These are the registration details for our Live Monthly Candlestick Strategy Session for Premium Members of All Star Charts.
This month’s Video Conference Call will be held on Tuesday September 6th @ 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.
We look at a lot of charts. And believe it or not, many of them are absolute messes. Sideways, choppy, and trendless describe most markets right now.
It’s just a fact.
But we always find those big bases and tight continuation patterns on the verge of breaking out that keep us turning on our computers every morning. And the market I want to share with you today has both!
Currency markets have provided stellar trading opportunities this year.
It isn't always this way.
Last year was rough. False breakouts and whipsaws were the norm, as most forex pairs and crosses chopped sideways in trendless ranges.
Many of those consolidations have now resolved, as currency markets have begun to trend again. And it’s hard to find a stronger primary trend to bet against than the declining Japanese yen.
We’ve written about the yen multiple times in the past few months, pointing out that The Yen Provides the Base and joking that we could profit by simply buying Anything in Yen.
Today, we’ll follow up by outlining three tactical setups to bet on further yen weakness.
Thrust signals are typically reliable indicators of strength
Lack of risk appetite and rising yields working against stocks
Without marked deterioration in macro health, we still trust the thrust
The mid-August momentum thrust was just two weeks ago, but it seems longer than that. The S&P 500 has gone from up 4% for the month to down 3% for the month, in the process giving back half of the entire rally off of the June lows. It is possible that the volatility environment produced false signals of strength, but we are not ready to jump to that conclusion. The combination momentum and breadth strength seen prior to the mid-month peak has been a typically reliable indicator that further strength lies ahead for stocks. Two weeks of price action is not enough for me to throw out 40-years worth of data.
We hate to sound like a broken record. But "patience" is the name of the game in a tape like this.
Looking at the asset class from the top down, it's clear we're still in the basing process. There is perhaps no better visualization of this dynamic than our broad-based altcoin index.
Incorporating just over 300 coins, this equally weighted index tracks all USDT spot pairs on Binance, adjusted for stablecoins, leveraged coins, and other outliers.
We retired our "Five Bull Market Barometers" in 2020 to make room for a new weekly post that's focused on the three most important charts for the week ahead.
This is that post, so let's jump into this week's edition.
This is one of our favorite bottom-up scans: Follow the Flow.
In this note, we simply create a universe of stocks that experienced the most unusual options activity — either bullish or bearish, but not both.
We utilize options experts, both internally and through our partnership with The TradeXchange. Then, we dig through the level 2 details and do all the work upfront for our clients.
Our goal is to isolate only those options market splashes that represent levered and high-conviction, directional bets.
We also weed out hedging activity and ensure there are no offsetting trades that either neutralize or cap the risk on these unusual options trades.
We've had some great trades come out of this small-cap-focused column since we launched it back in 2020 and started rotating it with our flagship bottom-up scan, Under the Hood.
For the first year or so, we focused only on Russell 2000 stocks with a market cap between $1 and $2B.
That was fun, but we wanted to branch out a bit and allow some new stocks to find their way onto our list.
We expanded our universe to include some mid-caps.
To make the cut for our Minor Leaguers list, a company must have a market cap between $1 and $4B.
