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Intel: The 15+ Year Breakout

Uncategorized Dec 06, 2017
Arun S. Chopra CFA CMT
December 2017
  • Intel recently broke out of a large multi-year base.
  • There's a lot of concern over another 90s market, or a 2008-type event again.
  • A quick glance at earnings yield measures shows three very different markets.

I recently wrote a bit about the differences between the 90s and now in my article 'The 90s Called'. In it I discussed the 4 prior major tops ('29, '74, '00, '07) and the 4 key indicators I follow to warn of a potential top. The equity risk premium is a very common measure of overall valuation and one that I continue to monitor. Generally, we see the ERP go negative in the euphoria phase of a bull. A good argument can be had with respect to if we will see a euphoria phase this time around, but that's outside the scope of this article. What I wanted to do was look at the current market, Intel (NASDAQ:INTC), and how this type of analysis is driving my latest 'Fusion Strategy'.

Below is a chart of the earnings yield on the SPX vs. the...

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Macro Correlations

Arun S. Chopra CFA CMT
September 2017
  • Macro correlations are an area of particular interest. The more important ones happen in currencies, interest rates, and commodities.
  • A look at how long-term technical patterns can key us to macro shifts.
  • An in-depth look at the yen's influence in this and past cycles.
  • A look at a current scenario.

Macro correlations have been a particular interest of mine for a long time. This includes common concepts of intermarket analysis to some of the more unique relationships that can come and do often go.

Although many claim that today's managed atmosphere has rendered a lot of these relationships useless, I beg to differ. Markets move in trends, and when large trends change, asset class relationships will change as well, creating durable opportunities. Some are easily explained by economics, others simply are what they are, market phenomenona.

Some are likely happenstance and spurious at best, but by using longer-term technical analysis, some...

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I Am Shocked, SHOCKED, To Find Gambling Is Going On Here...

Uncategorized May 17, 2017
Arun S. Chopra CFA CMT
May 2017
  • SNAP and TWLO surprise fad stock chasers again.
  • This is nothing new something we've seen all cycle long.
  • A look at value vs valuation, lose-lose stocks, and mass media psychology.

This past few weeks we've seen some impressive 'misses' and subsequent stock declines. I often get asked about these 'fad' stocks, so I thought I'd put some of my past thoughts down.

Snap (NYSE:SNAP) and Twilio (NYSE:TWLO) have quickly put the game of ridicule, bubbles, and the associated denial back in full focus. Every time these events happen the market seems to shift between an 'told you so it's a bubble' narrative vs. 'this is part of the long term process of how growth stocks work' rationalization. But are either right? I'd argue not necessarily (certainly not the latter), but rather a process we see of 'valuation, investing, and overall gambling' that just confirms the nature of fad stock chasers. These common mistakes likely happen more in bullish/bubble...

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The VIX Hits 9, So What?

Uncategorized May 03, 2017
Arun S. Chopra CFA CMT
May 2017
  • The VIX traded below 10 this week.
  • Many have used this as evidence of an impending top.
  • Historical data shows two past examples, with entirely different outcomes.

With the Vix hitting 9 there's been a lot of charts showing this reduced level of activity, most centering around the idea of this being a massively bearish event. While there is no debate that low volatility readings indicate a reduced level of fear and complacent behavior, this needs to be put in context. I have already written a few articles here focusing on what I will be watching in this overall bull market to help guide any longer term topping process. Today's piece is simply to put this weeks '9' reading in context. Breaking a round figure like 10 sounds great, but lets look back at the last two instances. You can see below it's entirely inconclusive.

Chart 1: SPX with VIX 1986-2017

But let's take a look under the hood of each to see if we can get any further info (spoiler...

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