This is one of my favorite comparison chart and is a clean, simple way to show the intermarket relationships and how important the yield environment is for certain other markets.
Monday’s hard selloff was a jarring start to the New Year, but it didn’t do a lot of technical damage. Most importantly, the index held two levels. First, its low of 3663 matched a rising trendline in place since mid-November. (It began with the first pullback after the breakout to new highs.) Second, SPX managed to close slightly above 3700. While this...
Low interest rates and QE from central banks caused strong bullish trend across different assets. But what we see for the last few months is pullback on gold and US bonds, while stocks are printing new highs due to covid-19 vaccine that brings back optimism for move” back to normal life and economy” in 2021. However, stocks are very high and they may face a...
For over a month, the stock market has priced in a post-Covid reopening. Now there could be signs of that trend exhausting itself. First and foremost is the recent double-bottom on the iShares 20+ Year Bond ETF. We cited downside in this instrument twice as it hit the top of its channel. But it made a slightly higher low/double following the last drop. That could...
Ethereum had a bullish weekend. It pushed above the previous 2020 high of $489 on Friday morning and quickly proceeded above $500. It held its ground above that level and has continued upward through today. This is important because there’s no obvious resistance on ETHUSD before the May 2018 high of $832. That’s about 40 percent away. Meanwhile, Bitcoin is near...
Last week we cited the falling trendline in Apple. So far, it hasn’t broken out. Not surprisingly, this pattern appears in other key names like Facebook and Advanced Micro Devices. Most importantly, it’s also on the Nasdaq-100’s daily chart. The tech-heavy index has been fighting this downward trend for most of November. This morning it made an attempt to rally...
Quick little example of how to identify a trading opportunity using divergence in confluence with market structure and price action.
Housing stocks outperformed earlier this year thanks to low interest rates, an exodus from cities and tight inventories. They recently pulled back but could now be at support. The iShares US Home Construction ETF is sitting around the same $52 zone where it bounced in September and late October. ITB is also near its 100-day simple moving average (SMA), a line it...
If we learned anything in March, it’s that Bitcoin can be susceptible to selloffs in the broader market. However it’s been bucking that tide recently. This chart compares BTCUSD with the S&P 500. Notice how it’s advanced since October 12, while SPX has skidded lower over the same period. This pushed the 10-day correlation down to -0.7. That’s the lowest since...
Where we are, and "if-thens" Since the last week, the sentiment hasn't changed too dramatically, looking at the technical picture of DXY, I still see it as a range in a medium-term. Although, DXY crept down, closer to the "orange" line of defence (see the orange long-term trendline). Along with the stabilizing S&P500 index (The stock index has had the classic...
Breaking down through support, this is what kept me out of trading PFE to the long-side even though it looked bullish. With the elections coming up and democrats leading the polls, I'd stay away from pharma and insurers. Lean towards medical devices if you need healthcare exposure.
Technology stocks have undeniably led the market for several months. However the banks are showing signs of strength. JPMorgan Chase has been quietly making higher lows along its 50-day and 100-day simple moving averages (SMAs). That suggests its intermediate-term trend is at least neutral, and possibly nearing a bullish state. In and of itself, the chart is...
Still under the 2009 relative low, so no I'm not buying the whole rotation to financials theme just yet.
Hopefully, the full recovery of the market will be confirmed at 30K
As most people know, sentiment has been running uber-bearish. That’s lifted gold and depressed interest rates. But now the action in bond prices may be showing an end to the move. The iShares 20+ year Treasury Bond ETF tracks the prices of long-dated bonds. And they may have recently hit a peak around $172, near the same level where it was rejected in...
The S&P has broken relative highs. We have to go back to March for levels from above which it will test before retracing. The relative strength of stocks with respect to safe havens is not nearly as strong as measured by the Kovach OBV. Thus the break in intermarket correlations is suspect and we may anticipate a retracement soon. The next target would be...
The U.S. dollar has been sliding, with at least three major catalysts now weighing on the greenback: 1-Better economic numbers overseas, especially Chinese GDP last week 2-No QE boost from the European Central Bank last week, or the People’s Bank of China this week 3-A key stimulus deal by EU leaders this week Meanwhile back in the U.S., politicians are...
Good morning traders, Markets are slow because of holiday in the US, so we may not see any big changes in flows through the day. However, we should pay attention to BREXIT especially after latest Merkel comments, that they are preparing on every level for a no-deal Brexit. This cannot be positive for the euro or gbp, so be aware for a potential weakness on these...