#95: Hi-Yo Silver

Is it just me, or can you see the Golden Arches? They call this the Big Mac effect. I made that up. I have no idea what this means, but I think the other stores of wealth may be able to shed some light.

Gold has broken out of this triangle and has more upside potential.

Silver is a similar story to gold and is already up more than 29% YTD.

So for me, if central banks are going to start cutting rates any time soon, then we are going to continue to see the eroding of the purchasing power of money through inflation. These 3 stores of wealth are likely to continue on their upward trajectory.

The chart below shows the various SP500 sector YTD returns.

I think the S&P 500 Equal Weight index versus the S&P 500 Market Cap (Classic) index is telling us important information. Firstly, over long periods of time, there is performance drift in favour of the equal weighted index. Usually, at the tail end of major bull markets, the market cap index outperforms the equal-weighted index (see red eclipses below). I foresee the equal-weighted index trending up again in the near future.

The chart below shows the number of S&P 500 constituents in the index above their 50-day moving average diverging down while the index makes new all-time highs. This shows a weakening in market breadth, which adds to my thesis above, where I forecast the ratio of equal index to market cap will change course soon.

Tesla seems to be having a resurrection of religious proportions this month (+24.51%). It is still -0.84% down for the year. The new EV (electric vehicle) religion is certainly not a cult. Tesla, however, remains to be seen.

The post #95: Hi-Yo Silver appeared first on Signal2Noise.