The Helsinki Indicator
Click on Charts to Zoom in
With household names like Cargotec, Amer Sports, Stora Enso, Valmet and Wärtsilä, how can we not be following the Helsinki 25 Index?
This sarcastic comment is written to point out how this is a correlation game. This is a money flow game. This is a risk appetite game. And Finland tells the story about what stocks are doing around the world better than most, even though these stocks have nothing to do with Apple, Amazon, Google or Berkshire Hathaway.
So this is what we want to watch: The Helsinki 25 Index:
Finland peaked in 2015 right around 3600, just as stocks globally were also putting in major tops. Then, just as stocks around the world bottomed in Q1 2016, so did Finland, as they proceeded to rally in unison for the next 2 years and into 2018. That's when a lot of stocks around the world also stopped going up. Earlier this year, many indexes confirmed nasty failed breakouts and stocks collapsed, Finland included.
So now the Helsinki 25 Index is back to the scene of the crime, if you will. These are those former highs from 2015, that turned into support at the end of 2018, before last year's epic rally.
Finland's ability to remain above 3600 would be an incredible signal of risk appetite for equities globally. Its inability to do so, however, would indicate that the sellers are still in control here, there is an overwhelming amount of supply relative to demand, and buying stocks, is therefore, not the best of ideas.
This is the Helsinki Indicator.
JC
NOTE: This Monday Night @ 7PM is our Live Monthly Conference Call for Premium Members. You can register here if you haven't already!