW EVERY DAY” Department.
Mish Schneider uses sugar (symbol: CANE) to gauge inflation.
https://stockcharts.com/articles/mish/2 ... a-486.html

[Al_Dente]

If you took ALL the sector SPDRs, and weighted them all together as one, you would get EQL....

Hmm, nice, thanks. Too bad it doesn't have leveraged fund, does it?

No boss, I can't find a leveraged equivalent

[Al_Dente]

Jason's proprietary indicator for INFLATION.
SPOILER ALERT: "...despite all of the endless chatter, blather, hand-wringing, and fear and loathing of late regarding any "inevitable" burst of inflation, for the time being, anyway, you might be better off worrying about something else."
https://sentimentrader.com/blog/where-i ... -it-means/

[Al_Dente]

OUCH
Friday (3/19/21) the Justice Department informed VISA (V) that it plans to open an investigation into Visa's U.S. "debit practices."
“...for engaging in potentially anticompetitive practices in the debit card market…. DOJ thinks Visa may have "limited merchants' ability to route debit-card transactions over card networks that are often less expensive" than Visa's own, boosting Visa's share of "lucrative" network fees on debit cards' use. ” [WSJ]
V was down -6.24% Friday, while MA was down due to domino worries, but only -2.86%

BTW: Visa is 4.4% of the dow $INDU (or 4.17% depending on your source), and 344 ETFs have exposure to Visa, including IYF which has a 5.93% weighting in Visa, and XLK [WHAT !!!] has a 4.27% weight in Visa...

These “investigations” typically take a long time, and a negative resolution may hurt the whole financial sector (and maybe the whole market). Better to reduce exposure to the whole sector until this clarifies.


https://stockcharts.com/public/1684859

[Cobra]

According to the Stock Trader's Almanac, seasonality favors bears till the end of March.

[Cobra]

10 Years yield is very close to resistance now so a pullback should be due soon. The bad news is, the push up has been so strong therefore likely at least it should have another leg up.

[Al_Dente]

zh and Goldman's Prime Broker desk said the rally from about 3/9 to about 3/17 was a short-covering squeeze [GS: "trading flows were risk-off with short covers outpacing long sales 4 to 1." ], then the squeeze paused and the big guys reloaded more shorts on the way down.
From GS Friday: “... in a reversal of last week’s buying activity, "the GS Prime book saw the largest $ net selling since Dec ‘18 ... driven by short sales and long sales (3 to 1)." 
GS says: “all regions and sectors saw increased shorting ...[last]… week.“ [not just the Nasdaq where “every squeeze higher has been met with a fresh burst of shorting.”]
So now the setup is near for another short-covering squeeze… zh: “Another Mega Short Squeeze On Deck “...in the week ahead”
Oy

[JFR]

I don't have a url for this article, It is from a broker.

Growth is in. Value is out.

As Blackstone Barrels Toward Trillion-Dollar Asset Goal,
Growth Is In, Value Out; Jonathan Gray is guiding shift at
investment firm that made its name buying into undervalued
companies

Blackstone Group Inc. became an investing powerhouse by making successful bets on
undervalued companies. For the next leg of its expansion, the firm is focused on companies with
big growth prospects, even if it has to pay up for them.

Since Jonathan Gray became Blackstone's day-to-day leader in 2018, he has encouraged the
heads of its businesses, who collectively manage $619 billion of assets, to develop big-picture
convictions and invest in companies or assets that stand to benefit from those trends.

The new approach has led the New York firm to plow billions into faster-growing companies—
including in the technology sector—to which it previously paid less attention.

It has taken Blackstone out of its traditional comfort zone of turning underperforming companies
around through cost cuts and efficiency improvements—and juicing returns by employing ample
helpings of borrowed money.

The growth bug has bitten nearly every corner of the sprawling firm, including its real-estate,
credit and hedge-fund businesses. Among the assets in its main buyout fund is a big stake in
Bumble Inc., which Blackstone acquired in 2019 in a deal that valued the owner of the dating app
at $3 billion. The stake has nearly quintupled in value as the company's market capitalization
shot to about $14 billion following its February initial public offering.

Mr. Gray's thematic approach and the growth orientation it has spawned show how the 51-yearold heir-apparent to Chief Executive Stephen Schwarzman is making his mark on the firm as it
barrels toward a goal of managing $1 trillion in assets by 2026.

"Investing is about looking forward, but the future is now coming faster," he said in an interview.
"You want to be exposed to businesses that benefit from this change."

A big goal of his is for employees in the firm's disparate businesses to all think about the same
themes and discuss them with each other.

Blackstone has long been interested in identifying growing industries, but under Mr. Gray has
become more clear about what it won't buy, said Joseph Baratta, global head of private equity at
the firm. In addition to brick-and-mortar retailers, that list includes established media-andtelecommunications providers and companies reliant on single-use plastics.

"There are certain types of companies that we're just not going to invest in, no matter how cheap
they are," Mr. Baratta said.

The strategy isn't without risk. The assets the firm is collecting could be among the first to get hit
if, for example, the recent increase in interest rates continues as the economy emerges from the
pandemic-induced lockdown.