Broad risk-on, but duration remains the constraint

The Risk Appetite Index stands at 77, in Extreme Greed, while the Business Cycle Clock remains in Expansion. S&P 500 breadth is broad — 72.1% above the 200DMA and 69.1% above the 50DMA — and internals confirm participation. The WPI, however, shows a long-term structure stronger than the short-term: 72% LT versus 65% ST. The key divergence remains fixed income: TLT bounces on the week but stays weak over one and three months, and the WPI's bond sleeve remains in Q3 on both LT and ST.

1. Intermarket Analysis · Murphy's 4 Pillars

The reading begins with the four macro asset classes. The observed combination is unambiguous: stocks strong, bonds still fragile, commodities in a weekly correction but not uniformly weak, dollar sideways/soft. It is this configuration that defines the cross-asset picture for W32.

2. Weekly Overview

The overall picture is risk-friendly, but the Canary filter prevents the market from being read as fully synchronised. The distinction matters: volatility, credit and breadth signal no stress, while the problem remains concentrated in the rates/duration bloc.

3. Market Regime

The original panel has been separated into the three modules that compose the regime, so as to preserve readability and analytical function.

Regime sub-indicators

Reading: sentiment and participation are clearly constructive, while the Canary maintains a cautious filter. The fact that credit and VIX remain benign reduces the probability that the caution signals systemic stress; the configuration is more consistent with a rates and duration constraint.

4. Global Indices

The week is broadly positive: Nasdaq 100 +5.09%, Nikkei 225 +4.88%, KOSPI +5.72%, Russell 2000 +3.56%, S&P 500 +3.51%, Euro Stoxx 50 +2.87% and DAX +2.73%. The CSI 300 is the exception at -0.90% 1W. The KOSPI also stands out for the +70.84% YTD shown by the platform: an exceptional return, which should nonetheless be distinguished from its relative positioning within the rotational monitor.

5. Country Monitor · Geographic Rotations

The rotational maps are presented individually, at full width, to render trajectories and relative positioning legible. The quadrant position should be read in conjunction with the direction of the arrow and not as a simple performance ranking.

The geographic reading therefore confirms a broad but selective risk-on environment. China remains the most notable laggard in the global index panel; South Korea, despite very strong absolute performance, does not exhibit equally consolidated relative leadership in the monitor.

6. US Yield Curve

The shape of the curve signals no inversion. The intermarket takeaway is therefore not a recessionary curve, but rather the level and duration pressure: TLT remains below its moving averages and the bond sleeve of the WPI remains weak.

7. Breadth and WPI

Breadth confirms the quality of the rally: 72.1% above the 200DMA, 69.1% above the 50DMA, A/D ratio of 1.82 with 323 advancing against 177 declining and 39 new highs against 4 new lows. The WPI — Wyckoff Position Index is 72% Strong over the long term with 12/19 instruments in Q1, and 65% Moderate over the short term with 9/19 in Q1. The structure therefore remains stronger than the tactical impulse. Financials, Healthcare and Industrials exhibit robust breadth; Utilities is the most evident weak point, while Real Estate shows a significant LT/ST divergence.

8. USA Sector Rotation

Leadership is not concentrated in a single sector. Technology, Financials, Healthcare, Industrials, Consumer Staples and Basic Materials are in the Strong zone; Consumer Discretionary and Communication Services are in Improving. Utilities remains Weak, while Energy and Real Estate show a less robust tactical reading. Sector rotation is therefore consistent with a broad risk-on environment, but with internal dispersion and differentiated rate sensitivity.

9. FX Rotation

UUP is -0.35% on the week and -1.02% over one month, while still holding +2.41% over three months. The cross-rate map remains mixed: GBPUSD and NZDUSD are in the Strong half, EURUSD and AUDUSD in Improving, while USDJPY is in the Weak zone. The dollar is therefore not imposing a uniform financial tightening in W32.

10. Commodities · Internal Rotation

DBC loses -1.83% on the week but holds +4.82% over one month. The aggregate figure is insufficient: the commodity complex is highly dispersed and must be read by sub-group.

Precious: selective leadership, with gold and silver not perfectly synchronised in the near term. Industrial metals: copper remains in the Strong zone, while nickel and other metals show greater weakness. Softs: sugar, cotton, coffee and cocoa maintain relatively strong positions, while orange juice and lumber are weak. Energy: the complex is predominantly Weak, with Heating Oil as a relative exception. The message is therefore one of internal rotation rather than uniform commodity beta.

11. Bonds · The Duration Constraint

Fixed income remains the primary anomaly relative to equity risk-on. TLT's weekly recovery does not alter the one- and three-month structure and does not change the positioning of the bond sleeve in the WPI. With credit stable and the VIX low, the risk does not appear to be one of funding or credit: it is principally a matter of duration and cost of capital.

12. Transmission Channels

13. Risks and Catalysts

Key risks and signals to monitor

Primary risk: renewed pressure on the long end capable of keeping the bond bloc weak and beginning to erode breadth at the 50-DMA. Secondary risk: further deterioration of WPI ST from the current 65%. Favourable signal: the Canary exiting Caution with credit and volatility still benign. Geographic divergence: China weak and Korea very strong in absolute performance, but less convincing in relative leadership.

14. Weekly Focus

The key question to assess is whether risk-on can become more synchronised. The checkpoints are: breadth holding above the 50-DMA, WPI ST behaviour, the trajectory of the long end and bond proxies, the evolution of the Canary/TIP, and the direction of the dollar. As long as credit and volatility remain benign and participation does not deteriorate, the regime stays constructive; a new leg of duration weakness accompanied by a deterioration in breadth would, however, alter the quality of the overall picture.