In this weekly note, we highlight 10 of the most important charts or themes we're currently seeing in asset classes around the world.
Industrials Are On The Ledge
Industrials are currently trading at their lowest level in over 10 months. In the large cap space, there are lots of charts that are still consolidating in the very same ranges they’ve been in since the first-half of last year. Both cap-weighted and equal-weight industrials fall into this category. In order to turn bullish on the broader market, we need to see more areas resolve these ranges to the upside. But in order for that to happen, they need to hold the lower bounds of these patterns in the meantime. As the list of sectors and industry groups that are resolving lower grows, it becomes easier to make a bearish argument for stocks as an asset class. Seeing industrials break down would also be a major development due to their high correlation with the S&P 500. The bottom line is that these ranges need to hold, otherwise we’re likely headed for an environment where the overall market comes under increasing pressure.
