Javed Mirza

Ideally, he'd like to see both the S&P 500 and the TSX hit new highs, so he'll be watching to see what the S&P 500 does here. If he and his team are correct in the broader view that we're late cycle, the TSX should outperform the S&P 500. That's what it's done so far because of the resource weighting. As we get late in the cycle, resources typically get a better bid.

If you can imagine a line going from bottom left to upper right, that represents the secular bull market he believes we're in until 2030. Within that chart, you have these 3-5 year cycles. He thinks a new cycle began in October 2022, and this cycle is getting long in the tooth.

From a lot of the signs he's seeing, at some point this year we're going to see the end of the cycle. It's going to be a great investment opportunity, but right now he's seeing some cautionary warning signs. The market's getting a bit frothy here.

Looking at this indicator, around 1 is flat, which is an even number of buyers and sellers exchanging puts and calls. Over the last couple of weeks, investors have been quite exuberant and buying far more calls than puts. It's really at an extreme. He's quite concerned, as this is what you typically see when things are frothy.

In theory, he's a momentum guy, so it's fine that we're seeing this kind of momentum. But concern comes because the market internals aren't really there.

Conversely, if we saw a lot of puts being bought, he'd be a lot happier about how the market internals look. He's nervous, and you'll see this in his best ideas later on. He just wants to be safe and steady right now.

Continue to let your winners run. But when it comes to putting new $$ to work, be cautious and wait for more of a pullback. If he's correct on the longer-term cycle work, there's going to be a greater opportunity either later this year or early next in terms of a bigger correction. He calls that a 4-year cycle reset, others call it a cyclical bear market.

Typically you see a 15% correction on price, lasting ~34 weeks. That's what we saw in 2022. We saw the same thing during the Trump administration in 2018. 

It's trying to find a floor around the 69 cent level. The next level after that is 67 cents, and big-floor support should be around 65 cents. Commercial hedgers ("smart money") are very long the CAD here. They're a good barometer, so we should see some sort of bounce. Political moves should be a tailwind for the CAD.

That being said, he was wrong when it moved below 70 cents, but it does look like it's trying to stabilize.

Anything that's a market driver should be priced into the market. Human behaviour is what drives a lot of his work. That's why technical analysts have such a tough time grappling with things like social media, as analysis wasn't designed to take into account that amount of crazy dopamine ;)  

The pandemic was definitely a curveball because it didn't fit into the traditional 4-year cycle work he does. The "4-year cycle" is just a fancy way of saying the business cycle. His team has been getting a lot of questions about tariffs. 

He'd recommend looking back to what happened during the last Trump presidency, 2016-2020. When he started, we'd just gone through a 4-year cycle reset, and we went through a truncated version in 2018. Broadly speaking, everything should be reflected in the price dynamics, so he should be able to monitor it. That's what makes the markets exciting, because every cycle is different.

The one factor that never changes is humans and human behaviour, and that's what technical analysis monitors.

It continues to work, even weathering the DeepSeek storm earlier this week. His only concern is on the semiconductors, SMH and SOXX. This name is part of that group, and the group is lagging the broader market. If the broader semi space comes under pressure, CLS will likely follow suit.

The semiconductors are a great barometer for information technology. The new cycle started in 2023, there was a big uptrend, and the chart now is showing distribution. What that means is that institutional investors are looking to reduce exposure. Over the last couple of months, we've been hugging this key level at the 40-week MA; on Monday, we moved below it.

So the S&P 500 made new highs this week, which might extend today, but we have this negative divergence where the semis haven't followed suit.

The semiconductors are a great barometer for information technology. The new cycle started in 2023, there was a big uptrend, and the chart now is showing distribution. What that means is that institutional investors are looking to reduce exposure. Over the last couple of months, we've been hugging this key level at the 40-week MA; on Monday, we moved below it.

So the S&P 500 made new highs this week, which might extend today, but we have this negative divergence where the semis haven't followed suit.

The S&P 500 made new highs this week, which might extend today. Big move higher by market leaders, but now those market leaders are breaking down. That suggests that we're approaching the end of the cycle.

Awesome compounder, strong uptrend. Only concern is that if we are, indeed, late cycle, infotech is going to be at risk. Don't put too much new $$ to work here. Wait for the bigger correction of a hefty 15-20%, likely later this year.

This name has a higher beta, and beta tells you how sensitive a stock is compared to the market.

As we get into the 4-year cycle reset, portfolio managers will rotate to the more boring areas of the market. Think staples, healthcare, and higher dividend payers. For the most part, managers need to be fully invested, so these areas are places to hide. Individual investors have the luxury of sitting in cash or looking at other instruments.

As we get into the latter stages of a correction, that's when you start seeing the baby being thrown out with the bathwater. So then you'll see utilities, really defensive staples, and healthcare being the better bid. A lot of those stocks will still go down, but if the market's down 20%, the defensive names might be down only 10%.

LMT has definitely done better over the last couple of years. BA is a bit of a recovery play here. In general, where we are in the cycle, he thinks we're in phase 2 but on the cusp of phase 3. Phase 2 is typically where materials, industrials, and technology continue to do well. 

These names should do OK, but we are approaching the end of the cycle. Ultimately, at some point, we'll see rotation out of these industrial plays.

LMT has definitely done better over the last couple of years. BA is a bit of a recovery play here. In general, where we are in the cycle, he thinks we're in phase 2 but on the cusp of phase 3. Phase 2 is typically where materials, industrials, and technology continue to do well. 

These names should do OK, but we are approaching the end of the cycle. Ultimately, at some point, we'll see rotation out of these industrial plays.

No. At a level of support around $20, a pretty strong move. Weak technicals, definitely in a downtrend, messy no-man's land. If we were earlier in the cycle, he'd support its trying to find a base here. Late cycle is big for energy; for airlines that aren't unhedged, that's going to be a big headwind as input costs come under pressure.

His team likes EIF, so take a look at that name.