Trend Following - Week in Review - August 22 , 2025

"Fragile Floor, Outliers Roar"

This Week in Trend – 22 August 2025

Welcome back to This Week in Trend, your weekly pulse check on global futures and the state of systematic trend following.

The TTU Trend Barometer ticked slightly higher to 32 percent, still firmly in “weak” territory. Beneath the fragile surface, however, a handful of markets roared — coffee, cattle, crude oil, and small caps each delivered outsized trends. Bonds and precious metals provided steady ballast, while natural gas, rice, and cocoa collapsed. This was not a week of broad participation, but one where outliers again wrote the story.

SG Trend Index Performance

• Month-to-date (as of Aug 22): +1.74%
• Year-to-date: -8.46%
  (Previous week: +1.81% MTD | -8.39% YTD)

The SG Trend Index dipped slightly versus last week’s pace but stayed positive for August. The YTD drag remains heavy, yet strong softs, cattle, and US equities are lifting returns at the margin.

TTU Trend Barometer

• Current reading: 32 percent – Moderately Weak
• Previous reading: 27 percent
• 10-day rate of change: Rising weakly

At just 32 percent, fewer than a third of markets show medium-to-strong trend strength. The backdrop is fragile. Yet, the week proved that even from weak foundations, runaway outliers can still dominate portfolios.

“At thirty two, the floor may be fragile — but the roar of outliers shakes the market.”

The Top Traders Unplugged (TTU) Trend Barometer is a proprietary tool that measures the percentage of markets with medium to strong trends. Similar to a thermometer, where 0 degrees Celsius equates to freezing, a TTU Trend Barometer reading below 40% indicates a “cold” environment for trend-following, while readings above 55% signal a “hotter,” more favourable trend environment.

Weekly Asset Class Snapshot

Source: Finwiz.com

Asset Class Breakdown – Reversals and Continuations

• Meats: +3.05% – Cattle remain textbook trends, hogs rebounded.
• Metals: +1.20% – Gold, silver, palladium all advanced; copper stabilized after prior volatility.
• Energy: +0.80% – Crude oil and products steadied; nat gas collapsed.
• Soft Commodities: +0.96% – Coffee surged again; cocoa and lumber dragged.
• Equities: +0.50% – US benchmarks advanced; Russell 2000 led.
• Bonds: +0.44% – Bid tone across the curve.
• Grains: -0.51% – Soybeans and oil higher, wheat and oats weak.
• Currencies: -0.12% – USD eased, majors firmed.
• Crypto: 0.00% – Bitcoin paused near highs.
• Volatility Index: -8.30% – VIX crushed again, easing risk backdrop.

Performance Highlights – This Week’s Market Leaders & Laggards

Top Market Movers

Top Gainers

• Coffee: +13.11% – Explosive follow-through, week’s alpha driver
• Feeder Cattle: +4.75% – Persistent strength
• Gasoline RBOB: +4.15% – Product-led rebound
• Heating Oil: +3.78% – Supported energy complex
• Russell 2000: +3.39% – Small caps shine

Top Losers

• Natural Gas: -10.8% – Collapse accelerates
• Rough Rice: -8.65% – Heavy downside continuation
• VIX: -8.3% – Volatility crushed
• Cocoa: -5.39% – Sharp reversal
• Oats: -2.38% – Weakness persists

Portfolio View - Positioning and Impact

• Energy: Long crude and products supported gains, while nat gas shorts delivered strongly.
• Metals: Gold, silver, palladium trends reinforced long allocations; copper calmed.
• Grains: Soybeans and oil pulled portfolios higher despite weakness in wheat, oats, and rice.
• Softs: Coffee dominated returns, cocoa a notable drag.
• Meats: Clean long trends in cattle remain portfolio leaders.
• Bonds: Modest, steady gains reinforced diversification.
• Equities: US markets, particularly Russell 2000, boosted long-side exposure.
• Currencies: Dollar weakness opened space for majors, though without conviction shifts.
• Crypto: Bitcoin paused, trend structure intact.
• Volatility: VIX collapse reduces breakout payoff but supports risk assets.

Final Reflections – Outliers Carry the Fragile Floor

This week was another study in contrasts. The Trend Barometer insists the floor is fragile. But above those cracks, coffee roared higher, cattle drove strong gains, and small caps surged. Bonds and metals offered quiet reinforcement. Nat gas, rice, and cocoa showed the other side of dispersion.

For trend followers, the lesson is timeless: robust portfolios thrive not by capturing every move, but by catching the few runaway outliers that roar loudest.

 

 

 

List of Resources used in the Week in Review

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