BIG ALERT
The PMI print might have missed the mark today, but don't let the short-term noise distract you from the macro signal. If you're looking at the lagging data, you're already behind the trade.
The fundamentals are screaming a "catch-up" trade is coming. We’re still structurally bullish on PMI moving higher throughout the year. Here’s the alpha on why the expansion phase is just getting started:
The Macro Divergence
While the headline number underperformed, the leading indicators that actually drive industrial cycles are flashing green. We are seeing a classic "coiled spring" setup.
* Industrial Production Bottomed: IP is finally curling up after a period of stagnation. This is usually the first domino to fall before PMI rips.
* Durable Goods Strength: We’re seeing a steady climb in durable goods orders. Businesses are investing again, which translates directly into future manufacturing activity.
* The Liquidity Wave: Global M2 money supply is trending higher again. More liquidity in the system eventually finds its way into production and demand.
* Commodity Push: Commodity prices are starting to inch up. This reflects increasing demand for raw materials—a front-run on the manufacturing sector's recovery.
The Bottom Line
Historically, PMI has a high correlation with these four metrics. When they lead, PMI follows. We’re positioned for the "catch-up" effect sooner rather than later.
In crypto and macro alike, you want to buy the divergence, not the headline. The rotation back into growth is coming—stay positioned.