Two lookback windows locate the cycle across bonds, stocks, and commodities

Treat the stage label as a hypothesis

In editorial terms, a named cycle stage is a hypothesis, not a finished reading. Market-regime-classification has to survive a two-window relative-strength-index on the same bonds, equities, and commodities. If the one-year ranking and the three-month ranking disagree, the live regime is unresolved.

Intermarket-analysis is the habit of reading those three markets together so one market is placed in a rotating expansion or contraction sequence instead of being judged in isolation. The relative-strength-index is the defined-lookback comparison that shows which market led, lagged, or declined over the sampled interval.

The textbook lead-lag-sequence

Textbook intermarket-analysis has bonds turning ahead of equities and equities turning ahead of commodities on both advances and declines. That order is the lead-lag-sequence.

The stylized cycle is organized as six successive stages that shift accumulation from bonds to equities to commodities and then reverse that order on the way down.

Early-cycle stages are described as a still-contracting economy in which a confirmed bond low is the first rotation, followed by an economic low with equities beginning to follow bonds higher. Mid-cycle stage three is described as a joint advance in bonds, equities, and commodities as expansion continues and inflation starts to appear.

Later stages pair rising policy rates with softer bond prices, then a peak in expansion that the textbook map treats as an argument for reducing equities while commodities are the last class to roll over.

A historical tally of peak-to-peak cycles found an average length measured in several years, with observed cycles ranging from a little over one year to more than a decade.

A one-year window and a three-month window disagreed

The case study treated the stylized six-stage map as incomplete for live market-regime-classification because individual cycles differ and because housing, banking, stimulus, debt, and demographic shocks sit outside the textbook diagram.

Over a one-year relative-strength-index, long-duration domestic bonds led, developed equities trailed that lead, and commodities together with commodity-linked emerging equities were the weakest group. That year-long ranking pointed to a stage-two reading.

The same cross-asset set over a three-month relative-strength-index showed only bonds advancing and equities flat. That shorter window produced a stage-one reading that conflicted with the year-long stage-two reading and with a multi-year equity advance already under way.

In editorial terms, neither window is allowed to cancel the other. A stage-conflict means the live regime stays unresolved until the two relative-strength-index rankings agree.

The policy-overlay is part of the classification

A third classification treated prolonged near-zero policy rates and repeated easing as a possible frozen regime, with later easing episodes described as delivering a smaller equity response than earlier ones in the same sequence.

The policy-overlay is persistent near-zero rates and repeated stimulus that can mute or freeze the usual rotation among the three asset classes. In editorial terms, that overlay belongs inside market-regime-classification rather than beside it. A stage call that cites the lead-lag-sequence but parks policy in a footnote is not a complete reading.