From the desk of Tom Bruni @BruniCharting

Thanks to everyone who participated in this week's Mystery Chart.

A lot of mixed responses from this one. Some of you were buyers at support, while others were erring in the direction of the recent downtrend and looking for a resolution to the downside.

With that as our backdrop, let's just right into it.

These are the registration details for the live monthly conference call for Premium Members of All Star Charts.

This month’s Conference Call will be held on Tuesday September 15th at 6PM ET. As always, if you cannot make the call live, the video and slides will be archived and published here along with every other live call since 2015.

Here are the details for Tuesday:

I had a great conversation yesterday with Todd Sohn of Strategas, and our very own Steve Strazza, about Sector Rotation. We talked about this rotation, in theory, and also discussed what the current environment is suggesting.

The video of that call will be up shortly on our Youtube Channel. Make sure you're subscribed so you never miss an update! Subscribe for Free here.

The 3 of us were pretty much on the same page that we're getting healthy rotation among sectors and this will likely lead to new all-time highs across the major US Indexes, Sectors and Market Caps. So I asked Todd, what would you tell the Doom & Gloomer out there who is watching/reading this saying to him/herself that we're all completely full of it and the market is about to crash.

Right away he said, "Show them the Equal-weight Industrials breaking out to new highs relative to Equal-weight S&P500:

You'd be forgiven if you read this headline and completely discarded this blog post to the trash heap. I feel you. But assuming you're reading these words, you seem to be willing to entertain the possibility of "unpopular" ideas.

In my experience, when getting bearish on a stock or an index, it is rarely a smart play (statistically speaking) to purchase straight long puts. The reason being that if I'm spotting a bearish opportunity, then likely the rest of the world sees it too and therefore people are probably getting nervous and beginning to hedge their long positions with puts or are starting to bid up speculative downside bets. In either case, it usually inflates the implied volatility in the options pricing, making puts an unfavorable purchase.

But every so often, we find a case where a stock or an index has really just worn people out and people have just lost interest. And when the security starts to show signs of losing support, the opportunistic speculator can get ahead of the crowd before the opportunity becomes obvious to everyone else.

This appears to be the situation in the Energy Sector ETF $XLE.

One industry group we've been getting a  lot of questions about is textiles.

In addition to answering each person individually, I thought it'd be beneficial to write an entire post outlining what we're seeing in this area of the market.

This week on the show, Howard and I talk about the value in finding people to synthesize information for you. Howard is one of the best people I know at doing this, and I've picked up a few tricks from him over the years.

We can't be experts in everything. But with new tools and technology, we now have the ability to rely on other subject matter experts to point us in the right direction and give us perspective on how they see the world. I've found this process to be incredibly valuable. I encourage you to try it!

Here is our conversation in full:

In public markets, we have the ability to wait for our pitch. There are always new opportunities popping up, so if we miss one, we know there are plenty more on their way.

That's why one of the most important concepts we discuss in our work is the need for patience and knowing what we're going to do before it happens. By having a plan in place we can execute our plan once the conditions we've been patiently waiting for come to fruition.

A great example of this has been Crude Oil over the last few months.

From the desk of Tom Bruni @BruniCharting

New Mystery Chart!

For those new to the exercise, we take a chart of interest and remove the x/y-axes and any other labels that would help identify it. The chart can be any security in any asset class on any timeframe on an absolute or relative basis. Maybe it’s a custom index or inverted, who knows!

We do all this to put aside the biases we have associated with this specific security/the market and come to a conclusion based solely on price.

You can guess what it is if you must, but the real value comes from sharing what you would do right now. Buy, Sell, or Do Nothing?

Well well well... markets go in both directions. Who knew??

I jest of course, but man it was starting to feel like the market will only go up forever. And naturally, when market participants start feeling that way and then they are suddenly hit with a small dose of reality, those of us caught leaning the wrong way tend to panic.

But the panic always recedes as cooler heads prevail and realize that they may have overreacted. This is the bet I'm willing to make right now with today's trade.

From the desk of Steve Strazza @Sstrazza

At the beginning of each week, we publish performance tables for a variety of different asset classes and categories along with commentary on each.

Looking at the past helps put the future into context. In this post, we review the relative strength trends at play and preview some of the things we're watching in order to profit in the weeks and months ahead.

Last week, we followed up on some of the charts we recently cautioned were approaching overhead supply to see how they reacted to these critical levels.

Since we experienced a bit of a selloff on Thursday and Friday, this week we’re going to keep it simple and take a high-level look at some of the most important assets in the world and assess any damage that was endured...

...Spoiler alert: there wasn't much.

From the desk of Louis Sykes @haumicharts

Welcome to this week’s edition of Louis’ Look, where I write a brief note for the blog to document the lessons I’m learning every week. You can read the previous post here. This week, I want to focus on how market leadership is always in flux, and the best way to identify these changes is through, you guessed it, price.

Market volatility is picking up slightly, so we're trying our luck on the short side again with a name in the Energy space.