Most Overbought & Oversold Assets

Just a little big picture perspective for you here.  This is the latest view of some of the biggest global asset classes and how oversold or overbought they are.  I used the percentage deviation from the 200 day moving average as a simple point of reference.

The notable stand-outs are natural gas vs brent crude and the stunning performance of the Nikkei Index versus all other equity markets.  If you thought the S&P seemed overbought….

As we all know by now, the commodity complex has been slammed in recent days and precious metals have taken the worst beating.   Silver is down an incredibly -24% from its 200 day moving average while gold is off -17%.  The beating in Brent Crude has been nearly as bad at -12%.

Chart via Orcam Investment Research:

ob_os

Cullen Roche

Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.

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Comments

  1. It would be interesting to see price performance 6-12 months after assets get over-bought/sold by certain amounts… My guess is half the time they revert to the mean and the other half the mean reverts to them… Or maybe correlations/divergences would be more interesting, ex copper down & S&P up, does the divergence mean anything?

  2. Cullen,

    uncanny how you post things I am thinking of at the time. Do you have any summary statistics about trading around highly overbought/oversold markets?

    Thanks