Every month, I publish this monthly asset class report not to predict the future, but to show you exactly where we are right now. 

The charts are simple candlesticks, with the 50-day (10-week) and 200-day (40-week) moving averages. At the end, I present a couple of performance charts to illustrate the relative trading positions of traditional asset classes and cryptocurrencies.

If you’re a new subscriber, please email feedback@rudeawakening.info with any questions, comments, or concerns. Our mailbag is lively, and I try to publish reader feedback at least once a month. Enjoy!

Ok, crypto and oil had a rough month. And yes, the 10-year yield and the almighty dollar are moving in the wrong direction.

However, equity, debt, real estate, and even metals had a strong October.

The SPX, Nazzie, Russell 2000, gold, and silver all notched monthly all-time closing highs. 

Will oil ever recover? Is this the end of the crypto rally?

Let’s get to the charts and find out.

S&P 500

***NEW MONTHLY CLOSING HIGH OF 6,840.20***

The first and last weeks of October were rough. But the middle was a sustained rally that took us to a new monthly closing high.

If my friend and colleague Enrique Abeyta is right, this is only the beginning, as we’re in the best performing period of the year. Let’s hope history repeats.

My only caution is that last week’s attempted rally was rejected pretty hard.

Nasdaq Composite

***NEW MONTHLY CLOSING HIGH OF 23,794.26***

Another nice rally for the Nasdaq last month. The target remains 26,285—only a couple of thousand points to go. 

Russell 2000 (Small caps)

***NEW MONTHLY CLOSING HIGH OF 246.23***

The Russell 2000 clocked a 1.54% return in October.

The upside target remains 310.

The US 10-Year Yield

Jerome Powell cut again. But a last-second rally bumped the 10-year up to 4.08%. It spent much of the last month below 4%. I reckon the USG and the Fed will continue to push yields in any way they can… foul or fair… naturally or artificially.

Dollar Index

The dollar unexpectedly rallied two points last month, much to the anger of the White House. I don’t expect this trend to continue. But the markets have a habit of strongarming even the most stubborn governments.

USG Bonds

Despite last week’s sell-off, the TLT rallied most of last month. I wouldn’t touch bonds with a barge pole, but I’m not the market.

Investment Grade Bonds

Admittedly, this chart looks excellent, as well. From here, the next target is 116.50, before looking at 133.20. I don’t buy the story in the long term.

High Yield Bonds

From two months ago:

I'm not sure if HYG can go much higher. Stalled at these nosebleed levels, a turnaround may be in order soon.

Same as it’s been for a while.

Real Estate

VNQ took its lumps this month. Despite still having a target of 100, the uptrend is giving way to volatility.

Energy: West Texas Intermediate (Oil)

This pathetic chart provides the White House with considerable cover to cut rates and weaken the dollar. If oil were more uppity, surely that’d constrain The Donald.

Base Metals: Copper

Copper’s rally is real, and it’s spectacular. We’re right on target for $5.29. Let’s see where the cards lie after hitting there.

Precious Metals: Gold

***NEW MONTHLY CLOSING HIGH OF 3,997.10***

Despite the awful selloff of the last two weeks, gold still printed its highest monthly closing price ever. These blow-off rallies can resolve in two ways: by price or by time. If by price, we’ll see $3,600. If by time, it may take a month or two before we reclaim the intramonth high of $4,381.

Precious Metals: Silver

***NEW MONTHLY CLOSING HIGH OF 48.65***

We actually hit $54.46 intraday last month before the big sell-off. And silver recovered nicely the previous week already.

Give it a few weeks before we finally surmount that $54.50 level.

Cryptos: Bitcoin

Cryptos: Ether

Ether had a temporary rally, but it’s now trading below $3,800. We’re now looking at 3,089 for a downside target.

Trad Asset Class Summary

Crypto Class Summary

Monero was the only cryptocurrency in the black this month, finishing up by 7.08%. Bitcoin and Bitcoin Cash were down 7.68% and 9.70%, respectively. All else was down by double digits. 

Wrap Up

Cryptocurrencies had a particularly challenging month, while traditional assets, such as stocks and bonds, performed relatively well. And despite a wobbly two weeks, gold and silver still closed at all-time highs.

All three equity indexes we cover hit all-time monthly highs in October.

Welcome to the most joyless bull market ever.

Finally, let us laugh, courtesy of the X-verse:

We even do this in Italy… all the time!