Global Macro Economic Update: August 2020

Macro Economic Update August 2020Introduction

I'm Trent Grinkmeyer, wealth advisor and co-founder of Grinkmeyer Leonard Financial. The following is a brief, hopefully easy to understand, explanation of where we feel global markets presently stand.


Three Patterns to Consider in Determining Market Direction

Price, volume, and volatility are the three measures I use to determine the direction of an investment. Today markets are traded heavily by computerized trading algorithms. In these algorithms three things that are considered are price, volume, and volatility. The chart below gives you directional references to consider as you allocate your investment portfolio.

PRICE (1) cropped


Patterns to Consider

NASDAQ 100 Volatility Index (VXN):

  • Less than 33, bullish
  • Greater than 33, bearish

S&P 500 Volatility Index (VIX):

  • Less than 26, bullish
  • Greater than 26, bearish

Gold Volatility Index:

  • Less than 30, bullish
  • Greater than 30, bearish

Market Trends

NASDAQ 100 continues to be in a bullish trend. VXN continues to be below 33 supporting the upward trend.

NASDAQ 1

NASDAQ 2

S&P 500 continues to lag the NASDAQ 100 due to a more diverse selection of sectors. Yet VIX continues to stay below 26 and supports it upward trend.

S$P

S&P2

Gold prices continue to trend higher. The GVZ in recent weeks has shown an increase in volatility, yet stays below the 30 mark.

Gold Price 1

Gold Price 2


Summary

All in all, a select few sectors continue to be in a bullish trend - technology, software associated with services, gold, and treasuries. We will continue our bullish allocation in these sectors for the foreseeable future.

Our world is changing rapidly. How we work, educate, and live will forever be changed. COVID-19 was the trigger that has change the direction of the world. Invest in the future.


Are Your Investments In Line with Your Risk Tolerance?

Our free risk tolerance questionnaire will help you understand your risk tolerance and whether your investments are in line with that tolerance.

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This information is intended for informational/educational purposes only and should not be construed as investment advice, a solicitation, or a recommendation to buy or sell any security or investment product. Please contact your financial professional for more information specific to your situation. Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Past performance is not indicative of future results. All indices are unmanaged and investors cannot invest directly into an index. Trent Grinkmeyer, Valerie Leonard, and Jamie Kertis are Registered Representatives and Investment Adviser Representatives with/and offer securities and advisory services through Commonwealth Financial Network, Member FINRA/SIPC, a Registered Investment Adviser. Fixed insurance products and services offered through Grinkmeyer Leonard Financial or CES Insurance Agency. This communication is not intended to replace the advice of a qualified tax advisor or attorney.

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