Deteriorating Cyclical and Technical readings pushed the Leuthold Major Trend Index down to Neutral last week, as escalating conflict in the Middle East with the Strait of Hormuz effectively closed and regional energy infrastructure under attack drove a 36% spike in crude prices and raised the specter of a significant global oil shock. With inflation pressures surfacing, bond yields backing up, and small-cap indexes shedding 5% while breadth narrows, net equity exposure in Leuthold tactical accounts was trimmed from 56% to 51% through a combination of reduced long positions and added shorts.
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