Russell 2000 and S&P SmallCap have improved and are now considered as high-conviction long ideas.
•Upside potential is 15-20%.
•Our work suggests this period is similar to early 2012 and late 2005 when the market turned back up.
•Large Cap indices lag and do not yet show this same improvement. Although risk there is decreasing.
•US Homebuilders ETF (XHB): Improved to High Conviction Long.
•Wheat: Improved to High Conviction Long. Most attractive Commodity.
• Yield Curve Alert – followup: We stand by our May 8 Alert that the Yield Curve is Steepening. It is still timely to add to positions.