Intermarket Analysis
Categories: Accounting, Metrics
If you’re one of those nerdy investors—bravo to you. But also...you’re probably into technical analysis. And if you’re into technical analysis, you’re probably gushing over intermarket analysis.
Intermarket analysis is a type of technical analysis that examines the relationships between stocks, bonds, commodities, and currencies in an attempt to pinpoint where we are in the business cycle, and thus forecast stock market movements.
The idea behind intermarket analysis is how several factors that are correlated together (or not) might be more enlightening than analyzing one factor in a silo. Since intermarket analysis is also a type of fundamental analysis, that means it’s less of a horse-race-watching tool and more of a long-view, general-direction tool for investors.