From the desk of Willie Delwiche.

Key Takeaway: With last month’s rally behind us and the June lows quickly approaching, investor attitudes are beginning to sour. Bears on the II survey now outnumber bulls for the first time since mid-July, and the Consensus bulls continue to decline. Despite this pessimism, investors have been slow to take action. They have kept equity exposure elevated and equity ETFs actually saw $20B of inflows last week (after the two preceding weeks saw $11B of outflows). Increased pessimism at this point is the most significant sentiment risk for stocks. Investors (and their portfolios) have been bruised by a perceived lack of alternatives to stocks but with short-term bond yields now at their highest levels that could be changing.

Sentiment Report Chart of the Week: Safe Havens Haven’t Been Safe

Anything can happen over the final 3+ months of the year, but so far 2022 has been a disappointing year on many fronts for most investors. The portfolio drawdown experienced by the average...

We've adjusted a position in the Paid-to-Play portfolio today:

There's no denying our rather cautious approach to crypto markets as of late.

Bitcoin's hanging on by a thread. And the broader trend in risk markets has been lower, in a messy fashion.

So, given this backdrop, what's to be said about crypto-related equities?

Markets trade in cycles.

We've seen these cycles play out over and over again throughout many decades.

But how do we profit from it all?

Well, for me, I like to use seasonal tendencies to help put the current market environment into context.

It's not about today and tomorrow, and it's not about next year. Where are we right now?

Our Cycle Composite does a good job of helping us put together a road map for this market's cycle.

On the left side of this chart we have the 2021 seasonal trends and on the right we have the 2022 trends.

Last year's composite includes every year since 1950, every post election year since 1950 and every year ending in 1, to include the decennial cycle. Look how closely last year's actual results mirrored the composite:

The most significant insider activity on today's list comes in a Form 4 filing by Douglas A. Pepper, director of Braze Inc $BRZE.

Pepper reported a purchase worth roughly $14 million.

This is the video recording of the September 2022 Mid-month Conference Call.

We discussed:

• What's the Bear Case?
• One of worst starts to year for 60/40 portfolio in history
• The impact of the US Dollar on Stocks
• No lows list peaked 3 months ago
• Best time to buy stocks in the 4 year cycle
• Bearish sentiment persists
• ARKK and Biotech stopped falling in May
• S&P500 stuck below resistance 4100-4200
• European Banks show relative strength
• Midstream Stocks Breaking out - the full list
• Corn, Soybeans and Wheat with huge bases
• Silver bullish divergence vs Gold
• Other Emerging Markets outpacing China
• Small-cap Industrials stocks that are breaking out
• 1-yr yield highest roc in 40 years
• The Flippening Is Real
• List of best trade ideas

From the Desk of Ian Culley @IanCulley

The US Dollar Index $DXY is on cruise control with nothing ahead but an open road.

The few obstacles that stood in its way are falling to the wayside. That’s right – the handful of commodity currencies that have refused to roll over during the past six months are beginning to slip.

Before we get to these fresh breakdowns, let’s set the scene with two currencies that have been anything but resilient – the euro and the British pound.

From the desk of Willie Delwiche.

Key Takeaways:

• Inflation fight being waged on a global basis
• Rate expectations have been unanchored 
• Effects of tighter policy already being felt

Higher rates and tighter central banks are a global phenomenon this year. In fact, the Fed is one of a dozen central banks meeting this week and a majority are expected to raise rates, again. Both the breadth and intensity of rate hikes are pretty much unprecedented. That doesn’t even get into quantitative tightening in the US. The Fed’s balance sheet is 10-times as large as it was two decades ago and has only begun to shrink (the 26-week change just turned negative last month).

Expectations for the Fed are drifting higher. Futures have now priced in 100 basis points of tightening this year than the Fed thought would be necessary when it released its last dot plot (in June). Tomorrow’s updated economic projections and expected path of rates will receive at least as much scrutiny as an actual rate hike that gets announced. 

Stocks are struggling...

The next new position in our Paid-to-Play portfolio is:

Yesterday, we framed this market action in a rather dramatic tone, arguing that Bitcoin and cryptocurrencies are staring into the abyss.

With Bitcoin testing its year-to-date lows, there's little in the way preventing crypto assets from experiencing yet another significant leg down in the penultimate stages of this year.

So, alongside the commentary in yesterday's letter, we want to approach this market from two angles and let money flow dictate our execution.

Let's dive in.

The largest insider transaction on today's list is a Form 4 filing by the CEO of Ivanhoe Electric Inc $IE, who reported a purchase worth roughly $3.3 million.

The only 13G on our list today was filed by Boxer Capital, LLC. The investment firm revealed an initial 5.70% ownership stake in SpringWorks Therapeutics $SWTX.

The stock we're looking at this week is part of the Automobile sector.