Monthly Asset Class Report

Stocks rally for the suckers; real estate and ETH up as well. Were you forwarded this email? [Sign-up to Rude Awakening here.]( [Unsubscribe]( [The Rude Awakening] Monthly Asset Class Report - Large caps rally hard for the suckers. - Real estate was up as well, but bonds took a bath. - Monero and Ether lead the way for cryptos. Recommended Link [This “Metaverse Mistake” Could Cost You A Fortune]( [Click here for more...]( Wired Magazine says it’s “arguably as big a shift as the telephone or the internet.” Which is why the biggest companies in the world are jumping in with both feet. Facebook. Apple. Microsoft. But I’m afraid most folks are making one simple mistake. And if you’re not careful, it could stop you from profiting off the biggest opportunity in the last generation. [Click Here To Learn More]( Sean Ring Editor, Rude Awakening Greetings from the Eternal City! I write you with sore feet under the desk, as we covered over 7 miles yesterday, according to my Apple Watch. I’ll tell you all about it this week, including a fascinating pub conversation with a professor from Oklahoma. But first things first. This past month, I’ve been moaning about the bear market rally in stocks. I think it’s finally going to turn back down. The SPX and Nasdaq both did well, but I genuinely think that’s because the US government, media, and perhaps even business, haven’t grasped the enormity of the Russian situation. Cryptos were up as I suspected, but not with the mustard I’d expect when governments confiscate assets left, right, and center. Monero, though, which is the only coin that’s genuinely anonymous, was up over 22% this month. I think that’s telling. The 10-year yield rose to 2.38%, putting the kibosh on bonds. I don’t like bonds right now and can’t see why you’d own them unless the government forced you to (like asset managers). But equally, I’m not sure how hard Powell can tighten without the markets crying “uncle.” This isn’t just a Paul Volcker situation; it’s a fundamental shift in how we price things. As the USD rallied over the last month, it’s not like investors are rushing for the exits. With that said, let’s get to the charts… S&P 500 From last month’s report: But I will say that as a death cross is imminent (50-day moving average moving below the 200-day MA), this market may have already put in its top. I should’ve realized that in Clown World, a death cross would be a buy signal instead of a screaming sell. So the SPX rallied about 400 points in the last two weeks of the month for a big sucker’s rally, which caught out many. But if last week represented the local high point, we’re in for an ugly April. Nasdaq Composite As they say in Asia, “Same, same, but different.” We had an enormous bear market rally last month, but like the SPX, I think Nazzie’s party is over for now. Russell 2000 (Small caps) The Russell has held steady to its great credit, but I stick to my $160 call. Small businesses can’t withstand Biden’s regulatory onslaught or poor policies for much longer. The US 10-Year Yield From last month’s report: I zoomed out a bit on this one for context. That little blue box shows a repudiation of the uptrend, but it’s only a little one. I expect the trend to resume in line with how hard the Fed goes into the hiking cycle. And there we went. We finished the month at 2.38%. I’m not sure how much farther Powell can go with tightening when the USG’s fiscal edifice starts to fall apart. Remember, for every 1% increase in rates, you add $300 million to the USG’s interest costs. Dollar Index From two months ago, but it nearly holds word-for-word: Ok, I’ve updated JC Paret’s chart on the USD here. Early in the month, we bounced off that 38% level of 94.80ish and rallied over the 50% line. I thought we’d be off to the races, but we traded back down immediately to 96.54. My best guess is that we’ll dilly dally around this level before rates go up and we take off from here. Next stop: 98.20, with an eye on the all-important psychological level of 100. We actually got up to 99.40 or so. Our problem now is wondering what the dollar can buy going forward and from whom. USG Bonds I said we’d hit 132, and so we have. We got all the way down to 128, but then another bear market rally happened. Fair enough. Now I’m looking at the 127 level, then 117 after that. Investment Grade Bonds From last month’s report: Though we had a rally in investment-grade bonds, I expect this to be short-lived. I’m looking at the 120 level from here. We got down to 118 before another bear market rally. There’s not much holding this up between here and 100. High Yield Bonds We got down below 80, but bounced off there. I’m still looking at that 77 level first. There’s nothing I like about junk right now. Real Estate I like this real estate rally, if only for the insane inflation argument. But since we’ve already had one false breakout recently, there’s nothing to guarantee this time is for real. Recommended Link [Have you heard George Gilder’s latest extraordinary prediction yet?]( [Click here for more...]( He was dubbed the “Tech Prophet” by Forbes… once won the White House Award for Entrepreneurial Excellence… and his work is respected by tech insiders like Bill Gates and former Google CEO Eric Schmidt… And recently, Gilder went on camera to explain how a new tech revolution is about to hit America… one that could unleash up to $15.1 trillion in new wealth. According to Gilder, if you don’t understand this new tech you could miss out on one of the greatest moneymaking opportunities for thirty five years. [Click Here For More Details]( Base Metals: Copper A false breakout early in the month gave hope, but hey, this isn’t nickel! We’re still in that red zone and just watching the price action until something definitive happens. Precious Metals: Gold Did Russia break the gold market wide open? I don’t know, but I think not owning gold right now is lunacy. The chart isn’t that exciting… yet. I’m still looking for that $150 rally before I get my gold bug on again. Precious Metals: Silver Watching this chart, I’m reminded of Bud Fox in Wall Street: “Having sex with her was like reading the Wall St Journal.” Yup, that’s silver for you. Cryptos: Bitcoin BTC is up, but not as much as I suspected. It couldn’t break its 200-day moving average, and that’s not a good sign. Cryptos: Ether ETH may be a real rally rather than a sucker’s one. It just retook its 200-day moving average, but the jury’s still out until it makes a new all-time high. Trad Asset Class Summary That commodities are up is no surprise, but we had one heck of a sucker’s rally in equities in March. Crypto Class Summary The descent was not only steadied last month but reversed. ETH had a great month, up 16%, while Monero, the most secretive coin, was up a stunning 22%. That’s not surprising, considering the West’s new policy of arbitrary confiscation. Wrap Up Thanks again for reading. It’s always a pleasure to see you here. I hate bonds, think stocks are still overcooked and wish gold would poop and get off the pot. But most of all, we will see how the Russian rubles-for-gas trade pans out. Much depends on how Europe reacts to Russia’s demand. Here, have some gallows humor: Until tomorrow. All the best, Sean Ring Editor, Rude Awakening To sign up for the Wiggin Sessions, [click here.]( By clicking this link, you will receive a free subscription to Wiggin Sessions and offers from us and our affiliates that we think might interest you. You can unsubscribe at any time. [Privacy Policy](. 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