STOCKS HAVE VERY STRONG WEEK... Major U.S. stock indexes registered their strongest week since November 2020. And they also broke through some initial resistance levels. The week's strong action signals that stocks have put in a short-term bottom and may continue to gain some ground. Their longer-range... 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
STOCKS USUALLY PEAK AFTER BONDS... One of the most important features of intermarket analysis is the rotation that normally takes place between bonds, stocks, and commodities at major turning points in the business cycle. That rotation between the three asset classes is especially relevant to the current global situation. Those... 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
WEST TEXAS CRUDE OIL REACHES 11-YEAR HIGH... The war in Ukraine continues to push oil prices sharply higher along with other commodities. That includes metals and agricultural products. Gold continues to gain ground as a traditional haven during times of rising inflation and increased global tensions. Some defensive money is... 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
SELLING THE RUMOR AND BUYING THE FACT... Thursday morning's heavy selling of stocks and the buying of traditional safe havens like bonds, gold, and oil reversed sharply that same afternoon. Stocks rose while safe havens lost most of their morning's gains. That more positive trend continued... READ MORE
STOCK INDEXES REACH NEW LOWS ON RUSSIAN INVASION... News of a full-scale Russian invasion of Ukraine is pushing global stocks sharply lower and pushing money into traditional safe havens like gold, oil, and bonds. The price of West Texas crude oil spiked to $100 this morning while gold prices also... 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
RISING TENSIONS BOOST GOLD... With increased warnings that a Russian invasion of Ukraine is likely, investors are selling stocks around the world. And they're buying gold which is usually viewed as a traditional safe haven in times of heightened global tensions. Chart 1 shows the Gold Shares SPDR... 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
In this new StockCharts TV special, Larry Williams shares what he thinks is coming up. He walks us through the historical data, shares the points he believes are the most important to take into consideration and goes on record with his answer to the question everyone is asking - are... READ MORE
STOCKS FAIL TEST OF MOVING AVERAGE LINES... Thursday's CPI report showed January inflation rising 7.5% on an annual basis which was the highest number in four decades (since 1982). That higher inflation number raised prospects for a more aggressive Fed starting next month, and pushed stocks sharply... 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
SHORT-TERM BOUNCE RUNS INTO RESISTANCE... My last message showed the three major stock indexes in an oversold condition and trying to bounce from underlying chart support. So the recent stock rebound wasn't a surprise. Neither was the size of the rebound. The combination of overhead resistance and today&... 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
OVERSOLD MARKET ATTEMPTS TO STABILIZE... After an incredibly volatile week of trading, stocks are in a short-term oversold condition and attempting to stabilize near chart support. Chart 1 shows the Dow Industrials stabilizing near a flat support line drawn under their June low. At the same time, the 14-day RSI... 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
NASDAQ CONTINUES TO LEAD MARKET DECLINE...Stocks are suffering through another bad week, with the Nasdaq market continuing to lead the decline. The Nasdaq Composite Index has also suffered the most technical damage. It fell below its 200-day moving average last week. Chart 1 shows the COMPQ falling below its... 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
NEGATIVE DIVERGENCES ON SPX... A number of negative divergences have shown up on the major stock indexes which have weakened the market's technical condition. Those divergences are showing up mainly in daily momentum oscillators. Chart 1 shows the S&P 500 rallying to a new record at... 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
Larry presents his predictions for the markets in 2022 in this new StockCharts TV special. Can the future really be known? In general, Larry thinks so. But, as he always says, trust but verify, and the proof is in the pudding. Larry looks back at his previous presentations and forecasts... READ MORE
FED MINUTES PUSH STOCKS LOWER... The release of Fed minutes yesterday from its December meeting reflected a more hawkish tone which pushed stocks lower and interest rates higher. The Nasdaq took the biggest hit owing to a big drop in technology shares which are the most vulnerable to rising rates.... 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
STOCK INDEXES GAIN GROUND... Stocks are ending the trading week on a strong note as shown in the three charts below. The most notable one belongs to the S&P 500 in Chart 2 which is nearing a test of its old high. Ten of eleven stock sectors are... 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
STOCK INDEXES WEAKEN... Stock prices are ending a volatile week on the downside. So far, no serious chart damage has been done as the three major stock indexes shown below are testing potential support at their 50-day moving averages. Stocks are struggling with the spread of the omicron virus (and... 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
LARGE CAPS ARE ENDING THE WEEK HIGHER DESPITE RISING CPI... This morning CPI report showed annual inflation rising 6.8% to the highest level in nearly forty years. Despite that high reading, major stock indexes are gaining ground on the day and week. Chart 1 shows the Dow Industrials climbing... 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
Will stocks rally this Christmas? Larry answers the question and explores when the ideal short-term trading opportunity will be in this new StockCharts TV special. Larry also presents his forecast for Bitcoin and gold, sharing what he thinks is in store for gold over the next several months. This video... READ MORE
MOVING AVERAGE LINES ARE BEING THREATENED... A combination of factors are pushing stocks lower again today to extend weekly losses. A weak jobs report this morning, fears of accelerated Fed tightening to fight inflation, and worries about the Omicron coronavirus are keeping stocks on the defensive. Ånd moving lines are... 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
STOCK INDEXES PLUNGE... Reports of a new covid variant in South Africa pushed stocks sharply lower the day after Thanksgiving. As a result, all three major U.S. stock indexes suffered short-term technical damage. Chart 1 shows the Dow Industrials falling -904 points (-2.5%) and ending the day well... 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
S&P 500 SHOWS SOME NEGATIVE DIVERGENCE... Stocks are ending the week in a mixed fashion. The Dow Jones Industrials are weakening, while the Nasdaq 100 is hitting a new record. That being the case, this message will focus on the S&P 500 which is in 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
STOCK INDEXES MAINTAIN UPTRENDS... Stocks are ending the week trying to make up some losses from Wednesday's sharp selloff after the CPI annual inflation report of 6.2% was the highest level in thirty years. Chart 1 shows the Dow Industrial staying above its 20-day moving average. Charts... READ MORE