Still Quad 1-2 (Risk on!)

Get the bear market out of your head until we have a change in the tape!

Here is the call for next week: we have a Quad 1-2, a very healthy one!

The first time this feels like a real bull market comparable (a bit!) with the rally after covid hit:

CALF 0.00%↑ (Small caps with good cash flow) is almost at an all-time high, mid and small caps are “in play” right now!

Breadth is strong:

Very nice thrust, important, that it stays above 0! Such a thrust is not bearish, mid term very healthy.

(https://trendedge.app/indicators) —>

Strong:

Again, super nice thrust, which is mid term bullish!

Here are corresponding strategies / exposures to the Quads:

And here is the chart template you see above (left side) —> https://www.tc2000.com/~zJe9Iw

The key is to 1. look at the Quad and then 2. look for fitting exposures and long them only (!) if they are bullish trend (two strike rule!). Also look at the size (what is “in play”, small cap - mid cap or big caps!).

My small cap value momentum (with an earnings tilt) strategy book looks well, besides expected small pullbacks nothing to worry about (since above thrusts in breath point to longer term strength!):

AGAIN: if the tape (the Quads = network momentum) changes, I will change my opinion in a heartbeat and hedge, but my best guess is, this is a mid-term trend.

So, all in all, not much to do, I stay long about 90-100% (system book trimmed a bit, so no more leverage).

Also Quad 3 stuff is not strong, which leads to the conclusion that this Quad 1-2 trend should last —>

Same with Quad 4 exposures, besides TLT 0.00%↑ all bearish trend, why? Because relative of strength (red line) is pointing down:

Gee, this is getting boring, but it should not surprise us.

On 10.000 meter, we have huge tailwinds:

1. Liquidity (worldwide!) is up (have a look at Crossborder Capital) and most probably up in 2024-2025.

2. Inflation is down (Truflation.com)

3. #secularbullmarketUSA —>

If you want to have a full portfolio expression of the Quads have a look at https://twitter.com/howtoswingtrade —> no, I am not affiliated, I just love them and I think they are one of the best traders around.

And last but not least: do not follow me or anybody else blindly, get the framework and develop you own market timing and portfolio expression! It is worth the work.

All right, have a great weekend!

All the best and best regards.

Andreas

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