The ratio of commodity countries to tech countries has hit historic support lows, and the four-year cycle rotation window has quietly opened.
A global asset allocation signal worth keeping a close eye on: the ratio of the commodity country index to the tech country index has fallen to 0.479, nearing the critical historical support zone established at the pandemic's bottom in 2020. That same support level in 2020 triggered a nearly two-year bullish reversal for commodity countries, leading to the onset of a supercycle for commodities.
The tech country index (including the US, Taiwan, South Korea, China, etc.) has currently reached a historic high of 77.50, with its strong dominance over the past four years pushing valuations to record levels; meanwhile, the commodity country index (including Australia, Brazil, Canada, Saudi Arabia, etc.) is forming a rounded bottom pattern on the technical charts after plummeting due to tariff shocks in March 2026, awaiting a confirmation breakout.
However, the rotation signal still requires validation. The tech country index continuously hitting new highs indicates that the bullish trend is not yet over, and the neckline of the rounded bottom has yet to be broken, making a full switch risky. For global allocation investors, the optimal strategy now is to gradually reduce exposure to overvalued tech countries and build positions in batches after the commodity countries confirm their technical breakout—historical patterns show that once these cyclical rotations start, they often last for more than two years, with favorable odds.
A global asset allocation signal worth keeping a close eye on: the ratio of the commodity country index to the tech country index has fallen to 0.479, nearing the critical historical support zone established at the pandemic's bottom in 2020. That same support level in 2020 triggered a nearly two-year bullish reversal for commodity countries, leading to the onset of a supercycle for commodities.
The tech country index (including the US, Taiwan, South Korea, China, etc.) has currently reached a historic high of 77.50, with its strong dominance over the past four years pushing valuations to record levels; meanwhile, the commodity country index (including Australia, Brazil, Canada, Saudi Arabia, etc.) is forming a rounded bottom pattern on the technical charts after plummeting due to tariff shocks in March 2026, awaiting a confirmation breakout.
However, the rotation signal still requires validation. The tech country index continuously hitting new highs indicates that the bullish trend is not yet over, and the neckline of the rounded bottom has yet to be broken, making a full switch risky. For global allocation investors, the optimal strategy now is to gradually reduce exposure to overvalued tech countries and build positions in batches after the commodity countries confirm their technical breakout—historical patterns show that once these cyclical rotations start, they often last for more than two years, with favorable odds.
