From the Desk of Ian Culley @IanCulley
It’s commodities over bonds.
In fact, we’re now in an everything-over-bonds environment as rates continue to rise.
Looking for an uptrend?
Just place US Treasury bonds or the Japanese yen in the denominator, and voila!
I consider the commodity-versus-bonds ratio one of if not the most important high-level intermarket ratio in our deck.
Why? Because it reveals the inflationary backdrop that colors the entire market, determining secular leadership between asset classes and US stocks.
And it’s hinting at the next trend in relative strength…