Here is the video in full:
Source:
Business Day: Technical Tuesdays (BNN)
Tags: $CRB $DX_F $SPY $SPX $UUP $GC_F $GLD $TLT $TNX $ZB_F
Expert technical analysis of financial markets by JC Parets
by JC
Here is the video in full:
Source:
Business Day: Technical Tuesdays (BNN)
Tags: $CRB $DX_F $SPY $SPX $UUP $GC_F $GLD $TLT $TNX $ZB_F
by JC
The worst performing month of 2013 is now in the books. Funny enough, the S&P500 only lost 3%. But the internals and breadth in this market have been deteriorating for some time. We’ve pointed to several examples of this over the past 4-5 weeks, so today we reviewed some of that. Also bonds this week confirmed everything we discussed in last week’s video. They look great and everyone still hates them. And finally since it’s the end of the month, we took a look at the Dow Jones Industrial Average going back 20 years. And it looks like we’re up in the nosebleed section.
I hope you enjoy the video:
Tags: $DJI $DJIA $DIA $SPX $SPY $ES_F $TLT $TNX $ZB_F $CRB $DJP
by JC
Sometimes we allow our preconceived notions get in the way of objective analysis. I see this time and time again. A trader might be bearish on the stock market so that prevents him from buying a non-correlated stock in a beautiful uptrend. I’m guilty of this myself. We’re human right? Sometimes, when I rip through a series of charts, I don’t even look at the symbols. I just keep going until I find one that I love (or hate), and then see what it is. The best part about this process is when you like a particular chart, and look up at the symbol only to realize that you already own it. That’s when you smile, and move on.
So I’ve been posting charts on occasion without any labels or detailed time frames. Just a bar chart and our imagination. This week’s mystery chart sparked some nice conversations over the social interwebs. As usual, there were some great ideas and risk management procedures shared by readers and twitter followers.
The mysterious bar chart this week was Coffee Futures using 30-minute time frames. Here is the actual chart with dates and prices:
I agree with a lot of the feedback that this could be an excellent long above this overhead resistance. Momentum has turned up while prices have consolidated the last couple of weeks. With the downtrend line now broken, we’re just waiting for the overhead supply to dry up. And I have a feeling this should come soon. We’ll see….A breakdown below this consolidation could lead to another big leg lower. So we’re waiting for a breakout.
Click here to see the original post
Tags: $KC_F $JO
by JC
To quote the legendary Staten Island based philosophers, “Dolla Dolla Bill Y’all” indeed. This statement could not be more relevant than right now. Want to know where commodities are headed, and therefore emerging markets, and probably stocks as an asset class? Look no further than the US Dollar bill.
Here’s what I see. Commodities and US Dollars have some of the most consistent and reliable negative correlations in the intermarket world. The chart below shows how strong this trend has been for a while, during both bull and bear markets for stocks. The correlations between the US Dollar Index and CRB Index have been extremely negative, there’s no denying it:
So where are commodities headed? Well if August marked the bottom for dollars, I would say commodities are heading much lower. And if that’s the case, I would imagine that Emerging markets follow. Go run the numbers and you’ll find very high positive correlations between both assets. And if EM continues to get crushed, will US stocks be able to ignore that? Doubt it.
I think Dollars are the key here guys. This is a weekly chart of the US Dollar Index going back a few years. We’re right back down to this key uptrend line. I would say that a break below that trendline support (80.60-ish) and all bets are off on this dollar. That change of events would be bullish for commodities and emerging markets. And I have to believe US Stocks would benefit from that.
But the trend right now is pointing towards higher US Dollar prices. So that’s the direction in which we’re leaning.
Tags: $DX_F $UUP $USDX $CRB $DJP
by JC
Alright guys. No labels, no time frames. Bars and Momentum via 14-period RSI
Talk to me….
Recent Mystery Charts:
by JC
Now that Syria is taking over the news, interest rates and bonds have taken a back seat in the financial media. But for us market participants, this is still front and center. If you watched this weekend’s market video that I did with Phil, or follow me on Stocktwits or Twitter, you know that I’ve been really vocal lately about the potential bottom in bond prices. But today I want to focus on rates.
This is a chart of the 10yr Treasury Note Yield Index. We’re looking at candlesticks that show yields are retesting what was formerly key resistance throughout the summer:
The problems I see are 1) the quick reversal lower after the new highs last week and 2) the momentum divergence that developed on those new highs. As yields took out resistance, the relative strength index made lower highs. That worries me.
In addition, we see crazy bearish sentiment in Treasury Bond prices. These are the kinds of numbers that we’ve seen consistently at peaks in yields; most recently in early 2011 and mid 2009.
For confirmation, we want to see a weekly close in 10yr yields below 2.7%. With rising 20, 50 & 200 day moving averages, there is no doubt that yields are and have been in a bull market. But so were stocks just a few weeks ago right?
Stay tuned…
Tags: $TNX $TLT $ZB_F $ZN_F $TBT
by JC
A funny thing happened on Monday afternoon. As stocks rolled over into the close, US Treasury Bonds didn’t follow. This is now something different, a change in character for these markets. Last Friday we ran the numbers: Stocks and Bonds ($SPY & $TLT) had a 1-week positive correlation of +0.95, a 2-week correlation of +0.94 and a 1-month +0.79. The results showed a very high positive correlation between the two asset classes. Interest rates rising was bad for stocks and bonds. But no more.
I was pretty vocal on Stocktwits Monday about this shift in market behavior. But since this has now continued into Tuesday, I think it’s worth a quick blog post. Lower rates are now negative for stocks.
Here is a 10-minute chart showing the close relationship between the two asset classes. They came apart around 2 o’clock Monday:
With stocks selling off, it seems as though the market is looking for the safety of US Treasury Bonds. Safety appears to be the priority, not the fear of higher rates. This is an interesting development.
I’ll follow up as this behavior continues. I think this is just the beginning of the return of negative correlations.
Tags: $TLT $SPY $ZB_F $ZN_F $TNX $SPX $ES_F
by JC
We had a lot to cover this week. And although this may be a boring few days coming up, there are some interesting setups that could start to get going. First of all, everyone hates bonds so I think that’s something to pay attention to. But we also discussed Herbalife, Vietnam, S&Ps and the importance of keeping an open mind as a market participant.
Enjoy:
Tags: $SPY $DJIA $DIA $SPX $HLF $VNM $TLT $ZB_F $TNX