The Storm Before The Calm… [DIRTY DOZEN]

“There is a time for all things, but I didn’t know it. And that is precisely what beats so many men in Wall Street who are very far from being in the main sucker class. There is the plain fool, who does the wrong thing at all times everywhere, but there is the Wall Street fool, who thinks he must trade all the time. ~ Jesse Livermore

Good morning!  

I’m out of the jungle though I’m still trying to plant my feet on the ground, tbh. I’m writing from a spot on the beach in Dominical, CR. Internet isn’t super fast here so having trouble accessing my BBG terminal, which is why we’ve got different styled charts this week. I have a lot of emails asking about my experience with Mother Aya. And just wanted to let y’all know that I will get back to you but it will probably be later this week as I have some catching up to do in the markets.

In this week’s Dirty Dozen [CHART PACK]  we look at the market shakeout that’s in progress and discuss why we have lower still to go. We then go through some monthly charts, check in on the Generals, the US dollar, oil, and a cheap new agey stock trading near historical support, plus more… 

  1. Here’s the summary of BofA’s most recent Flow Show report (w/ emphasis by me). 


  1. Looking at this chart I think two things (1) that’s a pretty incredible selloff in global debt considering the backdrop relative to similar instances of the past and (2) it’s going to be a very good time to buy bonds soon (next 1-3 months).


  1. I can’t decide if this is a chart crime or not but I include it here because it’s pretty with all of the annotations. Personally, I think the inflationary 70s are a poor comparison. We have a very different secular macro backdrop now.


  1. Here’s a cut of a report that went out to Collective members two weeks ago. We’re getting the shakeout now. How long or low this shakeout goes is anyone’s guess. I don’t care to predict but rather interpret the holistic picture as it happens. And as of now, we do not have indications of a washout bottom. So lower we go…


  1. April is over and we have new monthly prints in. The Qs monthly chart is not one you’d want to buy. April’s close near its lows, means its high odds we head lower in May.


  1. In war as in markets… The Generals tend to be the last to catch a bullet. And that’s what we’re seeing here. AMZN is not a chart you’d want to own. This looks like a cyclical topping pattern. 


  1. Same with General Google… 


  1. tHe uS doLlaR iS loSinG iTs gLobAL REseRvE cUrRencY STatuS bUY bItCOin… We are long DXY in the Collective and will add on technical setups. 


  1. Crude (looking at the Dec 22’ contract here) has formed an outside-inside (o-i) pattern. The monthly chart is in a clear uptrend but momentum has definitely slowed. Maybe we get further sideways consolidation, giving us a monthly o-i-i breakout pattern before another leg up, I don’t know. We’ll just have to watch and let the chart develop. 


  1. Interestingly, oil’s five consecutive monthly bull bars have historically led to poor follow-on returns. However, five consecutive monthly bull bars are rare and so this gives only gives us an N of 5. 


  1. USDCAD’s monthly chart needs to be on your radar for a long setup. Our Yield Differential Oscillator chart below shows yields moving in USDCAD’s favor (yield chart shows CADUSD). While our HUD matrix shows positioning and seasonality are strongly favorable to being long USDCAD.


  1. Not being super active in equities at the moment but one stock I plan on revisiting soon is the online streaming/media play Gaia Inc, GAIA. It’s back near major 20-year support while revenue and earnings continue to grow. The company has a strong balance sheet and I’m thinking all these ARKK bagholders will be seeking GAIA’s stress-relieving meditative programming in the months ahead.

Thanks for reading.

Stay frosty and keep your head on a swivel.

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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.