Many people are surprised that we are back to where things first fell apart for the S&P500 and Dow Jones Industrial Average last year. We had a severe correction in Q4, and now prices have climbed back to where this all got started. At this point, nothing surprises me anymore. Those who are still "shocked" by anything probably haven't been doing this very long....

The question we find ourselves asking this week is simple: Are these major US Stock Market Indexes going to fail up here, like they did in October, or will they break out and rip to levels never seen before?

One of my good college buddies always busts my chops because he thinks it's ridiculous that look at charts all day. Today he calls me about some other stuff, but randomly asked what was my favorite chart. I'm like, "...of all time or right now?". He said right now, what's my favorite chart?

It got me thinking. But my first reaction was the SPX/CRB chart. This is one of the most fascinating situations in the world today.

From the desk of Tom Bruni @BruniCharting

I saw a couple tweets yesterday about FAANG stocks and their "lack of participation" in the market's four month rally and just don't get it.

First it was a problem when the largest stocks in the S&P 500 were leading. Now it's a problem that most aren't hitting all-time highs with the S&P 500.

From the desk of Tom Bruni @BruniCharting

New Mystery Chart!

For those new to the exercise, we take a chart of interest and eliminate the x and y-axes and and all labels eliminated to minimize bias. The chart can be any security in any asset class on any timeframe on an absolute or relative basis. It can even be inverted or a custom index.

The point here is to not guess what it is, but instead to think about what you would do right now. Buy, Sell, or Do Nothing?

Recent price action in a tech name has us opportunistically wading in to catch a possible earnings driven bounce. We don't often put trades on in anticipation of a reversal of price action (we tend to be drawn to trends), but in this case we have a stock that has pulled back in recent days to a major past breakout area and we've got an earnings event coming up that just may be the grease which gets the wheels turning back in the direction of the broader trend.

From the desk of Tom Bruni @BruniCharting

April 10th we looked for a bounce in Healthcare Providers and were early, so several of our trades were quickly stopped out and others didn't trigger at all. Medical Devices were the last subsector standing and once they were hit, we thought that Healthcare was likely close to a short-term bottom.

Given the extreme oversold readings we were seeing in our work (like percentage of XLV components hitting oversold conditions last week) and the subsequent bounce to start this week, I want to outline five names showing relative strength in the space that could benefit from continued mean-reversion in the sector.

More importantly, they offer well-defined risk and a reward/risk that's skewed in our favor.

From the desk of Tom Bruni @BruniCharting

Rotation into Energy stocks continues to pick up. While the reward/risk opportunities at the sector/subsector ETF level aren't great, there are several attractive setups within individual stocks.

In this post I'm going to point out seven names within Energy ETFs XLE, XOP, OIH, AMLP, CRAK, and FCG with extremely well-defined risk and skewed reward/risk at current levels.

Half are buying strength (higher probability, but lower reward/risk) and the others are mean-reversion setups (lower probability, but higher reward/risk). Pick your poison.

From the desk of Tom Bruni @BruniCharting

I just finished writing a free post for All Star Charts India following up on where we've been over the last two months and what this last week of price action means for Indian stocks in the near-term.

As I was writing up the post I noticed a lot of similarities between US Stocks today and where India was just a few weeks ago.

I'm going to summarize the key points, but I'd encourage you to read that post in full so you can really see what I'm talking about below.

Anyway, let's just jump into it.

In our April 10th Chart of The Week, as well as in our Member's Only Conference Call on Thursday, we presented the question of whether the bearish momentum divergences we were seeing in the Nifty 50 and other major indexes would matter or if the market would brush them off and continue higher.

Well, we finally got our answer.

Sometimes, stocks you want to own give you no chance to get in comfortably. They just start running and offer you no pullbacks to buy into. In hindsight, these are always the ones we wished we woulda just closed our eyes and hit market buy on. Of course, in real life and in real time, it's impossible to know when you're looking at a stock that is going to run straight up. One such stock that has given me a little of this FOMO (fear of missing out) has recently offered us a slight window to buy into. And at the time of this writing (Monday morning, April 22), S&P Futures are indicating a gap down opening for the broader market, perhaps adding to our chances of getting in at a better price.

What inflation?

This seems to be the talk of the town these days.

Interest rates all over the world made new lows last month and have since then tried to start a recovery. We're seeing this across the developed world in the U.S., Germany, UK and Japan, among others. Meanwhile, journalists at Bloomberg Business Week decided to put a dead dinosaur on the cover of the latest issue asking, "Is Inflation Dead?"

During yesterday's Members-Only Conference Call we outlined a trade idea that falls into the low probability, high reward/risk category.

In this post I want to share that idea and explain why it's the type of trade we'll take every day of the week.