Report
Dave Nicoski ...
  • Ross LaDuke
EUR 229.60 For Business Accounts Only

Vermilion ETF Pathfinder: Actionable ETF research & Ideas

Hanging in the balance

Last week's worse-than-expected economic data further spooked investors and reignited global growth concerns. Despite the many potential risks that we can point to for this market and the economy, thus far we are not seeing any technical breakdowns, and until we do, our neutral outlook remains appropriate.

• Cyclicals not breaking down. Key cyclical/risk-on areas of the market such as small-caps (IWM), banks (KBE), and transports (IYT) are not breaking down. As long as this continues to ring true the potential for a larger pullback in the broad market remains slim... see page 2.

• High yield spreads moving sideways; High yield bond ETFs holding above support. Trends in high yield spreads and high yield ETFs such as JNK and HYG suggest to us that the bond market is not flashing any major warning signs as it relates to the potential for a near-term recession... see page 2.

• Copper and WTI crude remain above support. Moves in these two commodities are closely tied with global growth/demand expectations. Neither are breaking down, which helps support our neutral outlook... see page 2.

• Actionable Industry ETFs: SOXX, IGV, ITA, and CRAK... see page 9.

• EM and Int'l: Developed international (EFA) and EM (EEM) equities remain in downtrends, however both are potentially making a higher low relative to the lows set in August -- an encouraging sign. Additionally, RS on the EEM is on the cusp of a bullish reversal, something that would be a welcomed sight for global risk sentiment... see page 10.

• Actionable Int'l ETFs: EWJ, EWT, EWW, and EWZS... see page 11.
Underlyings
Invesco S&P 500 Equal Weight Financials ETF

Invesco S&P 500 Equal Weight Health Care ETF

Invesco S&P 500 Equal Weight Materials ETF

iShares iBoxx $ High Yield Corporate Bond ETF

ISHARES MSCI BZL

iShares MSCI Emerging Markets ETF

iShares MSCI Japan ETF

iShares MSCI Mexico Capped ETF

iShares MSCI Taiwan ETF

iShares North American Tech-Software ETF

iShares PHLX Semiconductor ETF

iShares Russell 2000 Index Fund

iShares Transportation Average

iShares Trust MSCI EAFE Index Fund

iShares U.S. Aerospace & Defense ETF

Materials Select Sector SPDR Fund

REAL ESTATE SPDR

Select Sector SPDR-Consumer Discretionary

Select Sector SPDR-Consumer Staples

Select Sector SPDR-Energy

Select Sector SPDR-Financial

Select Sector SPDR-Health Care

Select Sector SPDR-Industrial

Select Sector SPDR-Technology

Select Sector SPDR-Utilities

SPDR Barclays High Yield Bond ETF

SPDR KBW Bank ETF

The Communication Services Select Sector SPDR Fund

VanEck Vectors Oil Refiners ETF

Provider
Vermilion Research
Vermilion Research

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.

Analysts
Dave Nicoski

Ross LaDuke

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