Worst six month stretch ever has investors in an exceedingly bad mood.
The June index-level lows are holding for now, but the response to the breadth and momentum thrusts that accompanied the summer rally has been somewhere between uninspiring and historically bad. On the one hand, the S&P 500 was essentially flat in the month following July 28 breadth thrust signal based on a surge in the percentage of stocks making new 20-day highs and even now is not outside the range of what has been seen in the past. The mid-August signal based on surging 40-day momentum, however, has been followed by unprecedented weakness.
More Charts than Football? Or the other way around?
I definitely got a healthy dose of both.
And this one for me definitely stands out.
The way I learned it from Ralph Acampora many years ago was, "DON'T FIGHT PAPA DOW"
So here's the Papa Dow he was referring to. I included the key levels we've been focused on since the 2018 correction. They've really helped and I think they continue to.
But for today, let's focus on the fact that prices are both below overhead supply and above support from the summer lows.
From any sort of intermediate-term perspective, this is what we call "No Man's Land":
I know this might be breaking news to some of you, but there are often great opportunities to be had in international stocks. And the All Star Charts International Hall of Famers report regularly serves up the best setups out there.
Today's trade comes directly from the most recent report, so let's board the airplane and head abroad!
Over the weekend, we've seen risk-off action persist following hotter-than-expected inflation data.
Following the Ethereum merge, most coins have sold off rather aggressively. Bitcoin now lies on a key level of support at its year-to-date lows, while a large number of altcoins have already made new lows.
For us to flip to a more bearish approach, we'd need to see Bitcoin confirm this internal weakness, which would manifest through a downward break of the 18,000 support band.
The largest insider transaction on today’s list is a Form 4 filing by two members of the Starbucks $SBUX board of directors, chair Mellody Hobson and member Richard Allison.
They reported purchases of SBUX worth a combined $5.9 million.
Spoiler alert: a fresh leg lower from gold doesn’t bode well for raw materials or the prospects of sustained inflation.
Nevertheless, inflation hasn’t gone anywhere, at least not yet.
As long as that’s the case, we expect commodities to see further upside, albeit not in unison. The broad rally witnessed at the end of 2020 into 2021 is unlikely to be repeated in the near future.
Regardless, stellar buying opportunities will present themselves.
We aren't going to let the bifurcated nature of commodity markets stop us from catching the next explosive rally.
In other words, the supply and demand dynamics for copper don't affect our decision to trade soybeans or wheat.
