March twenty-ninth, two thousand twenty-six (260316-260329)
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*Recently, the platform has often deleted our posts, so we will gradually replace some sensitive terms. Starting with this article, we will refer to B**T*C as “Little Yellow.”
Caution! Many points of logic are discussed once and never repeated!!! Be sure to review the previous Weekly Wraps yourself!!! Absolutely essential!
In the new weekly newsletter, we have made the following main changes:
1) We have reordered major assets according to stronger logical connections and explained their mutual cross-validation and linkages more clearly, giving readers a comprehensive picture for finding anchors across asset classes... The process of seeking certainty is, in essence, the process of finding an anchor for pricing...; 2) We have strengthened our detailed analysis of the week’s developments, laying an expectations-based foundation for the longer term. Alongside informing position allocation, this also provides some reference for readers’ medium- and short-term actions... After all, every long-term decision is merely a series of rolling short-term decisions...; 3) We have reduced noisy asset classes. Positions that have been exited, and assets with no significant change in fundamentals (consistent with what we said the previous week),will no longer be continuously updated in the weekly newsletter and take up too much space. Instead, we will add assets that are urgently worth watching for entry... After all, what matters in practice for decision-making is what is happening now and what lies ahead. On this point, we need everyone’s cooperation in reviewing the historical content independently;we won’t be giving everyone a history lesson every week... But review is necessary and absolutely must not be skipped. Before reading, please also first read the Planet updates for the current week or relevant past trading days. 4) The content will gradually incorporate our own understanding of the world of investing and trading, and systematically explain our ideas and philosophy. These are our own views, offered to prompt further thought and for reference only; we ask for your understanding if anything is lacking.
Starting 251109, the weekly newsletter was completely revamped. For the historical framework and content, see “WEEKLY WRAP 251026” and earlier issues.
Starting 260322, the weekly newsletter was updated again, with its content organized into four major categories—equities, bonds, foreign exchange, and commodities—to lay out the key narratives.
Starting with gold, let’s open with Sean’s comments:
Chart: “TACTICAL POSITIONING | Week of 03.30”
The key lies in price itself. We operate on an if...then... basis.
Chart: As opposed to conviction, we operate on an if...then basis. You could call this a sign of timidity, but it is indeed our survival rule when dealing with Mr. Market.
Chart: Gold began to rally against the trend after Friday’s post was published
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To sum it up in one paragraph:The market is still mainly in a phase of high inflation and moderate slowdown, The inevitable losers are energy importers, European and Asian cyclical assets, vulnerable Asian currencies, and long-duration growth assets that depend on easy financial conditions. But if the shock spreads further into growth concerns, the next phase’s main theme will shift from inflation repricing to growth repricing. At that point, the drivers of long-duration rates, the yen, and the Swiss franc will all change. This is what is meant by a stagflationary outcome.
Hawkish pricing at the front end is already quite full. The real point of disagreement is whether high oil prices will continue to translate into downward growth revisions.
I.Foreign exchange (US Dollar Index, renminbi, CHF, INR, JPY, AUD, BRL, MYR, SEK)
Chart: US Dollar Index (four-hour chart, as of 260329)
The second test of the red line we drew long ago found strong support. We expect a new HH.
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We covered quite a lot in last week’s Wrap; if you haven’t finished reading it, you can go back and do so first. The Middle East conflict and high oil prices have not immediately pushed the market into recession trading, so in the short term, exchange rates are still being driven by the delay in non-US growth catching up with the US amid the energy shock, rather than by a full-scale collapse in global growth. That is why we say a stronger dollar remains the main theme.
However, we still do not view dollar strength as a brand-new, long-term one-way story.Unless prices confirm a breakout.
We do not favor taking large one-way positions before a decisive breakout.
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As for the discussion of de-dollarization(many institutions are saying that high oil prices are marginally weakening the dollar), the key is to distinguish between a settlement currency and a reserve currency. The dollar-peg systems in the Middle East, the reinvestment channels for dollar reserves, and transaction costs mean that even if the settlement share of RMB edges up, the dollar’s status will not be significantly eroded on a trading-time horizon. The dollar remains supported by real-world current accounts, capital flows, and safe-haven dynamics; a slogan about de-dollarization cannot rewrite that.
Chart: The worst-performing currencies are those of energy importers with fragile external balances and insufficient policy buffers; currencies relatively better supported by exports, energy structure, or commodity income have simply fallen less. De-dollarization remains nothing more than a slogan.
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AUD, BRL, and MYR:
Chart: USDBRL, USDAUD, and USDMYR (daily chart, as of 260329)
Of the three major currency pairs discussed last week, USDAUD and USDMYR, which had shown bottoming signals, closed the week strongly higher.
Chart: CHFINR (weekly chart, as of 260329)
The yen and the Swiss franc are not there yet, because as long as the market is still mainly trading inflation and oil prices, the dollar will continue to weigh on most currencies. They truly strengthen when the market starts trading growth and financial conditions. Clearly, the market is still unwilling to price in a future of impaired growth.
Chart: JPYINR (weekly chart, as of 260329)
The yen is currently caught between two characteristics: on the one hand, it is a traditional safe-haven currency; on the other, Japan itself is an energy importer.Therefore, as long as the market is mainly trading higher oil prices and higher inflation, JPY does not benefit. But if the market starts trading the idea that high oil prices will ultimately hurt growth, bringing yields and equities down together, JPY will quickly become a more effective safe-haven instrument.
The logic for the Swiss franc is similar, but with the added disturbance of SNB’s stance and the carry environment.In other words, JPY and CHF are not the top-priority themes under the current market-pricing backdrop, but they are the most important trading proxies in the next phase if the regime shifts. Keep a close eye on both.
Chart: Notes260317 “Oil Prices Are Just the Opening Act; the Real Repricing Will Be in Growth, FX, and the Industrial Chain”
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The US dollar broke out against the rupee; we added to our long position at the very first opportunity two weeks ago.
The entry into this trade was a substantive declaration that the shock trade had begun:
Chart: USD/INR (daily chart, as of 260329)
Note: The take-profit level has been raised to above 93.84.
As we have said, buying before a move starts (or at least as it starts) and responding in the best possible way at the right moment when the price arrives requires thorough research in advance. Ours is an if..then.. business: we never predict the market; we simply respond responsibly to the information it gives us. Expectations are not predictions. Those expectations about the price path may look like predictions, but they are actually research. In other words, we simply do not want to be caught off guard.
All technical analysis offers is “levels worth watching.” Only when the market validates our view can entries and exits be made repeatedly with a clear rationale. That is precisely what expectations mean: only by doing the necessary preparation can we have trading scenarios ready when prices actually trigger them.
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We have said this many times: the PBoC is currently prioritizing stability over appreciation.In fact, the timing of our assessment several weeks ago still formed a turning-point low (the red circle indicated by the arrow in the chart below):
Chart: USDCNH (daily chart, as of 260329)
The reason the US dollar–Chinese yuan exchange rate has remained stable is also that corporate dollar supply continues to provide support (see “WEEKLY WRAP 260322”).
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Of course, we always need to be prepared for the opposite path. Here, that would be a scenario in which the conflict ends quickly. In this scenario, the Swedish krona is a key trading proxy that we are watching closely, because it is one of the few currencies with the dual characteristics of being vulnerable to both a growth downturn and an energy shock.If the situation eases quickly and risk assets rebound, SEK will certainly be one of the strongest recovery currencies:
Chart: SEK overlaid with WTI (daily chart, as of 260329)
Two, Equities (US stocks, the Nikkei, UK100, GER40, EWZ, Hang Seng Tech, EEM)
The dominant drivers have shifted from earnings growth and valuation re-rating to the interplay among energy, interest rates, and growth.
Chart: SPX (daily chart, as of 260329)
SPX broke below the level after 100 bars, as we had forecast, and has continued moving lower ever since. The take-profit level for the daily short position has now been moved to 6591.Actually, at this stage, a rebound is more likely next week(a bounce back to the annual moving average, near the yellow line on the chart), so we will use the stop on the smaller timeframe (the panel at the bottom right of the chart above) as an option for taking profits progressively.
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The Nasdaq has just posted one of its worst weeks in nearly the past year:
Chart: IXIC (daily chart, as of 260329)
A short-term technical rebound is near, but a rebound is not the same as a reversal.The macro backdrop is not enough to support the market ignoring oil and interest rates again.
The trade rationale is the same as SPX.
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Another detail worth noting: Nvidia is now trading near forward valuation parity with, or even at a slight discount to, the S&P 500, while it is still expected to contribute a large share of the index's earnings growth over 26 years. This shows that the market is not directly rejecting AI capital expenditure or the earnings power of industry leaders; it is simply applying a higher macro discount rate.
Chart: In other words, at least for now, the industry rationale really cannot outweigh macro pricing.
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Another trade we are watching is a paired trade in U.S. and Chinese semiconductors. In other words, while macro factors are outweighing industry fundamentals in U.S. tech, China has the support of still-accelerating capital expenditure and the broader backdrop of self-reliance and controllability which should provide a relatively better buffer. Even if valuations are dragged down in the short term by global risk appetite, Chinese semiconductors should continue to outperform U.S. tech over the foreseeable future. Once the market shifts from pure macro fear back to differentiation between industries, this area will be positioned to regain a valuation premium.
Chart: Potential relative outperformance
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Chart: Nikkei futures (daily chart, as of 260329)
The trade rationale is the same as for the U.S. dollar index, global risk assets are effectively all exposed to the same factors right now(the same applies to Europe below, so I won't repeat it). A rebound, but not a reversal.Until we see genuine and clear signs of easing, Japan, as an energy importer, will continue to face deteriorating terms of trade. So even if Japanese equities are not expensive, external cost shocks could easily drag them back down. The framework is essentially the same as in Europe, except that Japan is more squeezed by import costs and the exchange rate.
Chart: UK100 (daily chart, as of 260329)
Chart: GER40 (daily chart, as of 260329)
Note that if ECB continues to raise interest rates amid high energy prices, that would be a policy mistake on a scale close to 2008- and 2011-style episodes, and the risk of a European recession would quickly become a certainty!
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I'll leave the mainland indices aside here; you can look at the data across the three timeframes yourselves.
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Besides, I’m actually not too keen on discussing micro-level details in the weekend edition, but I still have to mention this:
Chart: Incremental positioning
1）Those shock trades based on long-term fundamental narratives are actually not suitable for the long term. 2) Short-term themes don’t necessarily deliver profits right away either; what’s really most dangerous is getting the direction wrong.
Take upstream industries and bulk chemicals, for example. BASF These companies can see short-term earnings rise rapidly because of higher raw material prices, disruptions to production facilities, and supply contraction. This kind of supply shock often first creates a very enticing earnings boom, but the outcome is often a more painful bust a few quarters later, driven by demand destruction. Fertilizers are another typical example. Near-term earnings for nitrogen fertilizers are very likely to continue being revised upward, but if high prices persist through 2H26, the demand side’s ability to bear them will run into trouble first, especially against a backdrop where affordability is already stretched. The risk of a correction in the second half of the year will rise markedly. In other words, This is not a simple directional trade, but a typical trade on stages: after a supply shock, demand destruction is inevitable. A swing position cannot be turned into a long-term holding. Those who use fundamental arguments to justify holding long term may understand the economy, but they do not understand the market.
Another example is defense. Friends who have been following the channel for a while should be impressed by the European defense trade we started at the beginning of the year, but The problem is that after the first huge rally, our second entry did not turn out well. We actually got caught by this same issue.
There is no denying that cheap drones, counter-UAS, short-range air defense, cheap missile, and electronic warfare are clearly major themes for the coming years. But for large defense stocks, the real question now is still when revenue and profits will catch up with the theme. The market is already trading these areas, but many companies are still investing in capacity and waiting for contracts to be finalized. So some of the current volatility in defense stocks comes from degrossing and momentum unwind; another part is likewise a matter of timing. It is not entirely due to changes in fundamentals.
Three.Commodities (gold, silver, copper, aluminum, uranium)
Chart: CMX silver (daily chart, as of 260329)
It remains above the 66.76 support line given earlier; on the daily timeframe, it is still in a short position.
Chart: CMX silver, lower timeframe (four-hour chart, as of 260329)
The lower-timeframe trading position was passively exited according to plan and is currently flat (see “WEEKLY WRAP 260322”).
Chart: Regarding taking partial profits at T3
Looking back today, our T3 target price effectively marked an interim low.
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Chart: SLV (daily chart, as of 26039)
At the yellow-circled area, we made another planned bullish allocation-position entry. If it returns to the 1x target below, we will make a second allocation-position purchase. This portion is being built gradually in stages, Note, the trading position has remained flat throughout If you are an individual trader with little capital, there is actually no need to follow me in making allocation-position trades. Capital utilization is relatively low, and there are many markets where you can trade swings. This is only an update for informational purposes and does not constitute a buy or sell recommendation.
If it moves back above 66.42, we will reopen a trading position on the daily timeframe (long).
Chart: Regarding continued allocation-position buying on dips in physical mineral resources
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Chart: CMX gold (daily chart, as of 260329)
The daily chart turns bullish above 4.6k.
An institutional buying signal appeared last Friday and remains in effect.
Chart: GDX (daily chart, as of 260329)
GDX has continued to fall since the exit signal was posted on Planet (the red arrow on the chart),This is exactly why you must set take-profit and stop-loss levels—they really can save your life!
Likewise, when we return to 75, we will gradually build and add to our core position.
A move above 88.13 will trigger entry into a long position in the trading portfolio.
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Chart: Gold and silver (daily chart, as of 260329)
Note that if it breaks out here, gold may outperform.
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Chart: Shanghai copper (daily chart, as of 260329),Failed to reclaim the green line
It was precisely capped by the green line we drew earlier......
For Shanghai copper to turn bullish again on the daily chart, it needs at least to reclaim 96330.
Although copper’s fundamentals are already very poor, even if this trade turns bullish, the conviction is low, and it will most likely be stopped out:
Chart: The fundamental picture is not encouraging
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Chart:The aluminum trade is a key industrial metals setup we are watching
Chart: Aluminum-to-copper ratio (weekly chart, as of 260322)
The chart above shows the aluminum-to-copper ratio on a weekly basis. So far, the shorter time frames have all turned bullish, and the weekly chart is also approaching its bullish reversal level.
We will not repeat the information on aluminum’s fundamentals here; you can read this post on Planet carefully:
Chart:View note
Simply put, in the current market environment, aluminum does have some relative long appeal among industrial metals. However, as market participants, we cannot predict, cannot jump the gun; we must wait for the price to validate our view：
Chart: Shanghai aluminum (hourly chart, as of 260329)
Moved above the 200-period moving average and completed an engulfing pattern.
At present, if it breaks through 24345, Shanghai aluminum will turn broadly bullish on the daily timeframe and below. On the weekly timeframe, it needs to get back above 26185.
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Oil: followed the plan and exited; currently holding no position.
Chart: A sound basis for advancing or retreating
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Chart: URA (daily chart, ring 260329)
Uranium has stabilized above the annual moving average, but the signal to go long again has not yet been triggered, so don't jump the gun. A bullish turn requires the price to move above 49.09.
Four. Alternative assets (Xiao Huang)
Chart: Xiao Huang (daily chart, as of 260329) (the model only displays the SHORT ONLY portion)
Broke through our 1x target (74.5k) and 2x target (65k) in succession, near 60k, the position management system issued a signal to reduce the short position(orange circle, point B on the chart)(B in a short position and S in a long position are signals to reduce the position!) We have taken profits and reduced the position here; we continue to hold the remaining short position until an automatic exit.
Since taking profits, Xiao Huang has found precise support between our 1x and 2x target levels and has traded in a narrow range ever since,
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(End of article)
A quick plug: our US stocks, A-Hong Kong market, and commodities platforms, which are designed to be used together, continue to expand their content.
US stocks:https://www.meridianresearch.app/home?product=us-strategies(Xingzhi)
A-Hong Kong market:https://www.meridianresearch.app/home?product=asia-strategies(Ganglong)
Commodities:https://www.meridianresearch.app/home?product=commodity-strategies(Dixin)
Note: Everything in this article is for reference only and does not constitute any investment advice, nor should it be taken as a basis for any laws, regulations, or regulatory policies. Investors should not use or rely on this information as a basis for their decisions.