From the desk of Tom Bruni @BruniCharting
In June we outlined that the “Reflation Trade” indicators we track had picked up significantly after reaching levels of long-term support in March.
Since then that thesis has played out and we’ve been taking advantage of it in Metals, cyclical stock market sectors like Materials and Industrials, and even Agricultural Commodities which managed to break out.
But…after a nice run many of these assets and intermarket relationships have pulled back over the last month or so…begging the question “is the reflation thesis over?”
Luckily for us, we only need one chart to discuss what’s happening and how we’re approaching it.