Founder & Chief Market Strategist - SAV Markets, SAV Markets

Shyam Devani

Founder & Chief Market Strategist - SAV Markets

Cross Asset Strategy

<p>While nominal bond yields rise, real yields across the US curve remain negative thus giving a sign that the USD is ready to weaken again and Gold to bounce back. In an environment of now rising equities this provides a more 'risk positive' environment in which Asian markets are likely to perform well after a shaky end to January. India in particular stands out from an equity index view point and possibly even a currency perspective.</p>

While nominal bond yields rise, real yields across the US curve remain negative thus giving a sign that the USD is ready to weaken again and Gold to bounce back. In an environment of now rising equities this provides a more 'risk positive' environment in which Asian markets are likely to perform well after a shaky end to January. India in particular stands out from an equity index view point and possibly even a currency perspective.

Managing Director

Elan Gore

TMI Data Science

TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade & traditional media.  Our proprietary software, TMI Machine, is a text-mining platform designed with the buy-side & capital markets professional in mind, text-mining the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income & individual equities.  TMI provides custom leading indicators and systematic trading strategies, operating at the nexus of linguistics & statistics drawing on vast experience in investment banking and hedge fund settings in senior quantitative and fundamental roles.  

TMI Data Science was founded by Elan Gore, an award-winning Senior Global Basic Materials Equity Analyst & China Economist with 15 years of experience in North American hedge funds & institutional managers; and Alessandro Porrino, Ph.D., an Algorithmic Trading Analyst and Programmer with 10 years of front-office experience ranging from complex FX option pricing to auto-hedging strategies at Bank of America Merrill Lynch and Standard Chartered.  Mr. Gore holds an MBA in Finance from New York University Stern School of Business, and Mr. Porrino holds a Ph.D. in Systems Engineering from Brunel University London.

<ul>
<li>In <a href="https://www.smartkarma.com/insights/tmi-snapshot-update-on-bitcoin-vs-gold-via-text-mining" target="_blank" data-smartkarma-citation="insights:46576" rel="noopener">TMI Snapshot:  Update on Bitcoin Vs. Gold Via Text Mining</a> we compared the trajectory of sentiment in articles discussing BTC as a "store of value" relative to similar mentions of gold; at the time, December 22, we saw a sharp divergence with BTC "store of value" sentiment at a new high of +2x STDEVs while gold was gathering significant negative momentum on the same topic</li>
<li>Trends have been mean-reverting since, with sentiment for BTC softer on the "store of value" question while gold continues to stabilize</li>
<li>The discussion of gold as an inflation hedge has made a notable comeback (volumetrically) after dropping sharply around the November elections; this has not affected the BTC inflation hedge narrative, which continues to trend despite recent volatility</li>
<li>Reports of BTC institutional adoption surged in November-December and are still trending albeit at a slower rate; but discussion of cryptocurrency regulation has surged in recent weeks to a new multi-year high</li>
<li>Mentions of BTC in conjunction with "bubble" are up 4-5x STDEVs since the second week of January</li>
<li>Based on the above signals, and in the context of the alleged "double-spend" headlines, the prevailing narrative of BTC competing with gold over the same AUM pool in a zero-sum game appears to be losing steam on the margin</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary tool text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


In TMI Snapshot:  Update on Bitcoin Vs. Gold Via Text Mining we compared the trajectory of sentiment in articles discussing BTC as a "store of value" relative to similar mentions of gold; at the time, December 22, we saw a sharp divergence with BTC "store of value" sentiment at a new high of +2x STDEVs while gold was gathering significant negative momentum on the same topic
Trends have been mean-reverting since, with sentiment for BTC softer on the "store of value" question while gold continues to stabilize
The discussion of gold as an inflation hedge has made a notable comeback (volumetrically) after dropping sharply around the November elections; this has not affected the BTC inflation hedge narrative, which continues to trend despite recent volatility
Reports of BTC institutional adoption surged in November-December and are still trending albeit at a slower rate; but discussion of cryptocurrency regulation has surged in recent weeks to a new multi-year high
Mentions of BTC in conjunction with "bubble" are up 4-5x STDEVs since the second week of January
Based on the above signals, and in the context of the alleged "double-spend" headlines, the prevailing narrative of BTC competing with gold over the same AUM pool in a zero-sum game appears to be losing steam on the margin
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary tool text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Snapshot:  Bitcoin Vs. Gold Update and Recent Crypto Topics Via Text Mining

<p>Are there fresh signs in markets that we are indeed going through a short-term wobble?</p>
<p>A close look at US yields and interest rate curves as well as the Gold price reveals that there is indeed some pain ahead before we settle into what is ultimately a bullish trend in equities.</p>

Are there fresh signs in markets that we are indeed going through a short-term wobble?
A close look at US yields and interest rate curves as well as the Gold price reveals that there is indeed some pain ahead before we settle into what is ultimately a bullish trend in equities.

Commodities

<ul>
<li>Last month our text-mined indicators highlighted a notable raw materials restocking underway for the second time since August; this theme did not slow down throughout December, ending the month at a new high</li>
<li>Though with very little discernible impact on commodities, our indicators saw Chinese macro sentiment peak earlier in December at +3x STDEV with some momentum lost on the margin since, driven by below-consensus Chinese retail sales and home price readings, continuing in recent days on lower-than-expected NBS and Caixin PMI releases</li>
<li>In the context of USD weakness, a wildly inflationary mindset in markets and a general restocking, commodity optimism has not wavered </li>
<li>Our commodity sentiment indicators saw broader momentum in December, with already-surging copper momentum joined by crude, aluminum, uranium and nickel; iron ore and steel may be coming off the boil, but markets remain extraordinarily tight</li>
<li>Gold sentiment appears to have fully stabilized after the post-election risk-on shock</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


Last month our text-mined indicators highlighted a notable raw materials restocking underway for the second time since August; this theme did not slow down throughout December, ending the month at a new high
Though with very little discernible impact on commodities, our indicators saw Chinese macro sentiment peak earlier in December at +3x STDEV with some momentum lost on the margin since, driven by below-consensus Chinese retail sales and home price readings, continuing in recent days on lower-than-expected NBS and Caixin PMI releases
In the context of USD weakness, a wildly inflationary mindset in markets and a general restocking, commodity optimism has not wavered 
Our commodity sentiment indicators saw broader momentum in December, with already-surging copper momentum joined by crude, aluminum, uranium and nickel; iron ore and steel may be coming off the boil, but markets remain extraordinarily tight
Gold sentiment appears to have fully stabilized after the post-election risk-on shock
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Indicators: Commodity Sentiment Review - Restocking On, But China Macro Momentum May Have Peaked

<ul>
<li>In last month's <a href="https://www.smartkarma.com/insights/tmi-snapshot-text-mining-the-thematics-behind-gold-s-disappointing-fall" target="_blank" data-smartkarma-citation="insights:45821" rel="noopener">TMI Snapshot: Text-Mining the Thematics Behind Gold's Disappointing Fall</a> we observed a sharp decline in mentions of gold as an inflation hedge relative to a dramatic increase in mentions of Bitcoin in the same context in the media</li>
<li>Given aggressive signaling of institutional BTC adoption since, we revisit the topic of BTC vs. gold across a few vectors in effort to characterize the state of relative sentiment </li>
<li>Sentiment on BTC as a store of value is up +2x STDEVs to its highest in nearly a year, while sentiment on gold as a store of value has fallen -1.6x STDEVs to levels last seen in April, with no signs of improvement yet; volumetrically, media discussion of BTC as a store of value hit an all-time high in November and continues to increase</li>
<li>Faint signs of gold stabilization are seen in the inflation discussion, where mentions of gold in the context of inflation saw negative momentum peak at -2x STDEVs in November but have been steadying since; BTC mentions in an inflation context continued to increase sharply</li>
<li>Mentions of BTC in the context of institutional adoption began to surge 3-4x STDEVs last month, and continue to increase at the same rapid pace</li>
<li>FOMO or not, extremely low institutional &amp; family office ownership of BTC vs. elevated gold ownership provide relative tailwinds for the cryptocurrency (absent material vol spikes) while gold positioning has only partially unwound</li>
<li>At least one noted strategist cites gold's underperformance of BTC as a reason to buy bullion here, but we have yet to see a significant catalyst</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


In last month's TMI Snapshot: Text-Mining the Thematics Behind Gold's Disappointing Fall we observed a sharp decline in mentions of gold as an inflation hedge relative to a dramatic increase in mentions of Bitcoin in the same context in the media
Given aggressive signaling of institutional BTC adoption since, we revisit the topic of BTC vs. gold across a few vectors in effort to characterize the state of relative sentiment 
Sentiment on BTC as a store of value is up +2x STDEVs to its highest in nearly a year, while sentiment on gold as a store of value has fallen -1.6x STDEVs to levels last seen in April, with no signs of improvement yet; volumetrically, media discussion of BTC as a store of value hit an all-time high in November and continues to increase
Faint signs of gold stabilization are seen in the inflation discussion, where mentions of gold in the context of inflation saw negative momentum peak at -2x STDEVs in November but have been steadying since; BTC mentions in an inflation context continued to increase sharply
Mentions of BTC in the context of institutional adoption began to surge 3-4x STDEVs last month, and continue to increase at the same rapid pace
FOMO or not, extremely low institutional &amp; family office ownership of BTC vs. elevated gold ownership provide relative tailwinds for the cryptocurrency (absent material vol spikes) while gold positioning has only partially unwound
At least one noted strategist cites gold's underperformance of BTC as a reason to buy bullion here, but we have yet to see a significant catalyst
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Snapshot:  Update on Bitcoin Vs. Gold Via Text Mining

United States

Gold is a chemical element with the symbol Au (from Latin: aurum) and the atomic number 79. In its purest form, it is a bright, slightly reddish yellow, dense, soft, malleable and ductile metal. Chemically, gold is a transition metal and a group 11 element. It is one of the least reactive chemical elements, and is solid under standard conditions. The metal therefore occurs often in free elemental (native) form, as nuggets or grains, in rocks, in veins and in alluvial deposits. It occurs in a solid solution series with the native element silver (as electrum) and also naturally alloyed with copper and palladium. Less commonly, it occurs in minerals as gold compounds, often with tellurium (gold tellurides).

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Gold (GOLD COMDTY)

Golden Opportunities

Negative real yields and rising equities indicate a weaker USD and a higher Gold price. In Asia India looks very interesting

Shyam Devani

TMI Snapshot: Bitcoin Vs. Gold Update and Recent Crypto Topics Via Text Mining

Last month our text-mining saw powerful narratives emerge around Bitcoin as an alternative to gold, but recent vol has weakened the BTC "store of...

Elan Gore

Bonds & Gold Ready for a Bounce

A bounce in Bonds and Gold could be seen as a short term warning sign for equities in this market - still a time for caution ahead of better...

Shyam Devani

TMI Indicators: Commodity Sentiment Review - Restocking On, But China Macro Momentum May Have Peaked

TMI's commodity sentiment indicators saw improved breadth in December as restocking continues to drive reflation; but China macro momentum may have...

Elan Gore

TMI Snapshot: Update on Bitcoin Vs. Gold Via Text Mining

We text-mine for clues on gold vs. Bitcoin as competing stores of value. The divergence in sentiment remains unrelenting, with only faint signs of...

Elan Gore

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