About

Ahead of the Curve provides analysis and insight into today's global financial markets. The latest news and views from global stock, bond, commodity, and FOREX markets are discussed. Rajveer Rawlin is a PhD and received his MBA in finance from the Cardiff Metropolitan University, Wales, UK. He is an avid market watcher, having followed capital markets in the US and India since 1993. His research interests include capital markets, banking, investment analysis, and portfolio management, and he has over 20 years of experience in the above areas, covering the US and Indian markets. He has several publications in the above areas. He currently teaches business and management students at CHRIST University. The views expressed here are his own and should not be construed as advice to buy or sell securities.

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Time Series Analysis with GRETL

This video shows key time-series analyses techniques such as ARIMA, Granger Causality, Co-integration, and VECM performed via GRETL. Key dia...

Monday, 31 March 2025

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning March 31

 

Asset Class

Weekly Level / Change

Implication for S & P 500

Implication for Nifty*

S & P 500

5581, -1.53%

Bearish

Bearish

Nifty

23519, 0.72%

Neutral **

Bullish

China Shanghai Index

3351, -0.40%

Neutral

Neutral

Gold

3127, 1.58%

Bullish

Bullish

WTIC Crude

69.36, 1.58%

Bullish

Bullish

Copper

5.15, 0.76%

Bullish

Bullish

CRB Index

307, 0.36%

Neutral

Neutral

Baltic Dry Index

1602, -2.50%

Bearish

Bearish

Euro

1.0827, 0.12%

Neutral

Neutral

Dollar/Yen

149.81, 0.33%

Neutral

Neutral

Dow Transports

14593, -0.11%

Neutral

Neutral

Corporate Bonds (ETF)

108.48, 0.75%

Neutral

Neutral

High Yield Bonds (ETF)

95.21, -0.57%

Bearish

Bearish

US 10-year Bond Yield

4.25%, 0.05%

Neutral

Neutral

NYSE Summation Index

-195, 4%

Bullish

Neutral

US Vix

21.65, 12.29%

Bearish

Neutral

S & P 500 Skew

139

Neutral

Neutral

CNN Fear & Greed Index

Extreme Fear

Bullish

Neutral

Nifty MMI Index

Extreme Greed

Neutral

Bearish

20 DMA, S & P 500

5688, Below

Bearish

Neutral

50 DMA, S & P 500

5900, Below

Bearish

Neutral

200 DMA, S & P 500

5759, Below

Bearish

Neutral

20 DMA, Nifty

22815, Above

Neutral

Bullish

50 DMA, Nifty

22999, Above

Neutral

Bullish

200 DMA, Nifty

24076, Below

Neutral

Bearish

S & P 500 P/E

27.80

Bearish

Neutral

Nifty P/E

21.37

Neutral

Bearish

India Vix

12.72, 1.13%

Neutral

Bearish

Dollar/Rupee

85.53, -0.53%

Neutral

Bullish

 

 

Overall

 

 

S & P 500

 

 

Nifty

 

Bullish Indications

5

7

Bearish Indications

8

7

 

Outlook

Bearish

Neutral

Observation

 

The S&P fell, and the Nifty rose last week. Indicators are bearish for the week.

Markets have topped. Watch those stops.

On the Horizon

US – Employment data, Eurozone – CPI

*Nifty

 

India’s Benchmark Stock Market Index

Raw Data

Data courtesy stockcharts.com, investing.com, multpl.com, nseindia.com, tickertape.in

**Neutral

Changes less than 0.5% are considered neutral

 


The S&P fell, and the Nifty rose last week. Indicators are bearish for the week. Markets have topped. We are transitioning from an inflationary regime to a deflationary one. The sentiment is extremely fearful. Carry trade liquidation may resume quickly, as the S & P is below the 200 DMA near 5760, which will likely act as resistance to this oversold bounce. The macro environment is rapidly deteriorating. The massive breakdown in transports is quite ominous. The Nifty has corrected significantly from recent highs and will likely underperform.

The past week saw US equity markets fall. Most emerging markets fell even as interest rates were little changed. Transports were unchanged. The Baltic dry fell. The dollar was unchanged. Commodities were also unchanged. Valuations are expensive, market breadth rebounded, and the sentiment is fearful. Fear (S&P 500) is back in vogue.

After this rally, a currency crisis should resume and push risky assets to new lows. Despite the recent inflationary spike, deflation is in the air, and bonds are telegraphing just that. It feels like a 2008-style recession trade has begun, with a potential for a decline in risk assets across the board. The current market is tracking closely the 2000 moves down in the S&P 500, implying a panic low right ahead in the upcoming months (My views do not matter; kindly pay attention to the levels). A dollar rally is a likely catalyst.

The S&P 500 is correcting from recent highs. We have bounced from recent lows without capitulation. This suggests the lows may not be in, and the regime has changed from buying the dip to selling the rip. We may get a final flush down soon. Risky assets should continue breaking to the downside as earnings growth falters. The Fed has aggressively tightened into a recession. Deflationary busts often begin after major inflationary scares. The Dollar, commodities, and bond yields are flashing significant warning signs.

Global yield curves have inverted a second time after the recent steepening, reflecting the arrival of a significant economic slowdownThis inversion following the recent steepening of the yield curve, after the first inversion, is a precursor to the next recession, and the riskiest assets will underperform going forward under such conditions. 

The critical levels to watch for the week are 5595 (up) and 5570 (down) on the S&P 500 and 23600 (up) and 23450 (down) on the Nifty. A significant breach of the above levels could trigger the next big move in the above markets.  High beta / P/E will get torched again and is a sell on every rise. Gold increasingly looks like the asset class to own over the next decade (short-term resistance at 3200). Gold exploded almost eight times higher over the decade following the dot-com bust in 2000. Imagine what would happen to gold as this AI bubble bursts. You can check out last week’s report for a comparison. I love your thoughts and feedback.

 

 

Tuesday, 25 March 2025

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning March 24

 

Asset Class

Weekly Level / Change

Implication for S & P 500

Implication for Nifty*

S & P 500

5668, 0.51%

Bullish

Bullish

Nifty

23350, 4.26%

Neutral **

Bullish

China Shanghai Index

3365, -1.60%

Bearish

Bearish

Gold

3048, 1.58%

Bullish

Bullish

WTIC Crude

67.89, 1.46%

Bullish

Bullish

Copper

5.11, 4.44%

Bullish

Bullish

CRB Index

306, 1.02%

Bullish

Bullish

Baltic Dry Index

1643, -1.56%

Bearish

Bearish

Euro

1.0814, -0.60%

Bearish

Bearish

Dollar/Yen

149.31, 0.45%

Neutral

Neutral

Dow Transports

14609, -0.24%

Neutral

Neutral

Corporate Bonds (ETF)

108.75, 0.75%

Bullish

Bullish

High Yield Bonds (ETF)

95.76, 0.45%

Neutral

Neutral

US 10-year Bond Yield

4.25%, -1.07%

Bullish

Bullish

NYSE Summation Index

-201, 26%

Bullish

Neutral

US Vix

19.28, -11.44%

Bullish

Neutral

S & P 500 Skew

142

Bearish

Neutral

CNN Fear & Greed Index

Extreme Fear

Bullish

Neutral

Nifty MMI Index

Extreme Greed

Neutral

Bearish

20 DMA, S & P 500

5747, Below

Bearish

Neutral

50 DMA, S & P 500

5917, Below

Bearish

Neutral

200 DMA, S & P 500

5750, Below

Bearish

Neutral

20 DMA, Nifty

22587, Above

Neutral

Bullish

50 DMA, Nifty

22969, Above

Neutral

Bullish

200 DMA, Nifty

24056, Below

Neutral

Bearish

S & P 500 P/E

28.23

Bearish

Neutral

Nifty P/E

20.76

Neutral

Bearish

India Vix

12.58, -5.23%

Neutral

Bullish

Dollar/Rupee

85.99, -0.46%

Neutral

Neutral

 

 

Overall

 

 

S & P 500

 

 

Nifty

 

Bullish Indications

9

11

Bearish Indications

8

6

 

Outlook

Bullish

Bullish

Observation

 

The S&P and the Nifty rose last week. Indicators are bullish for the week.

Markets have topped. Watch those stops.

On the Horizon

US – GDP, UK – CPI, GDP

*Nifty

 

India’s Benchmark Stock Market Index

Raw Data

Data courtesy stockcharts.com, investing.com, multpl.com, nseindia.com, tickertape.in

**Neutral

Changes less than 0.5% are considered neutral

 


The S&P and the Nifty rose last week. Indicators are bullish for the week. Markets have topped. We are transitioning from an inflationary regime to a deflationary one. The sentiment is extremely fearful. Carry trade liquidation may resume quickly, as the S & P is below the 200 DMA near 5750, which will likely act as resistance to this oversold bounce. The macro environment is rapidly deteriorating. The massive breakdown in transports is quite ominous. The Nifty has corrected significantly from recent highs and will likely underperform.

The past week saw US equity markets rise. Most emerging markets were unchanged even as interest rates fell. Transports were unchanged. The Baltic dry fell. The dollar rose. Commodities rose. Valuations are expensive, market breadth rebounded, and the sentiment is fearful. Fear (S&P 500) retreated.

After this rally, a currency crisis should resume and push risky assets to new lows. Despite the recent inflationary spike, deflation is in the air, and bonds are telegraphing just that. It feels like a 2008-style recession trade has begun, with a potential for a decline in risk assets across the board. The current market is tracking closely the 2000 moves down in the S&P 500, implying a panic low right ahead in the upcoming months (My views do not matter; kindly pay attention to the levels). A dollar rally is a likely catalyst.

The S&P 500 is correcting from recent highs. We have bounced from recent lows without capitulation. This suggests the lows may not be in, and the regime has changed from buying the dip to selling the rip. We may get a final flush down soon. Risky assets should continue breaking to the downside as earnings growth peaks. The Fed has aggressively tightened into a recession. Deflationary busts often begin after major inflationary scares. The Dollar, commodities, and bond yields are flashing significant warning signs.

Global yield curves have inverted a second time after the recent steepening, reflecting the arrival of a significant economic slowdownThis inversion following the recent steepening of the yield curve, after the first inversion, is a precursor to the next recession, and the riskiest assets will underperform going forward under such conditions. 

The critical levels to watch for the week are 5680 (up) and 5655 (down) on the S&P 500 and 23450 (up) and 23250 (down) on the Nifty. A significant breach of the above levels could trigger the next big move in the above markets.  High beta / P/E will get torched again and likely be a sell on every rise. Gold increasingly looks like the asset class to own over the next decade (short-term resistance at 3000). Gold exploded almost eight times higher over the decade following the dot-com bust in 2000. Imagine what would happen to gold as this AI bubble bursts. You can check out last week’s report for a comparison. I love your thoughts and feedback.

 

 

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My Asset Allocation Strategy (Indian Market)

Cash - 40%
Bonds - 20%
Fixed deposit - 20%
Gold - 5%
Stocks - 10% ( Majority of this in dividend funds)
Other Asset Classes - 5%

My belief is that stocks are relatively overvalued compared to bonds and attractive buying opportunities can come along after 1-2 years. In a deflationary scenario no asset class does well other than U.S bonds, the U.S dollar and the Japanese yen, so better to be safe than sorry with high quality government bonds and fixed deposits. Cash is the king always. Of course this varies with the person's age.