Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

Key Points:<ul>
<li>The Staples Sector is leadership and many names are staging price and RS reversals.</li>
<li>REIT’s are breaking above bases and are showing RS leadership.</li>
<li>Paper &amp; Forest products are strengthening and many are reversing price and RS downtrend or breaking above bases.</li>
<li>Large-Cap Pharma stocks are showing leadership. Many have broken topside of multi-year consolidations or have reversed multi-year price and RS downtrends.</li>
</ul><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/059/921/original/Untitled.png?1533586859" class="editor-image img-responsive" data-smartkarma-image-id="59921"></figure>

Key Points:
The Staples Sector is leadership and many names are staging price and RS reversals.
REIT’s are breaking above bases and are showing RS leadership.
Paper &amp; Forest products are strengthening and many are reversing price and RS downtrend or breaking above bases.
Large-Cap Pharma stocks are showing leadership. Many have broken topside of multi-year consolidations or have reversed multi-year price and RS downtrends.


Managing Director, MTS Research

Peter Beuttell

Managing Director

MTS Research

MTS Research Limited is an independent investment research company specialising in technical analysis. 

MTS Research provides technical analysis services in the form of regular publications and consultancy advice, catering for a number of different investment approaches from absolute or relative returns to long-only and long/short.  The company has a global client base of blue-chip financial institutions ranging in size and stretching from Los Angeles to Tokyo, via New York, London, Frankfurt and Hong Kong.  

MTS was founded in 1989 at the request of Morgan Grenfell Investment Services Limited (MGIS), the ERISA arm of Morgan Grenfell Asset Management (subsequently Deutsche Asset Management), by Peter Beuttell, a Portfolio Manager at MGIS between 1987 and 1989. 

Peter is a qualified Chartered Accountant and self-taught market technician with over 30 years experience.  At MGIS, Peter managed money in European, Australasian and Far East markets for US clients, such as American Airlines and American Petrofina.  He achieved first quartile perfomance on their behalf by blending fundamental and technical analysis in his investment decision-making.  

After an initial focus on the EAFE markets (Europe, Australasia and Far East), the company has recently expanded its coverage to include the Americas, thanks to the recently-completed two-year Knowledge Transfer Partnership with the University of Plymouth.  The resulting software – the Technical Overlay Program (TOP) – allows fund managers to access an immediate Technical view on any market, sector, stock, bond yield, currency or commodity within their selected universe.

MTS Research consists of a team of five based in Penzance and London. 

The final rally of this bull market is under way.  That has been signalled by the appearance of the three-month Triangle in the S&amp;P 500, and its recent break up through 2,718.  Its final target range is 2,872-3,148.  The lack of new index extremes over the past month mean that there are no new indicator signals of note, but the likelihood of new highs is at least consistent with our case that the Q1 extreme momentum marked the end of a buying climax.  The extreme Trend Strength readings at the time suggested we were seeing a mirror image of 2008, and an “upward crash”.  Just as the extreme momentum of 2008 was a precursor to new lows in 2009, so new highs would be normal now.  We remain at Hold, and traders could even buy on a dip to 2,645-2,655, but 2,585 closing is now the stop on that view.  Below there we would turn extremely bearish, looking for an extended decline to the 2016 low at 1,810 into 2019/2020.  Hopefully, we will get to make that call higher up.

The final rally of this bull market is under way.  That has been signalled by the appearance of the three-month Triangle in the S&amp;P 500, and its recent break up through 2,718.  Its final target range is 2,872-3,148.  The lack of new index extremes over the past month mean that there are no new indicator signals of note, but the likelihood of new highs is at least consistent with our case that the Q1 extreme momentum marked the end of a buying climax.  The extreme Trend Strength readings at the time suggested we were seeing a mirror image of 2008, and an “upward crash”.  Just as the extreme momentum of 2008 was a precursor to new lows in 2009, so new highs would be normal now.  We remain at Hold, and traders could even buy on a dip to 2,645-2,655, but 2,585 closing is now the stop on that view.  Below there we would turn extremely bearish, looking for an extended decline to the 2016 low at 1,810 into 2019/2020.  Hopefully, we will get to make that call higher up.

S&P 500:  Heading for a Final High at 2,872-3,148

The abrupt correction has led the DJIA and S&amp;P 500 to return to levels that are still well above their respective 200-day moving averages. In the case of the S&amp;P 500, Monday’s low is approaching its trendline which began with the lows of early 2016, also touching support the day before the presidential election of November 2016, and again in August 2017. A move below this area of support and the 200-day moving average could lead to further pressure and a potential return to the up-trend that began at the 2009 lows.  In this report we highlight key indicators to watch for signs of a near-term bottom, or for signs of further selling ahead.

The abrupt correction has led the DJIA and S&amp;P 500 to return to levels that are still well above their respective 200-day moving averages. In the case of the S&amp;P 500, Monday’s low is approaching its trendline which began with the lows of early 2016, also touching support the day before the presidential election of November 2016, and again in August 2017. A move below this area of support and the 200-day moving average could lead to further pressure and a potential return to the up-trend that began at the 2009 lows.  In this report we highlight key indicators to watch for signs of a near-term bottom, or for signs of further selling ahead.

U.S. Equity Strategy: Correcting Excess Optimism

In our November Macro Vision report, we provide an appraisal and recommendations for each of our 12 Sectors, with extra attention devoted to opportunities within the following areas: <ul><li>Energy:Market Weight.  Energy has shown a significant improvement over the last several months. A majority of the E&amp;P’s are breaking topside of their respective 200-day moving averages. A number of offshore drillers, which have lagged significantly over the last several years are reversing long-term downtrends and breaking above their respective 200-day moving averages.  </li></ul><ul><li>Financials: Overweight. Financials continue to demonstrate long-term leadership characteristics, with many breaking out to new highs or break above major bases.  </li></ul><ul><li>Technology: Overweight. Technology continues to reign in terms of leadership. The bases in this Sector are enormous, dating back to the 2000 bubble, and we believe that the upside potential after many years of consolidation is significant.  </li></ul><ul><li>Manufacturing: Overweight.  The main stalwart of strength had been within the confines of the aerospace industry, however automobile, truck, and construction equipment have garnered much of the attention over the last few months. We believe this is a positive sign for the economy.</li></ul>

In our November Macro Vision report, we provide an appraisal and recommendations for each of our 12 Sectors, with extra attention devoted to opportunities within the following areas: Energy:Market Weight.  Energy has shown a significant improvement over the last several months. A majority of the E&amp;P’s are breaking topside of their respective 200-day moving averages. A number of offshore drillers, which have lagged significantly over the last several years are reversing long-term downtrends and breaking above their respective 200-day moving averages.  Financials: Overweight. Financials continue to demonstrate long-term leadership characteristics, with many breaking out to new highs or break above major bases.  Technology: Overweight. Technology continues to reign in terms of leadership. The bases in this Sector are enormous, dating back to the 2000 bubble, and we believe that the upside potential after many years of consolidation is significant.  Manufacturing: Overweight.  The main stalwart of strength had been within the confines of the aerospace industry, however automobile, truck, and construction equipment have garnered much of the attention over the last few months. We believe this is a positive sign for the economy.

U.S. Equity Strategy & Individual Sector Commentaries

Our last strategy “Fake Moves” highlighted our view that the markets were showing no parallel to the “fake news” narrative and indeed provided a significant backdrop for a continued move higher. Breadth continues to support the move to new highs in the market and, in the case of Sector orientation, growth continues to indicate leadership. In this report we outline the market characteristics supporting our continued bullish outlook and give special attention to the following sectors: <ul><li> Energy: Market Weight. We are upgrading this Sector to a market weight as many stocks are experiencing positive inflections; however we do not yet believe this is a long-term RS performance leader.</li></ul> <ul><li> Health Care: Overweight. We upgraded this sector to an overweight on 06/27 as biotechs staged a price and RS reversal and broke above a significant resistance level.</li></ul> <ul><li> Technology: Overweight. Tech continues to demonstrate its long-term leadership status. Major bases on the long-term charts reflects years of consolidations and enormous upside potential.</li></ul>

Our last strategy “Fake Moves” highlighted our view that the markets were showing no parallel to the “fake news” narrative and indeed provided a significant backdrop for a continued move higher. Breadth continues to support the move to new highs in the market and, in the case of Sector orientation, growth continues to indicate leadership. In this report we outline the market characteristics supporting our continued bullish outlook and give special attention to the following sectors:  Energy: Market Weight. We are upgrading this Sector to a market weight as many stocks are experiencing positive inflections; however we do not yet believe this is a long-term RS performance leader.  Health Care: Overweight. We upgraded this sector to an overweight on 06/27 as biotechs staged a price and RS reversal and broke above a significant resistance level.  Technology: Overweight. Tech continues to demonstrate its long-term leadership status. Major bases on the long-term charts reflects years of consolidations and enormous upside potential.

Vermilion Macro Vision - U.S. Equity Strategy: Sector Commentaries with Recommendations

United States

The Russell 2000 Index is comprised of the smallest 2000 companies in the Russell 3000 Index, representing approximately 8% of the Russell 3000 total market capitalization. The index was developed with a base value of 135.00 as of December 31, 1986.

Russell 2000 Index (RTY INDEX)

U.S. Vital Signs: Actionable Stocks

Key Points: The Staples Sector is leadership and many names are staging price and RS reversals. REIT’s are breaking above bases and are showing RS...

Vermilion Research

S&P 500: Heading for a Final High at 2,872-3,148

The final rally of this bull market is under way. That has been signalled by the appearance of the three-month Triangle in the S&P 500, and...

Peter Beuttell

U.S. Equity Strategy: Correcting Excess Optimism

The abrupt correction has led the DJIA and S&P 500 to return to levels that are still well above their respective 200-day moving averages. In...

Vermilion Research

U.S. Equity Strategy & Individual Sector Commentaries

In our November Macro Vision report, we provide an appraisal and recommendations for each of our 12 Sectors, with extra attention devoted...

Vermilion Research

Vermilion Macro Vision - U.S. Equity Strategy: Sector Commentaries with Recommendations

Our last strategy “Fake Moves” highlighted our view that the markets were showing no parallel to the “fake news” narrative and indeed provided a...

Vermilion Research