Flash Update – June 4, 2021

Published on: June 4th, 2021

Emerging Markets are on the cusp of breaking out to the topside in both relative and absolute terms. While this is pre-empting conclusive signs of USD weakness, Julian wants to pull the trigger on buying broad EM equities (EEM) and more narrowly both Brazilian Equities and the local currency. Caveats are included, but the macro picture favours the idea.

Comments

bf

bill f.

4 June 2021 @ 21:47

1 0

what is the evidence for a commodity super cycle?. thanks. the spx/commodities ratio always bother me
- HM
  
  Harry M. | Real Vision
  
  7 June 2021 @ 11:19
  
  0 0
  
  Pricing of Commodities and commodity companies in real terms. Absence of investment over a prolonged period of time. But, its like most investment hypotheses. There is a case for a commodity super cycle but its by no means a slam dunk.
DW

Daniel W.

5 June 2021 @ 10:41

16 0

General comment, but I really appreciate the difference in JB's style versus RP's. I find that I follow RP on many longer term "big-plays" and JB on these tactical positions, which provides a uniqueness to my portfolio construction and returns. Definitely a huge value for Macro Insiders!
FP

Fabio P.

5 June 2021 @ 14:10

6 0

Take care about Brazil, keep your stop close....from a Brazilian....
- RV
  
  Rodolfo V.
  
  11 June 2021 @ 20:04
  
  1 0
  
  I felt precisely the same with the EWW trade, I did not get involved. Being Mexican living in Mexico with enough portfolio in the country... But I should have in hindsight hahaha!
- HM
  
  Harry M. | Real Vision
  
  7 June 2021 @ 11:17
  
  6 0
  
  Indeed! I know you guys have seen phenomenal vol and its been a tough market for a while. But it can be very hard to be objective when you are very close to these matters. JBs biggest concern is the politics, which look potentially quite concerning. But markets climb a wall of worry and really, internationally speaking no one has Brazil. Its an obvious pain trade for the Global EM players.
SP

Stephen P.

6 June 2021 @ 05:53

0 0

Julian - what about the commodity currencies? I am surprised the Aussie especially has not appreciated significantly against USD - maybe this will happen once USD decides it will move down as expected.
- HM
  
  Harry M. | Real Vision
  
  7 June 2021 @ 11:15
  
  3 0
  
  Great question. The technical set up is not quite as attractive as BRL and AUD might be struggling cos of current friction with China.
AA

Andrew A.

7 June 2021 @ 10:20

0 0

Hi Julian. Thanks as always. What's happened to the Nikkei trade (Long from 30,100. Stop 28,000. Target >40,000) from your last In Focus of 12th May?
- AA
  
  Andrew A.
  
  7 June 2021 @ 16:18
  
  0 0
  
  Thanks Harry.
- HM
  
  Harry M. | Real Vision
  
  7 June 2021 @ 11:45
  
  1 0
  
  Yes, JB was stopped out on May 12th
- HM
  
  Harry M. | Real Vision
  
  7 June 2021 @ 11:14
  
  0 0
  
  Stopped I think.
JT

Jake T.

7 June 2021 @ 21:28

0 0

What is Brazilian IP yoy, what does ip stand for and what’s it’s relevance ?
- HM
  
  Harry M. | Real Vision
  
  14 June 2021 @ 02:14
  
  0 0
  
  Brazilian Industrial Production, Year on Year growth. Its going to be an excellent proxy for the business cycle in Brazil.
JT

Jake T.

7 June 2021 @ 21:32

1 0

What are the inputs that go into your EM model ?
TR

Tadej R.

11 June 2021 @ 13:01

0 0

I was looking at USDRUB for some time...could this be the same play as USDBRL? BTW...by staking BRL and RUB on binance.com you get extra 2-3% staking rewards. ;)
- HM
  
  Harry M. | Real Vision
  
  14 June 2021 @ 02:13
  
  2 0
  
  Yes except BR is an ally of the US and RF is not. So there is definitely some geopolitical content in USDRUB. One might argue that with the relationship as poor as it is, the only way is up. I cant comment on Binance.com
RK

Roger K.

19 June 2021 @ 10:17

0 0

Given the new market developments, Could we have a flash update pls? Is the theme still valid ???