Prepare to be Bullish and Bored

True bull markets have a low-volatility profile. Volatility lives it's best life in bear market. Bears will wish they read this blog.

Author

Bootleg Macro
September 29, 2024

On the New Highs Lists you’ll see a lot of China, Communications, Real Estate and Technology. Surprisingly a lot of Utilities, but I suspect they burn off over the next year into mid-2025 (call it Summer 2025).

We should start to hear BUBBLE talk in Summer 2025.

What’s at stake in this moment in the market? Not much, we are expecting more rate cuts so the future even from here has better days ahead due to liquidity.

Flows drive the market.

What’s important is knowing when to shift gears. Can you shift into easy trader mode? The chop should disappear if the VIX stays under 19.

When to go from tortoise speed to hare speed. It’s crucial to understand BULL MARKETS are low on volatility.

So prepare to be BORED and BULLISH.

See you next week:

- Dustin

Market Performance

Indexes were all up. VIX has a small flare up. We can see up to $19 on the VIX and feel it’s buy the dip. 18 VIX is possible but unlikely when we have rate cuts, refinancing, loan growth and stimulus.

There is an opportunity for politics to add in volatility but that’s temporary. Buy dips, especially big dips when non-sense gets into markets.

The dollar will be devalued from here for the next 12-18 months. Trust the trend in the dollar devaluation and you’ll find setups.

A basic trend - nothing special but that’s why it’s BETA.

A basic week up less than 1%.

This had the best week.

Volatility Corner:

VIX / VVIX improved! Blue up is good, blue down is bad. The blue line has a HIGH CORRELATION to overall markets. You see the up and down…we are below the 10 week and 23 week right now. My idea is that the VIX collapses this coming week when enter October and closer to Nov. It’s the season for market gains to start.

And I do not see a convincing trend in this indicator. You can see the times when the market is down, the indicator is trending in the 10 week and 23 week averages downward. When we are back to BULLISH behavior, we can see at the start of 2023 - the 10/23 week avgs trended higher.

Right now we see nothingness. So I have to default to BULLISH behavior.

MACRO INDICATOR:

I don’t think this is true for much longer. Bullishness is coming.

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New Highs $5-$20:

  1. FINV - FinVolution Group ADR | Financial | China 🇨🇳

  2. INFN - Infinera Corp. | Technology | USA 🇺🇸

  3. NCMI - National CineMedia Inc | Communication Services | USA 🇺🇸

  4. MOMO - Hello Group Inc ADR | Communication Services | China 🇨🇳

  5. TAC - Transalta Corp. | Utilities | Canada 🇨🇦

  6. WWW - Wolverine World Wide, Inc. | Consumer Cyclical | USA 🇺🇸

  7. BVS - Bioventus Inc | Healthcare | USA 🇺🇸

  8. DEI - Douglas Emmett Inc | Real Estate | USA 🇺🇸

  9. HBI - Hanesbrands Inc | Consumer Cyclical | USA 🇺🇸

  10. DOYU - DouYu International Holdings Ltd ADR | Communication Services | China 🇨🇳

FINV - FinVolution Group ADR | Financial | China 🇨🇳

This is very overbought - this is over the top of the range. Let is rest.

INFN - Infinera Corp. | Technology | USA 🇺🇸

The market looks nice here. Nothing too overbought.

NCMI - National CineMedia Inc | Communication Services | USA 🇺🇸

This low volatility recently is a nice setup to me.

MOMO - Hello Group Inc ADR | Communication Services | China 🇨🇳

TAC - Transalta Corp. | Utilities | Canada 🇨🇦

Small pullback but it needs to fall more for a good opportunity.

WWW - Wolverine World Wide, Inc. | Consumer Cyclical | USA 🇺🇸

We are chasing wolverines here. This price is screaming higher like a claw in Logan’s hand.

BVS - Bioventus Inc | Healthcare | USA 🇺🇸

I’m surprised this is doing so well, I expect healthcare to weaken so this is nice to see.

DEI - Douglas Emmett Inc | Real Estate | USA 🇺🇸

All Real Estate has the wind at it’s back due to current and future rate cuts.

We are hitting new highs in some real estate stocks. Across the board.

HBI - Hanesbrands Inc | Consumer Cyclical | USA 🇺🇸

This a a good history, low price and easy to understand.

DOYU - DouYu International Holdings Ltd ADR | Communication Services | China 🇨🇳

Not pretty at all. This should and can be ignored.

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New Highs $20+:

  1. KRNT - Kornit Digital Ltd | Industrials | Israel 🇮🇱

  2. UTG - Utilities Trust of Australia | Utilities | Australia 🇦🇺

  3. GEN - Gen Digital Inc | Technology | USA 🇺🇸

  4. SKT - Tanger Inc | Real Estate | USA 🇺🇸

  5. EDR - Endeavor Group Holdings Inc | Communication Services | USA 🇺🇸

  6. BIP - Brookfield Infrastructure Partners L.P | Utilities | Bermuda 🇧🇲

  7. FOX - Fox Corporation | Communication Services | USA 🇺🇸

  8. SWK - Stanley Black & Decker Inc | Industrials | USA 🇺🇸

  9. AXP - American Express Co. | Financial | USA 🇺🇸

  10. DE - Deere & Co. | Industrials | USA 🇺🇸

KRNT - Kornit Digital Ltd | Industrials | Israel 🇮🇱

This thing has made millionaires this summer. When you’re up 77% in 3 months, you know it’s been a BRAT summer.

UTG - Utilities Trust of Australia | Utilities | Australia 🇦🇺

Nice and smooth - this trend is too good but can you afford to not take a small position? I can. You make your decision.

GEN - Gen Digital Inc | Technology | USA 🇺🇸

This is at the top of it’s range but I love the low volatility plays.

SKT - Tanger Inc | Real Estate | USA 🇺🇸

Real Estate has the wind at it’s back for the rest of the rate cuts.

EDR - Endeavor Group Holdings Inc | Communication Services | USA 🇺🇸

This move is very over done. Sometimes you have to board rocket ships. I don’t know here. The sphere was cool!

BIP - Brookfield Infrastructure Partners L.P | Utilities | Bermuda 🇧🇲

A nice range bound breakout. I’d give it time to go lower in it’s own range.

FOX - Fox Corporation | Communication Services | USA

A very easy trend - the recent weakness I like personally. Keeps the price lower on

SWK - Stanley Black & Decker Inc | Industrials | USA 🇺🇸

This one is nice but I do see some weakness forming after all these highs. These moves will snap back.

AXP - American Express Co. | Financial | USA 🇺🇸

American Express is ready to continue to hit 52 highs. Nice sign for overall economy.

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DE - Deere & Co. | Industrials | USA 🇺🇸

This has been a consistent up trend since August.

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