FINANCIAL ICEBERG
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MARKET INSIGHT
Dr Copper and  his funny friends disagree tremendously with SP500 level 
 Dec 2 ( Barchart, Investment Tools  )
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Dr Copper ( Right scale )
SP500 ( Left scale )​
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​​​In fact,  I mentioned already that Dr Copper was not trending the same way as the SP500... I decided to do an update because the SP500 has been making new highs lately...

​​In reality, I figured out that many of his friends were saying the same thing :
​SP500 is the only holding up , feel home alone !

​​It is very interesting to note the huge divergence between copper prices ( basic commodity economy driven ) compare to the SP500 ( liquidity driven by the FED ) ​( See charts below )




​Besides looking for trading opportunities, it is important to monitor the price action in commodities even if you only trade equities. In many cases, commodity volatility will occur immediately prior to equity volatility. 

So the real economy commodities ( copper, oil, coal, steel ) are not sending the same message as the super charged SP500.
It seems that the market is disconnect between the economy based commodities and real demand from the liquidity driven stocks...


​​​Even on a macro basis, we see the GSCI Index (S&P GSCI (formerly the Goldman Sachs Commodity Index)  contains a much higher exposure to energy than other commodity price indices such as the Dow Jones–AIG Commodity Index.( See graph below )
GSCI ( Right scale )
SP500 ( Left scale )​
And now crude oil ( WTI ) is not the exception, falling in prices lately because of political uncertainties fading ...
West Texas Intermediate ( Right scale )
SP500 ( Left scale )​
And now Coal...
Coal Prices ( Right scale )
SP500 ( Left scale )​
And the Mighty Steel Coil...
US Steel Coil Prices ( Right scale )
SP500 ( Left scale )​
iShares Real Estate Index IYR ( Right scale )
SP500 ( Left scale )​
And for those who think that commodities are the old economy, check the graph below and observe that the iShares Real Estate Index is underperforming the SP500... So interest rates sensitive sectors start to be under pressure...



Dr Copper and his funny friends disagree tremendously with SP500 level   $SPY, $SPX, $ES_F, $HG_F, $KOL, $IYR
So the real economy commodities ( copper, oil, coal, steel ) are not sending the same message as the super charged SP500.
​And even compare to the Mighty Baltic Dry Index ( as of November 29 at 1821, not updated on the monthly chart ), the same story apply. ( see graph below )
Baltic Dry Index ( Right scale )
SP500 ( Right scale )​