Buy Signals Triggering in China

“The most effective and functional trading belief that he can acquire is “anything can happen.” Aside from the fact that it is the truth, it will act as a solid foundation for building every other belief and attitude that he needs to be a successful trader.” ~ Mark Douglas

Good morning!

In this week’s Dirty Dozen [CHART PACK]  we look at Europe with a 21-year breakout, airlines in a bull trend, buy signals in tech, consolidated positioning nearing a zenith, soybeans at an inflection, the peso (MXN) going into elections, and monthly stock charts with great setups, plus more…

Let’s dive in.

***click charts to enlarge***

  1. Ari Wald, a seasoned technical analyst at Oppenheimer, shared some great charts on Bloomberg this past week. Here’s the SPX on top and RTY below. Both are coiled tight and ready for a run higher.


  1. Europe’s stock market just broke out of a 21-year sideways consolidation.


  1. This final one from Ari shows Airline stocks stair-stepping higher. We’ll see how long this trend will last if oil breaks out higher (which I expect it will).


  1. @MacroCharts tweeted about the recent underlying strength in growth stocks, writing “Important strength in Growth Stocks: One-third of Nasdaq Stocks have triggered Buy signals – the most since March 2020. Most spikes of this magnitude led to bottoms or *big* rally extensions. A textbook Bull Market response after a sentiment capitulation – follow the Trend.”


  1. I’m bullish over the very short-term but believe we’re nearer the end than the middle of this leg of the bull rally. One more leg up should be enough to get players over their skis…


  1. USDJPY is trading in one of its tightest two-month ranges in 50-years. Compression regimes lead to expansionary ones (big trends).


  1. A few weeks ago we talked about the near-record high aggregate speculative positioning in Ags. A number of these charts are starting to pull back from extended levels. Soybeans recently crossed above 2.5 on its weekly SQN. There have been 5 instances over the prior 60+ years and 4 of them led to lower prices a few months later.


  1. China’s been seeing a pickup in flows and these inflows are leading to a rise in MACD buy signals within the SHCOMP. The chart is bullish and the long-term trend is up.


  1. The Mexican peso is coiled and setting the stage for a break higher. Barclays notes that the peso has been trading weak into the coming election, which is typical, but a relief rally should follow after the vote.


  1. I’ve shared this one before but figured it’s time for an update since it’s starting to run.

Trilogy Metals (TMQ) is a mining company with a large interest in copper, zinc, lead, and gold/silver projects in Alaska. The stock is breaking out of a 7-year cup-n-handle (chart below is a monthly). Seth Klarman’s Baupost Group is one of its largest investors.


  1. Babcock & Wilcox Enterprises (BW) is a company focused on renewable energy solutions with a great monthly chart and lots of insider buying over the last year. I’ll be digging into this one over the coming week.


  1. GSM produces advanced metallurgical products. The stock has been on a tear over the last 6-months and looks to be gearing up for another run. We haven’t yet done DD on the company but it’s on our short-list to dig into.


Stay safe out there and keep your head on a swivel.

Subscribe To Our Newsletter

Brandon Beylo

Value Investor

Brandon has been a professional investor focusing on value for over 13 years, spending his time in small to micro-cap companies, spin-offs, SPACs, and deep value liquidation situations. Over time, he’s developed a deeper understanding for what deep-value investing actually means, and refined his philosophy to include any business trading at a wild discount to what he thinks its worth in 3-5 years.

Brandon has a tenacious passion for investing, broad-based learning, and business. He previously worked for several leading investment firms before joining the team at Macro Ops. He lives by the famous Munger mantra of trying to get a little smarter each day.


Investing & Personal Finance

AK is the founder of Macro Ops and the host of Fallible.

He started out in corporate economics for a Fortune 50 company before moving to a long/short equity investment firm.

With Macro Ops focused primarily on institutional clients, AK moved to servicing new investors just starting their journey. He takes the professional research and education produced at Macro Ops and breaks it down for beginners. The goal is to help clients find the best solution for their investing needs through effective education.

Tyler Kling

Volatility & Options Trader

Former trade desk manager at $100+ million family office where he oversaw multiple traders and helped develop cutting edge quantitative strategies in the derivatives market.

He worked as a consultant to the family office’s in-house fund of funds in the areas of portfolio manager evaluation and capital allocation.

Certified in Quantitative Finance from the Fitch Learning Center in London, England where he studied under famous quants such as Paul Wilmott.

Alex Barrow

Macro Trader

Founder and head macro trader at Macro Ops. Alex joined the US Marine Corps on his 18th birthday just one month after the 9/11 terrorist attacks. He subsequently spent a decade in the military. Serving in various capacities from scout sniper to interrogator and counterintelligence specialist. Following his military service, he worked as a contract intelligence professional for a number of US agencies (from the DIA to FBI) with a focus on counterintelligence and terrorist financing. He also spent time consulting for a tech company that specialized in building analytic software for finance and intelligence analysis.

After leaving the field of intelligence he went to work at a global macro hedge fund. He’s been professionally involved in markets since 2005, has consulted with a number of the leading names in the hedge fund space, and now manages his own family office while running Macro Ops. He’s published over 300 white papers on complex financial and macroeconomic topics, writes regularly about investment/market trends, and frequently speaks at conferences on trading and investing.

Macro Ops is a market research firm geared toward professional and experienced retail traders and investors. Macro Ops’ research has been featured in Forbes, Marketwatch, Business Insider, and Real Vision as well as a number of other leading publications.

You can find out more about Alex on his LinkedIn account here and also find him on Twitter where he frequently shares his market research.