The best part of looking at performance is that more the coverage the better the identification, isolation and interpretation of performance gets. We have increased our global coverage yet again. Now we are tracking all the S&P 500, top commodities, top currencies, top global indices and some emerging market assets.

Looking at such a cross section of assets technically could be tiring. But again even if we can't chart such a large universe, we need systems to filter out potential outperformers from underperformers. We have mentioned on prior occasions the performance is cyclical. If we assume that this premise is true, life becomes easy for a technician. She (he) already knows his technical short list of assets.

Today we will be reviewing some of the performance Rieki cycles. We have carried nine global Rieki cycles. Four are topping, four are bottoming and one is mid way. Topping and bottoming Rieki like topping and bottoming price structures are easy to understand, it's the one that's in the middle which is hard to comprehend. Guess what's neutral and mid way? Russell 1000, the American broad market is far from the extreme performance. So if you were thinking that the confusion about the US market trend is going to sort out soon, you might be surprised how much more non clarity lies ahead of us.

This is why to jump on to sell when the asset (or index) is in neutral territory, could just be inefficient use of time and money. Is our task not about maximizing returns? We are sure that even if we scale up systems to 10,000 global assets, we may still not be maximizing returns (opportunities). But atleast we would be reducing risk. Isn’t that the whole idea? Does reducing portfolio risk not increase returns per unit risk?

Coming back to the four topping Rieki's. Silver, Copper, Apple and Ford are the top performers. One may assume that gold will always have bulls, Apple will always sell iphones, copper will continue to take us to prosperity and Ford will drive the US auto sector. But then like we said it's not about how much more Apple can innovate. It's about the price we pay for that innovation. Shanghai, Bovespa, Cisco and VIX are bottoming and oversold and offer more value for investments at this stage. Bovespa at the bottoming Rieki does not make an encouraging case for Commodity Bears. Historical lows on VIX do not make an exciting case for market complacency. It's a tough market picture out there. Let's give it another week and revisit the global seasonalities.

Mukul Pal, CMT, Orpheus Capitals, Global Alternative Research