Inflation breakeven rates contracting is bullish signal for 2026: Renaissance Macro's deGraaf

Market Outlook - The charts indicate a bullish signal for stocks, driven by contracting real yields following recent inflation data [2][3] - A contraction in inflation is deemed more significant than growth, suggesting a positive trajectory for 2026 [3][4] Commodity Performance - Global metals, including aluminum, steel, copper, gold, silver, and palladium, are showing bullish breakouts, indicating improvement in global activity [6][7] - The bullish trend in metals is not limited to the U.S., with notable breakouts observed in China and Europe as well [7] Sector Analysis - The software sector has underperformed, with bearish signals confirmed recently, indicating a cautious approach towards these stocks [8][9] - In contrast, semiconductors are performing well and are seen as leaders in the tech space, presenting investment opportunities [9][10] - The market is characterized by a bifurcation, with both bullish and bearish charts present across various sectors, including discretionary, industrials, tech, and staples [10][11] Cryptocurrency Insights - Cryptocurrencies are under pressure, with Bitcoin being the strongest among them, although it has broken its qualitative uptrend line [12][13] - The current trend for Bitcoin is considered neutral to down, but excessive outflows from ETFs may set the stage for a potential year-end rally [14]