Long-duration bonds continue to be one of the least attractive areas of the market, not just in the fixed income space. The iShares Barclays 20+ Year Treasury Bond ETF (TLT) broke down to new 52-week lows today with a move below $85. TLT has a near-zero fund score of 0.52 and has not held a fund score above 4.0 since 2020. TLT’s multi-year low is just a couple of boxes away at $83.50. While this may provide some support in the short term, there is not much positive technical evidence. TLT has been prone to quick rallies and sell-offs over the past few years. This has led to plenty of sideways action over the last few years but none of the rallies have led to a sustained trend. With TLT breaking to new 52-week lows, it’s another sign that long-duration bonds are a place to avoid.

On the other side of the yield curve, short duration bonds have a much better technical picture. The iShares Barclays 1-3 Year Treasury Bond ETF (SHY) has a fund of 2.93, just below the acceptable threshold of 3.0 but better than the average fixed income fund score of 2.43. SHY trades on two consecutive buy signals and is two boxes away from reaching its highest level since 2022. With short-duration bonds offering similar yields to long-duration bonds and possessing a better technical picture with lower volatility, they should make up the bulk of fixed income exposure at this time.

Internationals have been all the rage so far in 2025. As clients undoubtedly call in and ask you about how they are positioned to take advantage of their recent strength, there are pitfalls we need to be wary of that aren’t present in your run of the mill Dow stock. From geopolitical unrest, continuously evolving global tariff concerns, and currency relationships driving headlines every second of the day, remaining diligent in the face of market noise is mission critical on the global stage. Luckily, we can still use price action to guide our investment hand across the globe, utilizing outstanding trends to capture areas of relative strength. Said plainly, utilizing momentum can potentially help us find opportunities within our portfolio internationally.

Our first step in doing so will be looking at a “Relative Strength Spread” which calculates the dispersion between a basket of relative strength (RS) winners and losers. A wider spread can potentially lead to a wider performance dispersion, which may be beneficial for trend followers. The image below tracks said spread across the globe. While domestic spreads have rebounded quite nicely off of 2025 lows in early April, the real showstopper has been on the developed markets spread, which has marched higher (meaning a bigger spread between winners and losers) throughout the year. In layman’s terms, a wider spread can act as a tailwind for momentum based strategies.  

This wide spread has translated nicely into performance so far in 2025. Broad international representative ACWX is up roughly 14% this year, its third best start to a year through 5/18 since 1988 (including index data prior to fund inception.) Building on the strength of momentum on the developed international front, we can compare the performance for ACWX to that of the Invesco Nasdaq Dorsey Wright Developed Markets Momentum ETF PIZ, up nearly 20% so far in 2025. Breaking a spread triple top to close April, the fund has rallied up to new all-time highs with May’s action. While a ways away from traditional support on its default chart, the upside action has certainly been encouraging so far this year. PIZ also sits on a long-term RS buy signal against domestic benchmark SPXEWI, and has shown nice relative improvement against developed proxy EFA. Point being, international momentum (particularly on the developed front) has been strong, leading to productive showings for PIZ against other representatives on the global stage.  

Diving deeper into the security selection methodology behind PIZ, the fund selects a basket of roughly 100 “technical leaders” from a universe of stocks traded in developed markets around the globe. Evaluated on a quarterly basis, the fund will continuously gravitate to the highest relative strength options from said basket, tactically pinpointing names which have demonstrated the ability to best their peers. As of the last evaluation period at the end of Q1, PIZ was heavily weighted towards European representatives (and still is today.) The group accounted for nearly 60% of total allocation, with notable standouts from Germany, Switzerland & the United Kingdom. Underneath the hood of NDW’s DALI rankings, European representatives (both emerging and developed) have claimed the top two spots within the international rankings for over a year now, speaking to the consistency of broader leadership from the space. Japan & Canada are highlights outside of Europe, accounting for roughly 21% of total fund allocation at the end of Q1. From a sector perspective, PIZ is heavily weighted towards Financials & Industrials, also points of strength on the domestic front.

All this to say, the “momentum” of momentum on the developed markets front is quite strong as we move into June. While there are many forces in play on the world’s stage, utilizing price action alone is paramount to cut through the noise of trade, tariffs, and a weakening greenback. While trends can always shift, remaining tactical on the international front can certainly provide nice ammo for conversations as you enter into mid-year check-ups with clients on their portfolio’s performance so far in 2025.

Disclosures:

This article is intended for Financial Professional Use Only.

Management and other expenses can have a material impact on performance when compounded over time. Past performance, hypothetical or actual, does not guarantee future results. In all securities trading there is a potential for loss as well as profit. It should not be assumed that recommendations made in the future will be profitable or will equal the performance as shown.

Click here for more information from Invesco on the

Invesco Nasdaq Dorsey Wright Developed Markets Momentum ETF (PIZ): https://www.invesco.com/us/financial-products/etfs/product-detail?audienceType=Investor&ticker=PIZ

Dorsey, Wright & Associates, LLC is owned by Nasdaq, Inc. and we have affiliates who also provide financial services, research, information, and act as Brokers/Dealers to a wide variety of clients. Our affiliates use the information we create to create indexes, which are then used to create Exchange Traded Funds. These things create a potential conflict of interest in that we may have an incentive to promote or use the products and services of our affiliates and business partners. A number of Dorsey Wright representatives are registered with and hold securities licenses with the affiliate broker-dealers. In this capacity, they assist with the marketing and distribution of Exchange Traded Products.

Each week the analysts at NDW review and comment on all major asset classes in the global markets. Shown below is the summary or snapshot of the primary technical indicators we follow for multiple areas. Should there be changes mid-week we will certainly bring these to your attention via the report.

U.S. Sector Updates

The past week saw no significant technical developments in the Communication Services, Financials & Technology Sectors. Those that saw noteworthy movement are included below, in order of their relative strength ranking in the DALI domestic equity sector rankings, as of 5/21/25. Sector designations are based on DALI sector rankings and are as follows: 1 - 3 overweight, 4 - 7 equal weight, and 8 - 11 underweight.

Note that all Sector Updates can be found in the Research Hub under "Domestic Equities". Click here for more information about our newest research offering. This new view provides a much cleaner display for the Sector Commentary & Videos, while also allowing us to update the commentary any day. This report article will be phased out at the end of May, but the same timely commentary will continue to be available on the Research Hub.

Remember, these are technical comments only. Just as you must be aware of fundamental data for the stocks we recommend based on technical criteria in the report, so too must you be aware of important data regarding delivery, market moving government releases, and other factors that may influence commodity pricing. We try to limit our technical comments to the most actively traded contracts in advance of delivery, but some contracts trade actively right up to delivery while others taper off well in advance. Be sure you check your dates before trading these contracts. For questions regarding this section or additional coverage of commodities email james.west@nasdaq.com.

Data represented in the table below is through 05/21/25:

Broad Market Commodities Report

Portfolio View - Commodity Indices

Cryptocurrency Update

Cryptocurrency Video (2:35)

Daily Option Ideas for May 21, 2025