Last week our short-term US behavioral indicators signaled a down week last week. The S&P 500 was slightly down for the week. Given the week was slightly down instead of down big, our short-term US behavioral indicators have improved indicating to close the US hedge.
Our agent-based indicators still indicate the US is 18% under valued. However, the long-term behavioral indicator or sentiment is still bearish. The fixed income sentiment is still very bullish. We believe that there could be a bubble in fixed income since we have not seen such bullishness last for such a long time. Even though, we do not see signs of the bubble bursting anytime soon.
Our long-term plays currently are India, Korea, and Malaysia. In addition, we like fixed income markets in Emerging markets and the United States.
Our indicators indicate a relatively mild week of volatility.
Sunday, August 22, 2010
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