The weekly market reports include a market position update, a stock market forecast, and an analysis of capital markets. To access the full report, you must subscribe to Premium Articles, Weekly Premium Articles, or All-in-One.
Weekly Market Report
- Ensemble performance.
- Weekly summary.
- Update on market positioning.
- Stock market forecast
- Capital markets update.
- Section 2 of the report discusses the news about the Microsoft quantum chip and whether it was an attempt to pump the market.
- In Section 5, we review two pair trades and offer clues about the next possible big trade.
- We added IBIT iShares Bitcoin Trust ETF to the weekly summary and capital markets updates.
1. Ensemble performance
We use two long-only cross-sectional momentum strategies to generate signals for capital markets and factor ETFs. See Section 3 below for open positions and signal updates.
Year-to-date, the weekly strategies (WeeklyReport) are up 4.5% (equal allocation, no leverage) versus a gain of 2.4% for the SPY ETF. The ensemble’s outperformance is due to strong gains in momentum and gold.
Gold (GLD) is up 11.8% year-to-date. The US dollar index (UUP) is down 1.2%, and long-duration bonds (TLT) are up 3%. Since 2024, the ensemble is up 31.6% versus 27.8% for the SPY ETF. The ensemble’s beta since 2017 is 0.46, and correlation with the S&P 500 index is 0.73. The annualized return is 9.3%, and the maximum drawdown is 17%. The Sharpe ratio is 0.85. See Section 3 for details on market positioning.
2. Weekly summary (February 18–February 21, 2025)
- Stocks fell in the holiday-shortened week after weak economic data.
- Large-cap stocks (SPY) ended the week with a 1.6% loss.
- Gold (GLD) gained 1.7% to finish the week near all-time highs.
- Long-duration bonds rebounded after weak economic data. The TLT ETF ended the week up 0.5%.
- Commodities were mostly down but precious metals gained. The DBC ETF gained 1% for the week.
- Bitcoin fell on the week 2.5% as the correlation with the stock market remains elevated. See Section 5 for more details.
- Since January 3, 2022, bonds (TLT) have been down 33.1%, while gold (GLD) and large caps (SPY) have gained 58.4% and 32%, respectively.
- The equally weighted Magnificent Seven stocks index fell 3.3% for the week. Microsoft (MSFT) was up 0.2%, and Apple (AAPL) gained 0.4%. Meta Platforms (META) plunged 7.2%.
- Market sector performance was mixed. See below for more details and whether current sector dynamics are offering any signals.
Sector performance
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Specific disclaimer: This report includes charts that may reference price levels. If market conditions change the price levels or any analysis based on them, we may not update the charts. All charts in this report are for informational purposes only. See the disclaimer for more information.
Disclaimer: The Weekly Market Reports are provided for informational purposes only and do not constitute investment advice or actionable content. We do not warrant the accuracy, completeness, fitness, or timeliness for any particular purposes of the Weekly Market Reports. Under no circumstances should the Weekly Market Reports be treated as financial advice. The author of this website is not a registered financial adviser. Before subscribing, please read our Disclaimer and Terms and Conditions.
Charting and backtesting program: Amibroker. Data provider: Norgate Data
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