The Technicals of a Turning Cycle

Published on
October 28th, 2019
Duration
40 minutes

Gold and “The Prettiest Mare at the Slaughterhouse”


The Technicals of a Turning Cycle

The Expert View ·
Featuring Sven Henrich

Published on: October 28th, 2019 • Duration: 40 minutes

Are global equity markets approaching a critical threshold? Sven Henrich is the chief market strategist for NorthmanTrader - a firm that uses technical indicators to track global equity markets. Henrich argues that with or without complete central bank capitulation, markets are in for a year-end rally that will not be able to sustain or surpass its new highs. He compares the final months of 2019 to the final months of 2007, pointing out the critical divergence in the Fed's ability to lower interest rates further - having less than half the wiggle room than the 500 basis points they had in 2007. Filmed on October 9, 2019 in London. For more of Henrich's research visit https://northmantrader.com

Comments

Transcript

  • as
    andrew s.
    8 December 2019 @ 16:37
    Guy spends his time blocking anyone with different view so he doesn't have to debate.
  • WM
    Will M.
    17 November 2019 @ 15:27
    Great interview. I just loved his reminder, ALMOST no one sees the start of a bear market. Its only in hind sight that the vast majority understand what happened. This time is much worse because of the deterioration is so many metrics. The stock buy backs are completely hiding a lack of saver participation in the bull market. The question for me personally is, will any sustained market rise now signal a blow off where the average investor finally jumps on the bandwagon for FOMO? Or will the current raft of potential bad news, recession, Brexit, China trade, Presidential impeachment, finally push the market breakage. I have no idea which comes first, therefore must play both ends and continue to suffer low single digit average returns.....
  • KA
    Kelly A.
    29 October 2019 @ 00:50
    Interesting about the Dec sell-off effect vis-a-vis Raoul's notes over the past couple years about boomers needing to pull money out in greater and greater quantity to meet retirement fund rules, starting at age 70.5. In other words: it seems that perhaps, if R is correct, that the Dec effect that Sven says is more rare, might have another year or two in it. ??? thoughts please!
    • RC
      Robert C.
      29 October 2019 @ 01:31
      The age 70.5 rule I believe can have an effect, but you can take the funds out anytime of the year. Basically you have to be able to pay your required minimum distribution. So like maybe 4/5% of your account every year. Also some legislation is being proposed to delay the rules to start at age 72.5. I see the baby boomer thing more as they can't afford big loses at this time of their retirement cycle.
    • RC
      Robert C.
      29 October 2019 @ 01:32
      Meant need to take your required minimum distribution and this is just out of your retirement accounts.
    • KA
      Kelly A.
      31 October 2019 @ 21:33
      Thank you Robert C. Much appreciated. I also saw in THINK TANK that another contributing factor to 2018 see off was also prompted, of course, by QT and related. That is not happening this year, so sell off this year is less likely --at least because of that. Nevertheless, corp stock buybacks are still key to S&P multiple expansion.
    • WM
      Will M.
      17 November 2019 @ 14:47
      The extent of the drawdown amounts in RMD is also up for a change, essentially reducing the amount of RMD coming out year after year. This is almost a slam dunk given the increases in aging and the need to ensure the government doesn't have to step in to help those who have resources and the current boomer domination of political power.
  • SK
    Surf K.
    1 November 2019 @ 12:09
    What does he mean by "yearly 5 EMA" around 23:00? 5-day EMA on a yearly chart? That makes not much sense to me..
    • MH
      Mark H.
      1 November 2019 @ 21:23
      I think he just means a five period EMA on whatever timeframe you’re looking at - price will always revert to that five period EMA. I haven’t looked at it on a chart yet but that’s how I interpreted what he was saying. On a daily it’s a five day EMA, on a weekly, a five week EMA etc.
  • NI
    Nate I.
    31 October 2019 @ 04:10
    Tax dollars --> underfunded pensions --> pensions buy bonds --> bond issuers buyback stock --> stock holders sell shares and pay taxes. Wash, rinse, repeat for the past decade or more. Ballooning debt levels force central banks to suppress interest rates to keep the wheels on the bond market bus. Today, taxpayers are tapped out and servicing ballooning debt levels gets more challenging with each iteration through the loop, even with artificially low rates. In my opinion, the ability to continue with this loop is in the 8th or 9th inning. I'm not predicting a crash because maybe the next step is for central banks to buy stocks directly. Hard to say, but I don't see too many more cycles through the loop being possible as 0% is approaching (each cycle needs more tax dollars as pensions become less and less solvent with lower and lower yields on their bond holdings).
  • DV
    Dimitri V.
    30 October 2019 @ 19:42
    Good interview but 19 days lags in these markets are too long
  • PP
    Peter P.
    29 October 2019 @ 20:07
    The oldest video I could find on him was September 2016. He was predicting a 25% then from S&P 2100. Needless to say, a really bad call. https://www.cnbc.com/2016/09/13/stocks-are-primed-to-drop-25-percent-before-the-year-is-out-northman-trader.html
    • CT
      Christopher T.
      30 October 2019 @ 02:27
      this guy has one of the worst track records
    • RK
      Robert K.
      30 October 2019 @ 14:53
      In headline driven and central bank manipulated bull markets all bulls are geniuses. Till the turkey meets Christmas.
  • jc
    judith c.
    29 October 2019 @ 03:53
    I miss the good old days, when you actually had a real interviewer present on camera instead of "miss robot voice " and the sound of a dot matrix printer. Real vision needs more Ed Harrison and Justine Underhill types please.
    • JS
      Johannes S.
      30 October 2019 @ 06:08
      I disagree. This format works very well for me. And I love that they added the voice, because in the past they would display the questions just as text and I would miss them when listening to the interviews with audio only. No need to change anything about this RV!
  • mp
    michael p.
    29 October 2019 @ 03:39
    The idea of RealVision is to to provide information that will help to yield positive investments to its subscribers. It should not be a forum for its own bearish viewpoints. It should know that sounding bearish as the Northman trade does sounds great but is not and has not not for a long time been beneficial to ones returns. He has been bearish albeit sounding very intelligent for a long while. In fact, if he invested his viewpoint, he might well be BK. Please stop with these individuals who have no track record. I would recommend that every person on your show start with performance and if they do not have one state that they do not actually run money. Let’s get real. Please stop with these intellectually smart bears or bulls that are on paper.
    • BF
      Bref F.
      29 October 2019 @ 05:28
      Completely agree, Skin in the Game as a pre-requisite.
    • PP
      Peter P.
      29 October 2019 @ 19:58
      Agree. The doom loop guy running this seems to mostly just be pushing his theories and ideas here, or others who share those opinions. This despite them being wrong for nearly a decade. Sure someday they will be correct, but missing an entire massive bull market in stocks has been extremely costly to them and their followers.
    • TE
      Thomas E.
      29 October 2019 @ 20:53
      Alot of guys have skin in the game but don't perform and have poor market analysis. I hear what you are saying. It's up to the user to listen to the interview and have "take-aways." The user then should do his/her own analysis and see if he or she agrees with view of the person being interviewed. Real Vision has hosted plenty of Bulls as well.
    • CT
      Christopher T.
      30 October 2019 @ 02:29
      couldn't agree more. tiresome
  • RH
    Robert H.
    30 October 2019 @ 00:27
    Nicely done. Quite easy to see by the comments that volatility is not some viewers friend. Mr. Henrich here has narrowed down exactly what has happened since 2018 - volatility. I think it's wonderful. Knowing what to look for on a drop like May or August makes my happy wife a happy life for me. A crooked line is much longer than a straight one. Also, Henrich appears to call himself a technical trader but he pairs the charts with the human factor which is imperative. If anything, it narrows down the possibilities.
  • BP
    Bryce P.
    29 October 2019 @ 19:09
    One of the best pieces RV has put out in awhile.
  • KA
    Kevin A.
    29 October 2019 @ 11:44
    Great interview. Although he is a technician, he can have a good conversation (well, with the bot in this case) about some of the fundamentals of the market. I do feel that he falls into the trap - probably unknowingly - of covering all of his bases in terms of what happens. He throws a lot of statements out there so that he is always going to be right on a market turn up or down. Market goes down, he called it. Market goes up, it is a temporary melt-up. A lot of strategists do that in my view.
  • SG
    Sven G.
    29 October 2019 @ 10:11
    My name is Sven, so I guess I'm a little biased... have to say that was some rock solid analysis! Thanks Sven
  • MF
    Mowgli F.
    29 October 2019 @ 02:06
    Pretty sure Sven Heinrich has been bearish for the past four years, pretty much a perma bear. Oh and the SPX just hit a new ATH.
    • WW
      William W.
      29 October 2019 @ 03:11
      Not true (other than than the ATH thing)...but do your own homework if you're that interested...it is possible to be a longer-term bear with episodes of shorter-term bullishness.
  • JJ
    Jesse J.
    29 October 2019 @ 00:28
    Okay let's get into this! First off thought the interview was really good. While I didn't agree with all of Mr. Henrich's points he makes some very convincing arguments. I loved the VIX analysis, I think there is some good money to be made there in the short term. I enjoyed the technical analysis covering Debt to GDP (144%/137/144/146%) and now we're back at 144% and going higher! That's a very convincing argument for me because I think a lot of traders probably pay attention to that statistic. As to how long the FED can keep this up. We'll I'm thinking until about 2025-6. That's not an exact date though and let me explain a bit. It seems the markets reset about every 25-30ish years. 1944 Bretton Woods to 1971 gold standard removal. 1971 to 2001 WTC collapse and movement to extreme deficit spending. 2008 collapse but kicked up due to QE so we're really on in about 19ish years. We've still got rates to hit 0%, MMT to go through (I think it's coming regardless of being good or not and it's going to be a political battle), and helicopter money to distribute. We seem to be in the midst of a cycle that is much longer and totally separate than any other (which is why it's "undiscovered"). Will the system fail? Yep. I think it's a much longer way off than most others though. We have lots more bad monetary policy to get through (several mini crashes), political unrest to really get going (it's still mostly peaceful atm), this trade war is really just getting going and only stalled a bit due to the coming election. Even though we're slowing down we still haven't stopped growing. It's like putting on the breaks to make a turn but you're not exactly sure where the turn is. You keep breaking anddddd "nope, next one".... "nope, next one". The positive of all this system of things is that Mr. Henrich analysis of volatility I think is spot on. If you like volatility, I think that's gonna be an annual opportunity to make some money. The realistic side of me is sad we're heading down this road and I wish I could correct it. I can only watch, read, listen, learn, and bet. Finally also, TYVM for putting in the charts on the transcripts. I know whomever did that put in extra work and I appreciate your dedication!!!!
    • KA
      Kelly A.
      29 October 2019 @ 00:43
      Jesse J. Thank you for your thoughts. Very enjoyable.
    • JJ
      Jesse J.
      29 October 2019 @ 00:48
      Thanks Kelly.
    • WB
      William B.
      29 October 2019 @ 01:42
      Jesse J. Your comments are very insightful. The interview was great. I am shorting the S&P, so if the whole thing crashes, I will make money. On the other hand, I have 3 children who will feel economic pain. Like any good parent, I would rather feel pain than have my children feel pain.
  • RC
    Robert C.
    29 October 2019 @ 00:47
    Really like Sven's work. I think he has been very on the mark the last few years. He asks the relevant questions if you ask me. How much more can central banks do? Rates are near rock bottom now.
  • FB
    Frank B.
    29 October 2019 @ 00:01
    There is a group of macro analysts on twitter, Sven is one, who offer a lot of charts, opinions, but at the end of the day their ability to predict is 50/50 at best.
  • SU
    Shakeel U.
    28 October 2019 @ 23:13
    Brilliant 10/10 and I'm glad it wasn't another video about Bitcoin 😀
  • RK
    Roger K.
    28 October 2019 @ 21:11
    This is the rational bit! But but " the market can stay irrational longer than you can stay solvent". What if FED decided to buy all the risk assets in perpetuity?
    • CB
      Clifford B.
      28 October 2019 @ 23:04
      keep printing.
  • MG
    M G.
    28 October 2019 @ 22:47
    Loved the interview. & Thank you for the charts in the transcript!!!
  • CL
    Chris L.
    28 October 2019 @ 19:02
    same ol Sven. nothing changes. heard this before
    • EF
      Eric F.
      28 October 2019 @ 22:20
      Disagree Chris. I’ve seen / read Sven bullish & bearish. It’s a bit flippant to say otherwise. I think we could see a further melt up, but if you’re bullish in this environment of QE, rate cuts & repo issues then I think you’re missing the massively conflicting signals being sent out. I also think what could / should have been run of the mill corrections could be blown up into a depression or revolution. We’re already seeing signs globally of the latter.
  • SM
    Sebastian M.
    28 October 2019 @ 19:38
    My man Svenrich
  • TR
    Thomas R.
    28 October 2019 @ 19:09
    My hero!
  • CB
    Clifford B.
    28 October 2019 @ 15:15
    Very Insightful talk. Interesting that Sven mentions Germany, baby boomers/aging populations/decreasing work force. Germany is welcoming refugees while many others are closing borders. Time will tell how each country fares.
  • JQ
    JACK Q.
    28 October 2019 @ 14:57
    Just hit that new high
  • JH
    Jesse H.
    28 October 2019 @ 12:39
    Great interview / presentation. Thank you, Sven!
  • PU
    Peter U.
    28 October 2019 @ 09:58
    Sven has emerged as a great strategists and chartists. Great command of the macro and the markets. I got to know him about 10 years ago. Quality guy all around.
  • SR
    Steve R.
    28 October 2019 @ 06:57
    Just love his summary at the end - absolutely nailed it in my opinion!

Mark Yusko

Morgan Creek Capital Management, Co- Founder, CEO, & CIO

Mark Yuskois the Founder, CEO and Chief Investment Officer of Morgan Creek Capital Management. He is also the Managing Partner of Morgan Creek Digital Assets. Morgan Creek Capital Management was founded in 2004 and currently manages close to $2 billion in discretionary and non-discretionary assets. Prior to founding Morgan Creek, Mr. Yusko was CIO and Founder of UNC Management Company (UNCMC), the Endowment investment office for the University of North Carolina at Chapel Hill. Before that, he was Senior Investment Director for the University of Notre Dame Investment Office.Mr. Yusko has been at the forefront of institutional investing throughout his career. An early investor in alternative asset classes at Notre Dame, he brought the Endowment Model of investing to UNC, which contributed to significant performance gains for the Endowment. The Endowment Model is the cornerstone philosophy of Morgan Creek, as is the mandate to Invest in Innovation. Mr. Yusko is again at the forefront of investing through Morgan Creek Digital Assets, which was formed in 2018. Morgan Creek Digital is an early stage investor in blockchain technology, digital currency and digital assets through the firm’s Venture Capital and Digital Asset Index Fund.Mr. Yusko received a BA with Honors from the University of Notre Dame and an MBA in Accounting and Finance from the University of Chicago.

Anthony Scaramucci

SkyBridge Capital, Founder & Co-Managing Partner

Prior to founding SkyBridge in 2005, Scaramucci co-founded investment partnership Oscar Capital Management, which was sold to Neuberger Berman, LLC in 2001. Earlier, he was a vice president in Private Wealth Management at Goldman Sachs & Co. In 2016, Scaramucci was ranked #85 in Worth Magazine’sPower 100: The 100 Most Powerful People in Global Finance. In 2011, he received Ernst & Young’s “Entrepreneur of the Year –New York” Award in the Financial Services category. Anthony is amember of the Council on Foreign Relations (CFR), vice chair of the Kennedy Center Corporate Fund Board, a board member of both The Brain Tumor Foundation and Business Executives for National Security (BENS), and a Trustee of the United States Olympic & Paralympic Foundation. He was a member of the New York City Financial Services Advisory Committee from 2007 to 2012. In November 2016, he was named to President-Elect Trump’s 16-person Presidential Transition Team Executive Committee. In June 2017, he wasnamed the Chief Strategy Officer of the EXIM Bank. He served as the White House Communications Director for a period in July 2017. Scaramucci, a native of Long Island, New York, holds a Bachelor of Arts degree in Economics from Tufts University and a Juris Doctor from Harvard Law School.

Michael Saylor

MicroStrategy, Co-Founder

Mr. Saylor is a technologist, entrepreneur, business executive, philanthropist, and best-selling author. He currently serves as Chairman of the Board of Directors and Chief Executive Office of MicroStrategy, Inc. (MSTR). Since co-founding the company at the age of 24, Mr. Saylor has built MicroStrategy into a global leader in business intelligence, mobile software, and cloud-based services. In 2012, he authoredThe Mobile Wave: How Mobile Intelligence Will Change Everything, which earned a spot onThe NewYork TimesBest Sellers list. Mr. Saylor attended the Massachusetts Institute of Technology, receiving an S.B. in Aeronautics and Astronautics and an S.B. in Science, Technology, and Society.

Alex Saunders

Nugget's News, Founder & CEO

Alex Saunders is the founder and CEO of Nugget’s News, a digital media company focused on all things crypto. Alex has been captivated by cryptocurrency since 2012 and in 2017 he began educating globally on the benefits of cryptocurrency and how to safely acquireit. Nugget’s News has been listed as a top-20 podcast by Business Insider, ShapeShift and Lifehacker and has over 120k YouTube subscribers with 9 million total views.Alex is also heavily focused on his cryptocurrency education platform Collective Shift which currently serves over 4,500 members. provides his unique perspectives by utilising his expertise in fundamental analysis, technical analysis and market sentiment. He is working towards his mission of making it easier for everyone to understand the financial world.

James Putra

TradeStation Crypto, Inc., Sr. Director of Product Strategy

James helped launch TradeStation Crypto’s offeringwhichutilizesa true online brokerage model that self-directed investors and traders have come to expect for equities, futures,and foreign currency markets. He is a reputed crypto asset specialist and blockchain thought leader focused on helping people find innovativeways to participate in this space. He is active in the blockchain community with speaking engagements, TV appearances and mentoring.James has over 15 years of experience in the Fintech industry.

Raoul Pal

Real Vision, Co-Founder & CEO

Raoul Pal is the Co-Founder and CEO of Real Vision, the world’s pre-eminent financial media platform, which helps members understand the complex world of finance, business, and the global economy. Real Vision members also have access to Real Vision Crypto, a cryptocurrency and digital assets video channelwatched by over 80,000 people.In addition, Raoul has been publishing Global Macro Investor since January 2005 to provide original, high quality, quantifiable and easily readable research for the global macro investment community hedge funds, family offices, pension funds and sovereign wealth funds. It draws on his considerable 31 years of experience in advising hedge funds and managing a global macro hedge fund. Global Macro Investor has one of the very best, proven track records of any newsletter in the industry, producing extremely positive returns in eight out of the last twelve years. He retired from managing client money at the age of 36 in 2004 and now lives in the tiny Caribbean island of Little Cayman in the Cayman Islands. Previously he co-managed the GLG Global Macro Fund in London for GLG Partners, one of the largest hedge fund groups in the world. Raoul moved to GLG from Goldman Sachs where he co-managed the hedge fund sales business in Equities and Equity Derivatives in Europe. In this role, Raoul established strong relationships with many of the world’s pre-eminent hedge funds, learning from their styles and experiences. Other stop-off points on the way were NatWest Markets and HSBC, although hebegan his career by training traders in technical analysis.

Peter McCormack

What Bitcoin Did, Journalist

Peter McCormack is a full timejournalist/podcaster covering topics such as Freedom, Human Rights, Censorship and Bitcoin. Peter created and hosts the What Bitcoin Did Podcast, a twice-weekly Bitcoin podcast where he interviews experts in the world of Bitcoin development, privacy, investment and adoption. Launched in November of 2017, the podcast has grown to over 100 episodes with a guest list that is a testament to the diversity of knowledge and opinions that represent the broader Bitcoin community. Expanding his growing list of humaninterest recordings, documentaries and films Peter has recently launched theDefiancepodcast andDefianceTV.

Caitlin Long

Avanti Financial Group, Founder & CEO

22-year Wall Street veteran who has been active in bitcoin and blockchain since 2012. In 2018-20 she led the charge to make her native state of Wyoming an oasis for blockchain companies in the US, where she helped Wyoming enact 20 blockchain-enabling laws. From 2016-18 she jointly spearheaded a blockchain project for delivering market index data to Vanguard as chairman and president of Symbiont, an enterprise blockchain start-up. Caitlin ran Morgan Stanley’s pension solutions business (2007-2016), heldsenior roles at Credit Suisse (1997-2007) and began her career at Salomon Brothers (1994-1997). She is a graduate of Harvard Law School (JD, 1994), the Kennedy School of Government (MPP, 1994) and the University of Wyoming (BA, 1990).

Hunter Horsley

Bitwise Asset Management, CEO

Hunter Horsley is Chief Executive Officer of Bitwise Asset Management. Prior to Bitwise, he was a product manager at Facebook, working on advertiser products including the multibillion-dollar sponsored content ecosystem and ad breaks in videos. Before Facebook, Horlsey was a product manager at Instagram, responsible for multiple advertising products generating several hundred million dollars of revenue. He is a graduate of the Wharton School at the University of Pennsylvania, with a B.S. in economics. Recently, Horsley was named a member of Forbes’ 2019 “30 Under 30” list.

Luke Gromen

Forest For The Trees, Founder & President

Luke Gromen has 25 years of experience in equity research, equity research sales, and as a macro/thematic analyst.He is the founder and president of macro/thematic research firm FFTT, LLC, which he founded in early 2014 to address and leverage the opportunity he saw created by applying what clientsand former colleagues consistently described as a “unique ability to connect the dots” during a time when he saw an increasing “silo-ing” of perspectives occurring on Wall Street and in corporate America.FFTT caters to institutions and sophisticated individuals by aggregating a wide variety of macroeconomic, thematic and sector trends in an unconventional manner to identify investable developing economic bottlenecks for his clients.Prior to founding FFTT, Luke was a founding partner of Cleveland Research Company, where he worked from 2006-14.At CRC, Luke worked in sales and edited CRC’s flagship weekly thematic research summary piece (“Straight from the Source”)for the firm’s clients.Prior to that,Luke was a partner at Midwest Research, where he worked in equity research and sales from 1996-2006.While in sales, Luke was a founding editor of Midwest’s widely-read weekly thematic summary (“Heard in the Midwest”) for the firm’s clients, in whichhe aggregated and combined proprietary research from Midwest with inputs from other sources.Luke Gromen holds a BBA in Finance and Accounting from the University of Cincinnati and received his MBA from Case Western Reserve University.He earned the CFA designation in 2003.

Meltem Demirors

CoinShares, Chief Strategy Officer

Meltem Demirors is Chief Strategy Officer of CoinShares, an investment firm that manages billions in assets on behalf of a global investor base, and is a trusted partner to investors and entrepreneurs navigating the digital asset ecosystem. Meltemoversees the firm’s managed strategies group and its New York office and leads corporate development. Previously, she was part of the founding team of Digital Currency Group. As a veteran investor in the digital currency space, she has invested in over 250 companies in the ecosystem. Meltem is passionate about education and advocacy, and teaches the Oxford Blockchain Strategy Programme and co-chairs the WEF Cryptocurrency Council.