“The environment firmed not because markets rose, but because they stopped diverging.”
Trend Following Weekly Report
A hotter-than-expected May jobs report landed on Friday and turned a quiet tape into a broad risk-off reversal. With payrolls well above forecast and unemployment holding steady, market pricing swung toward a Federal Reserve that may now raise rates rather than cut. Treasury yields rose, the dollar reversed higher back above one hundred, and a semiconductor and artificial-intelligence selloff that had built midweek accelerated into the close. Equity indices fell more than two percent on average, the Nasdaq dropping over four and a half percent on the week in the worst session for US technology since April 2025. Precious metals broke down hard, with silver off almost nine percent and gold sliding to its lowest level of the year, while bitcoin extended a week-long unwind to lose close to seventeen percent. Only the petroleum complex and the cattle market closed higher.
For trend followers, the more telling story sits in the indicators. The TTU Trend Barometer recovered from thirty-two percent to forty-three percent, stepping back out of Moderately Weak and into Neutral, with its rate of change flipping from Falling Rapidly to Rising Weakly. That improvement did not arrive because markets rose. It arrived because they moved together. The barometer measures the share of markets in medium-to-strong trends in either direction, so a broad, synchronised move to the downside lifts it just as a broad rally would. Where late May saw sectors fracture into two-way splits, a single macro catalyst this week pulled market after market the same way, and the SG Trend Index gained about one and a third percent on the back of it.
The read for positioning is straightforward: the steadier opportunity now sits on the short side of the complexes that broke down, with the sharp equity reversal the open question heading into next week.
Top Movers (Up): VIX, Crude Oil WTI, Lumber Top Movers (Down): Bitcoin, Oats, Silver
Want the theoretical foundation for why trend following works?
The Fractals of Finance: Determinism, Adaptation and the Geometry of Markets bridges complexity science with practical trading implementation. With a foreword by Jerry Parker, original Turtle Trader.
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Want a practical field manual for trading trends and capturing outliers?
The Aussie Turtles Trend Following Guide: A Field Manual for Hunting Outliers adapts the timeless principles of the original Turtle traders into a systematic, rules-based approach for modern markets. Co-authored with Adam Havryliv.
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