Trend Following - Week in Review - August 15, 2025

"Weak Tide, Big Waves"

This Week in Trend – 15 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 fell further into ‘very weak’ territory. Yet this masked a week of standout trends. Coffee exploded higher, soybeans joined the rally, and equities pushed on with renewed strength. Metals and energy struggled, bonds gave back ground, but cattle markets trended beautifully. Volatility collapsed again, cushioning risk and fuelling selective moves.

SG Trend Index Performance

• Month-to-date (as of Aug 15): +1.81%
• Year-to-date: -8.39%

(Previous week MTD: +1.05% | YTD: -9.08%)

The SG Trend Index added to its gains this month, though year-to-date performance remains firmly in the red. Strength in softs and equities is providing the ballast that steadies the index.

TTU Trend Barometer: 27 Percent – Very Weak

• Previous reading: 34 Percent
• 10-day rate of change: Falling weakly

At just 27 percent, fewer than a third of markets show medium-to-strong trends. This is a fragile backdrop. Yet this week proved that when outliers take hold, they can dominate returns.

"At twenty-seven, the tide is out — but trend surfers still caught big waves."

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

Soft commodities delivered outsized gains, equities pushed higher across major benchmarks, and cattle markets trended cleanly. Metals and energy softened, bonds eased, and currencies churned with little direction. Crypto posted small gains, while volatility continued its steep collapse.

Asset Class Breakdown – Reversals and Continuations

• Energy: -1.06% – Brent and gasoline dragged, but natural gas rebounded modestly. Crude remains locked in a choppy downtrend.
• Metals: -1.22% – Gold pulled back, palladium sold off hard, while platinum and copper held near recent levels after sharp reversals.
• Equities: +1.57% – Global indexes advanced. Nikkei and Russell 2000 showed renewed momentum, Nasdaq cooled but held trend.
• Soft Commodities: +2.67% – Coffee broke out spectacularly, soybeans and cocoa joined the move, OJ extended its rebound.
• Grains: +0.67% – Soybeans rallied sharply, corn and wheat added support, rice lagged.
• Meats: +1.15% – Live cattle and feeder cattle remain picture-perfect uptrends, lean hogs recovered.
• Bonds: -0.25% – Pullback across the curve, momentum softer but structure intact.
• Currencies: -0.04% – A flat week, with mild USD softness offset by scattered FX flows.
• Crypto: +0.56% – Bitcoin slipped slightly but broader crypto resilience preserved trend bias.
• Volatility Index: -6.04% – VIX collapse extended, removing stress from risk markets.

Performance Highlights – This Week’s Market Leaders & Laggards

Top Market Movers

Top Gainers

• Coffee: +11.13% – Parabolic breakout, clear leader of the week
• Soybeans: +5.68% – Strong agricultural follow-through
• Orange Juice: +5.16% – Recovery intact
• Cocoa: +3.80% – Adding breadth to softs
• Nikkei 225: +2.60% – Asian equities remain firm

Top Losers

• Lumber: -6.44% – Persistent weakness in softs
• VIX: -6.04% – Volatility collapse resumes
• Gold: -3.14% – Precious metals correction
• Palladium: -2.40% – Extending reversal from highs
• Natural Gas: -2.24% – Energy trend under pressure

Portfolio View - Positioning and Impact

• Energy: Systems remain short oil and gas, though chop reduces conviction.
• Metals: Mixed signals. Gold and palladium weakness cut longs, while silver held firm.
• Grains: Soybeans and corn strength triggered fresh long exposure.
• Softs: Coffee’s surge was the week’s alpha driver, joined by cocoa and OJ. Lumber remained a drag.
• Equities: Broad gains reinforce long bias, with Nikkei and Russell offering clean structures.
• Bonds: Modest losses across the curve; long-side exposure still present but weakening.
• Currencies: Flat week, systems unlikely to shift materially.
• Crypto: Bitcoin consolidating near highs, uptrend intact.
• Volatility: Further VIX collapse may reduce breakout payoffs but strengthens equity structure.

Final Reflections – Outliers Dominate the Weak Tide

This was a week of contrast. The TTU Trend Barometer’s plunge to 27 percent suggests fragility, yet coffee’s rally, soybean strength, and equity gains underline the power of outliers. Broad participation may be absent, but concentrated moves still shape performance. The lesson is clear: robust portfolios thrive by catching the few runaway trends, not by leaning on the many.

 

 

 

 

List of Resources used in the Week in Review

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