Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

Technical Analysis

US 10yr made a significant turn in yield with a dual low near our 1.13% undershoot target of 1.18%. This yield turn targets 1.50% resistance but above this level would unleash a much bigger move, siding with stronger inflation prints going forward.Above 1.50% would be a game changer and shift the trend in favor of new yield highs above March levels.Higher yields will provide fuel for the next USD rally phase to DXY 94, pressure EM and Asian FX and the equity cycle and favor banking sectors and linked assets that perform in a rising rate environment.

US 10yr made a significant turn in yield with a dual low near our 1.13% undershoot target of 1.18%. This yield turn targets 1.50% resistance but above this level would unleash a much bigger move, siding with stronger inflation prints going forward.Above 1.50% would be a game changer and shift the trend in favor of new yield highs above March levels.Higher yields will provide fuel for the next USD rally phase to DXY 94, pressure EM and Asian FX and the equity cycle and favor banking sectors and linked assets that perform in a rising rate environment.

Founder & Chief Market Strategist - SAV Markets, SAV Markets

Shyam Devani

Founder & Chief Market Strategist - SAV Markets

Cross Asset Strategy

Cross market developments over the past week point to real yields moving deeper into negative territory in the US. The combination of higher commodity prices, a break higher on breakevens and and anchored nominal yields will likely result in support for hard assets like Gold and Real Estate, both of which are looking more interesting

Cross market developments over the past week point to real yields moving deeper into negative territory in the US. The combination of higher commodity prices, a break higher on breakevens and and anchored nominal yields will likely result in support for hard assets like Gold and Real Estate, both of which are looking more interesting

Real Yields - Focus Again on Hard Assets?

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.

Macroeconomics

<ul>
<li>This year's narrative from US treasuries suggests a short-lived inflation/overheating scare in Q1, which coincided with Winter Storm Uri and the Texas power crisis, along with an initial phase of tapering talk from regional Fed presidents which subsequently faded; since the March peak, 10yr yields are down -45bps or a whopping -26%, representing the view that inflationary pressures have been entirely transitory</li>
<li>The picture from 5yr TIPS breakevens and the 5yr5yr has been more closely attuned to commodities:  In the past 6 months, 5yr TIPS breakevens and 5yr5yr have been 74% and 70% correlated with copper prices vs. the 10yr yield's 46%, though correlations with oil have been low; breakevens peaked with copper in May and bottomed in June-July</li>
<li>While 10yr yields continued to grind lower in July, our text mining is picking up a new surge in reports of supply constraints, which have been strongly correlated with breakevens and reflect corporate commentary in the current earnings season</li>
<li>The inflation narrative from treasuries appears to be asynchronous with the Q2 earnings season narrative from cyclical corporates, who are uniformly reporting worsening raw materials inflation expected in Q3 and lingering supply constraints</li>
<li>Nonetheless, our text mining acknowledges that talk of tightening financial conditions last spiked in March and has not resurfaced since, and expectations of a massive US infrastructure package have faded</li>
</ul><div class="content-highlight">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. </div>


This year's narrative from US treasuries suggests a short-lived inflation/overheating scare in Q1, which coincided with Winter Storm Uri and the Texas power crisis, along with an initial phase of tapering talk from regional Fed presidents which subsequently faded; since the March peak, 10yr yields are down -45bps or a whopping -26%, representing the view that inflationary pressures have been entirely transitory
The picture from 5yr TIPS breakevens and the 5yr5yr has been more closely attuned to commodities:  In the past 6 months, 5yr TIPS breakevens and 5yr5yr have been 74% and 70% correlated with copper prices vs. the 10yr yield's 46%, though correlations with oil have been low; breakevens peaked with copper in May and bottomed in June-July
While 10yr yields continued to grind lower in July, our text mining is picking up a new surge in reports of supply constraints, which have been strongly correlated with breakevens and reflect corporate commentary in the current earnings season
The inflation narrative from treasuries appears to be asynchronous with the Q2 earnings season narrative from cyclical corporates, who are uniformly reporting worsening raw materials inflation expected in Q3 and lingering supply constraints
Nonetheless, our text mining acknowledges that talk of tightening financial conditions last spiked in March and has not resurfaced since, and expectations of a massive US infrastructure package have faded
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:  Asynchronous Inflation Narratives

Developments over the past 24 hours have meant that US 10Y breakeven is now at its highest for more than a month. Importantly the level highlighted yesterday at 2.38% has given way. The setup now argues for a move to 2.55% - close to the trend highs seen in MayUnless nominal yields rise by more than 15bps, real yields are either going to stay unchanged at low levels or move even lower into negative territory, as they have started to do again todayAt the same time developments in China’s equity markets remain bearish which is now beginning to feed through to the currency.With Chinese and European authorities both on the dovish side, is this the time for the Fed to stay on the fence or be hawkish? Instead, could a dovish Fed provide the trigger for a weakening USD (perhaps ex USDCNH) and ultimately a rise in Gold?

Developments over the past 24 hours have meant that US 10Y breakeven is now at its highest for more than a month. Importantly the level highlighted yesterday at 2.38% has given way. The setup now argues for a move to 2.55% - close to the trend highs seen in MayUnless nominal yields rise by more than 15bps, real yields are either going to stay unchanged at low levels or move even lower into negative territory, as they have started to do again todayAt the same time developments in China’s equity markets remain bearish which is now beginning to feed through to the currency.With Chinese and European authorities both on the dovish side, is this the time for the Fed to stay on the fence or be hawkish? Instead, could a dovish Fed provide the trigger for a weakening USD (perhaps ex USDCNH) and ultimately a rise in Gold?

The developments taking place on Copper and the wider London Metals Exchange Index, indicate further gains from here in base metals. The corrections over the past couple of months seem to be over and we might even be ready to rally back to the trend highs.Should that unfold, it would only bring inflationary pressures back to the fore and help push breakevens higher, which has already started to happen.Combining that with the recent trouble in Chinese equities &amp; the low nominal yields has resulted in the lowest ever print on US 10 year real yield today.Unless one believes nominal yields are going to shoot up quickly (not a belief held here even if there seems to be little value in Bonds) then this picture should continue to provide a positive backdrop for precious metals and a negative one for the USD generally.

The developments taking place on Copper and the wider London Metals Exchange Index, indicate further gains from here in base metals. The corrections over the past couple of months seem to be over and we might even be ready to rally back to the trend highs.Should that unfold, it would only bring inflationary pressures back to the fore and help push breakevens higher, which has already started to happen.Combining that with the recent trouble in Chinese equities &amp; the low nominal yields has resulted in the lowest ever print on US 10 year real yield today.Unless one believes nominal yields are going to shoot up quickly (not a belief held here even if there seems to be little value in Bonds) then this picture should continue to provide a positive backdrop for precious metals and a negative one for the USD generally.

US 10Y (USGG10YR INDEX)

Bond Inflation Inflection

US 10yr made a significant turn in yield with a1.13% dual low. This yield turn targets 1.50%, above this would induce bigger move, siding with...

Thomas Schroeder

Real Yields - Focus Again on Hard Assets?

US real yields continue to look likely to move deeper into negative territory allowing Gold and real estate to perform well

Shyam Devani

TMI Snapshot: Asynchronous Inflation Narratives

While the bond market continues to dismiss inflationary pressures, our text mining picked up a recent spike in mentions of supply constraints as...

Elan Gore

Bonds & FX: Here Comes Trouble

US real yields are likely to remain at trend lows or move even deeper into negative territory. With China and Europe both dovish, is the Fed going...

Shyam Devani

Bonds & Commodities - An Interesting Mix

Higher Base metals bring inflationary concerns. When combined with low nominal yields we are now at the lowest level on US 10Y real yield which...

Shyam Devani