Vermilion ETF Pathfinder: Actionable ETF research & Ideas
Nasdaq 100 Breaking Out -- Buy; Bullish Outlook IntactAs discussed throughout the first half of January, and reiterated in our 2/3/25 ETF Pathfinder, we continue to believe that tariffs will mostly be used as a negotiation tactic, and much like Trump's prior presidency, will be much less impactful than feared. We also discussed our non-concern as it related to the Canada/Mexico tariff situation, calling the pullback a buying opportunity. Now, we are seeing signs that this 2+ month consolidation in the S&P 500 and Nasdaq 100 (QQQ) is ready to break out to the upside. Considering market dynamics remain risk-on, our outlook remains bullish as long as the S&P 500 remains above 5850 and 5600-5670. We expect a breakout above 6100 on the S&P 500 (testing now), and we are already seeing a breakout on the QQQ -- buy.
Market Dynamics Remain Risk-On. Aside from the 2-month breakout on QQQ, two other crucial bullish developments include further evidence that the U.S. dollar (DXY) and 10-Year Treasury Yield have formed major topping patterns as they break below $107 and 4.5%. Since mid-January, we always said we believed these were local tops at minimum, with potential to be major tops, and it appears as though the latter is true. Of course, this is on top of the many other market dynamics which remain risk-on (high yield spreads at 17-year narrows, crude oil and gas prices remain in downtrends, cyclical/growth Sectors outperforming while defensives underperform, low interest rate volatility, Europe, China, MSCI EM, and EAFE breaking out, bitcoin remains bullish, Fear & Greed Index is still on "fear," etc.). This is all risk-on behavior that is consistent with an equity bull market... see page 2.
Actionable Industry ETFs: ARKG, ARKW, IBUY, and FNGS... see page 9.
EM and Int'l Markets. MSCI EM (EEM) displays a bullish 4-month downtrend reversal -- buy. MSCI EAFE (EFA) remains bullish... see page 10.
Actionable International ETFs: KWEB, MCHI, EWW, ECH, EPOL, UAE, EWG, EIS, HEDJ, EUFN, EUSC, and EWI... see pages 11-13.
Eisen-und Huettenwerke is a holding with investments in companies engaged in iron and steel processing. Eisen-und Huettenwerke also manages the real estate of its former production site. Eisen-und Huettenwerke's product categories and business include tinplate, sheet metal for electrical applications and a real estate management.
Vermilion Research delivers timely, actionable, and unique research inputs to professional investors. Our research strategists highlight securities which we believe are at major inflection points, based on our various proprietary technical indicators, and offer asymmetric risk/return profiles. We believe our research methodology, which is not limited by industry sector or market capitalization, enables us to deliver superior investment recommendations.
Our process begins by organizing all actively traded stocks into coherent sectors, then into logical industry groups. We then apply our proprietary relative strength tools to identify developing price trends. Once attractive trends are identified within a selected sectors or groups, we screen for individual stocks which we believe offer the best risk/reward profile. Vermilion offers U.S. and global equity market research products. Vermilion’s research team, which has received numerous awards and accolades, has a combined 70 year of experience in the analysis of investment securities.
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