Markets discount the future, so if the Fed tells the market it's going to raise rates, it goes ahead and raises them anyway. Why wait on the railroad tracks when you know a train is coming? Ironically, the widely-telegraphed rate rise has arrived at a time when bond... READ MORE
In October 2021, we made the case for a new secular commodity bull marketand concluded that this environment would likely spill back into the economy and stock market. That process is already underway, as the NASDAQ Composite was recently down 20% from its high, compared to a drop of 12%... READ MORE
Changing relationships between differing asset classes and markets do not speak that often. When they do, strong evidence that important changes may be afoot is often provided. One of the characteristics that has caught my attention since the beginning of the year is that, on one side, stocks been reacting... READ MORE
I've been bearish on the NASDAQ -- or, more specifically, on its relative action against the S&P Composite -- for about a year. Now that the financial press has announced that the Index, by virtue of passing the somehow magic -20% level, has "entered bear... READ MORE
The Business Cycle and Sector Rotation The business cycle undergoes a set series of chronological events which are also related to primary trend peaks in bonds stocks and commodities, as laid out in Figure 1. You can read about this concept in greater detail here. Based on the position of... READ MORE
Chart 1 shows that, starting in early 2020, stocks began to slowly but quietly underperform commodities. Since the start of this year, though, this trend has begun to really accelerate on the downside, i.e. moving in favor of commodities. The center window also shows that, when a lengthy trendline... READ MORE
Chart 1 shows that, starting in early 2020, stocks began to slowly but quietly underperform commodities. Since the start of this year, though, this trend has begun to really accelerate on the downside, i.e. moving in favor of commodities. The center window also shows when a lengthy trendline of... READ MORE
In a recent late January article,I pointed out that many market averages had fallen to key support levels at a time when a lot of them were experiencing selling climaxes. This kind of condition is usually followed by a rally or basing period, but I also noted that other... READ MORE
Since its August 2020 high, gold has been a very tricky market to call. Let me put it another way; it has been easy to call, but exasperatingly difficult to call correctly because of the numerous false breakouts that have taken place in the last 18 months-or-so. Monday's... READ MORE
Before we look at the two-bar reversal, let's first review the long-term technical position for the Dollar Index. It's laid out on a quarterly basis in Chart 1, along with a Coppock momentum indicator. The first thing to note is that the Index is positioned below... READ MORE
Before we look at the two-bar reversal, let's first review the long-term technical position for the Dollar Index. It's laid out on a quarterly basis in Chart 1, along with a Coppock momentum indicator. The first thing to note is that the Index is positioned below... READ MORE
Usually, when we are identifying one or two bar price patterns or candlesticks, it's because they appear close to a turning point, thereby giving us a trading edge. From a practical point of view, it makes sense to observe daily or intraday price action. That's because... READ MORE
I am a great believer in the principle of false breaks being followed by above-average moves in the opposite direction to the break. It happens because those who bought on it are caught on the wrong side of the market and are forced to re-position themselves, just as correctly positioned... READ MORE
Recently, I have been drawn to two specific-but-unrelated areas of market activity. Both are experiencing an extremely fine balance between buyers and sellers and, as a result, are likely to experience a big move in one direction or the other. These are the copper price and small cap stocks. Let&... READ MORE
Technology outperformed throughout the second decade of this century, but the times they are a-changin', as it is obvious that this sector has lost enough mojo in the last year to indicate that a basic transformation in market leadership is underway. Just to be clear, I am not saying... READ MORE
Technology outperformed throughout the second decade of this century, but the times they are a-changin', as it is clear that this sector has lost enough mojo in the last year to indicate that a basic transformation in market leadership is underway. Just to be clear, I am not saying... READ MORE
I had thought that rates would moderate a little at the beginning of 2022, as the economic growth rate slowed due to COVID and other factors. Not so, as yields across the spectrum have resumed their bull market rally in anticipation of higher inflation and a less accommodative central bank.... READ MORE
Last week, I pointed out three charts that had triggered bullish signals and suggested that these characteristics were strong enough to power the market higher. Prices immediately sold off, but have subsequently rebounded. Since those charts are still positive, I am sticking to the higher market over the next 2-4... READ MORE
Last week, I pointed out three charts that had triggered bullish signals and suggested that these characteristics were strong enough to power the market higher. Prices immediately sold off, but have subsequently rebounded. Since those charts are still positive, I am sticking to the higher market over the next 2-4... READ MORE
A lot of indicators, such as the percentage of NYSE stocks above their 200-day MA and the NYSE bullish percentage, remain in confirmed downtrends that will take time to reverse. However, some of the shorter-term charts that have proved reliable in the past have just begun to offer some bullish... READ MORE
The copper price is reputed to have a "Ph.D. in economics" because of its ability to predict turning points in the global economy. That role is justified due to copper's widespread use in most sectors of the economy, from homes and factories to electronics, power... READ MORE
According to CoinGecko, total crypto market capitalization, which came from almost nothing 10 years ago, stood at $3 trillion in early November. To put that in perspective, total US GDP currently stands at $23 trillion, so, at its recent high, global crypto was worth 13% of US GDP and more... READ MORE
Thursday's action was quite positive for several sectors, as they experienced positive two-day price formations. These patterns are only of a short-term nature and usually have an effect for between 5 and 10 days, so they do not represent major signals. However, since this action is coming off... READ MORE
Thursday's action was quite positive for several sectors, as they experienced positive two-day price formations. These patterns are only of a short-term nature and usually have an effect for between 5- and 10-days, so they do not represent major signals. However, since this action is coming off an... READ MORE
One piece of Monday's market action that really stood out to me was a bearish outside day in the NASDAQ, as shown in Chart 1. A classic outside day develops after a persistent short-term rally and signals a short-term reversal in sentiment. The outside part refers to the... READ MORE
The Invesco DB Agricultural Fund (DBA) consists of grains (37%), softs (sugar, coffee and cocoa; 35%) and livestock (24%). A small allocation is also given to cotton. Chart 1 shows that this ETF began a bull market back in the spring of last year. Late 2020 also saw it break... READ MORE
The gold price zig-zagged its way down between August of last year and April of this one. Since then, it's really been in a trading range and now looks as if it is breaking out. I'll start off by taking a look at the longer-term picture.... READ MORE
The gold price zig-zagged its way down between August of last year and April of this one. Since then, it's really been in a trading range and now looks poised to break out. Whether it will or not is another question that only the market can decide. I&... READ MORE
The major averages have recently been scoring new highs for the year, strongly hinting that the post-May correction has run its course. So where do we go from here? Is the market overbought and likely to digest recent gains, or is a rally into the bullish year-end period a better... READ MORE
Sometimes, when I mess around with the charts, I discover an entirely new approach that I had not thought of before. Last week saw one of those breakthrough moments when, for the first time ever, I applied the Special K to hourly charts and came up with some interesting results.... READ MORE
Sometimes, when I mess around with the charts, I discover an entirely new approach that I had not thought of before. Last week saw one of those breakthrough moments when, for the first time ever, I applied the Special K to hourly charts and came up with some interesting results.... READ MORE
The business cycle undergoes a set series of chronological sequences, just like the calendar year goes through seasons. Over the course of many decades, economists have recognized this phenomenon and devised composite indicators to follow this progression. By way of an example, the Conference Board publishes leading, coincident and lagging... READ MORE
Aging demographics, technological innovation and an ever-expanding debt overhang are three reasons why inflation has been largely kept under wraps in the last three decades. They are still relevant, so why not extrapolate a benign inflation trend into the future? One reason might lie in the Fed's extraordinary... READ MORE
The S&P peaked in early September, but most other major averages and many internal indicators of breadth have been rangebound since March. Price action this week, though, suggests that there is a good chance this corrective process has run its course and we will see significant new highs... READ MORE
One of my favorite indicators is the Special K. It does not speak to us very often, but when it does, it's usually pretty reliable. I'll outline a few principles below, but for further reading, look hereandhere. The Special K, or SPK, recognizes the fact that... READ MORE
Back in AprilandMay, I wrote about the possibility that the tech-dominated NASDAQ had begun to lose its mojo. The argument was based more on relative action than the absolute price, as I was, and still am, bullish on the primary trend. Recent NASDAQ Underperformance is Likely to Extend Chart 1... READ MORE
Last week, the Fed announced that tapering is likely to begin later in the year, to be later followed by a leisurely hike in rates. As usual, those pesky impatient markets have decided to raise rates now rather than wait for the clobbering they know they will get later. It... READ MORE
Last week, the Fed announced that tapering is likely to begin later in the year, to be later followed by a leisurely hike in rates. As usual, those pesky impatient markets have decided to raise rates now rather than wait for the clobbering they know they will get later. It... READ MORE
Earlier in the month, I pointed out that the long-term indicators for commodities were still bullish, but getting overbought. At the same time, several intermarket relationships were signaling danger, which suggested some degree of vulnerability. Prices have not moved very much since then, but, bearing in mind that overstretched technical... READ MORE
Most of the time, the charts I plot are constructed from daily data. As a result, the necessary perspective provided by weekly ones often gets overlooked. By way of a remedy, I decided, some time ago, to create chartlists for key markets featuring weekly high low close and candlestick arrangements.... READ MORE