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 and Quantitative Research

Pullback Continues $ACWI; Stick With Defensives; More Countries With Improving Price and RS Trends

Downgrading Outlook on $SPX; Upgrading Real Estate and Staples. Many Significant Risk-Off Signals

Downgrading Japan; Stay Defensive; Downgrading Outlook on Global Equities $ACWI to Neutral

Monitoring Small- Vs. Large-Caps and Growth Vs. Value; $SPX, $QQQ in Pullback Mode

Pullback Underway; Getting Defensive; Long-Term RS Bottoms for Defensives Is a Reason for Caution

Rotation Continues; Bullish Outlook Intact; Buys in Global Financials, Industrials, Discretionary

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical Analysis

<ul>
<li>Breadth continues to improve and Russell 2000 (IWM) small-caps and the Dow remain bullish, all while the S&amp;P 500 and Nasdaq 100 (QQQ) are going through a pullback/consolidation phase.</li>
<li>Considering the Russell 2000 vs. S&amp;P 500 ratio is reversing a 3.5-year downtrend, we expect this trend of small-cap outperformance to continue for months or longer.</li>
<li>With new risk-off signals emerging, potential pullback zones we would look for include 5100-5191 on the S&amp;P 500 and $443-$449 on the QQQ, expecting a low near the election.</li>
</ul>


Breadth continues to improve and Russell 2000 (IWM) small-caps and the Dow remain bullish, all while the S&amp;P 500 and Nasdaq 100 (QQQ) are going through a pullback/consolidation phase.
Considering the Russell 2000 vs. S&amp;P 500 ratio is reversing a 3.5-year downtrend, we expect this trend of small-cap outperformance to continue for months or longer.
With new risk-off signals emerging, potential pullback zones we would look for include 5100-5191 on the S&amp;P 500 and $443-$449 on the QQQ, expecting a low near the election.


Universal Technical Institute, Inc (UTI US)

Dow Jones Industrial Average (INDU INDEX)

Consumer Staples Select Sector SPDR Fund (XLP US)

Upgrading Health Care to Market Weight; Risk-Off Signals Suggest SPX and QQQ Pullback to Continue

UnitedHealth Group

Upgrading Health Care to Market Weight; Risk-Off Signals Suggest SPX and QQQ Pullback to Continue