Jefferies Looks at Chemicals as a Leading Indicator
Tweet
Share
E-mail
There are a thousand indicators traders use to predict market movements, everything from obscure technical indicators to old-wives-tales. Today analysts at Jefferies equity research put out a research note that, if nothing else, is certainly worth a look.
The indicator Jefferies analysts are referring to is chemicals. Specifically, they are interested in chemical prices, which according the report is a leading indicator of market direction.
"Rising chemical prices can flag solid demand dynamics - supporting a bullish stance near-term," stated an analyst.
The data suggests this approach is particularly effective in periods of uncertainty, such as the Asia crisis, the 2001 recession, and of course the last 4 years. During these periods, changes in chemical prices can help forecast movements in the broader market.
Traders looking to play the Chemical sector should look at ETFs like Materials Select Sector SPDR (NYSE: XLY) and Dow Jones U.S. Basic Materials Index (NYSE: IYM).
The indicator Jefferies analysts are referring to is chemicals. Specifically, they are interested in chemical prices, which according the report is a leading indicator of market direction.
"Rising chemical prices can flag solid demand dynamics - supporting a bullish stance near-term," stated an analyst.
The data suggests this approach is particularly effective in periods of uncertainty, such as the Asia crisis, the 2001 recession, and of course the last 4 years. During these periods, changes in chemical prices can help forecast movements in the broader market.
Traders looking to play the Chemical sector should look at ETFs like Materials Select Sector SPDR (NYSE: XLY) and Dow Jones U.S. Basic Materials Index (NYSE: IYM).
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Manpower Inc. (MAN) PT Raised to $37 at Jefferies
- JPMorgan (JPM) PT Raised to $350 at Jefferies
- Shoals Technologies Group (SHLS) PT Raised to $12 at Jefferies
Create E-mail Alert Related Categories
ETFsRelated Entities
Jefferies & CoSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
