And then of course there's Dr. Copper which appears to have successfully defended former resistance turned support at its all-time highs from 2011. It's impossible to overstate the importance of how this massive base in Copper resolves.
Bulls definitely don't want this move to evolve into a failed breakout... The 4.50-4.60 zone is the line in the sand.
As for Energy Markets... Crude Oil making its highest daily close since October 2018 might be the biggest development of all.
We had fun with this one all week. We can frame it in the context of Ford’s aggressive foray into the EV market or more narrowly as an expression of suburbanite luxury truck preferences. It fits well within the growth to value conversation as well as “old is new and new is old” themes. Even if it’s not seen strictly as a pair trade, it reflects a shift in investor interest and preference. After establishing a big base versus Tesla (one which looks an awful lot like an inverted head-and-shoulders pattern), Ford is poised to break out and move into empty space.
We're continuing to see strength and leadership in the semiconductor space. And a name the All Star Charts teams has been high on for some time has recently begun to break out from a new consolidation. Being that the stock is also making all-time highs -- you know situations like this get me excited.
So heading into a long Memorial Day Weekend, we're putting one more position on the books to round out our month.
Earlier in the week, we held our May Monthly Conference Call, which Premium Members can access and rewatch here.
In this post, we’ll do our best to summarize it by highlighting 5 of the most important charts and/or themes we covered, along with commentary on each.
On the this episode of Bearish or Bullish we talk about the Crypto Crash and how when Futures opened up on Sunday, they didn't care. Stocks were actually up a little. That's the market signaling to us that there is no systemic risk right now in Crypto. And we're not even close.
That's probably a good thing, and more bullish for the Crypto space considering how much larger it would need to get to really become intertwined with Stocks and Bonds, which combined are over $150T in market cap. Crypto is only 1.6T, just to put things in perspective.
We also discuss the latest Minor Leaguers Report which scouts the farm system for Small-cap stocks between $1-2B in market cap before they get called up to the Mid-caps ($2B+)
Relative strength in Bonds and European Banks. But is that sustainable? What should we expect?
All this and why Chardonnay is the world's most versatile grape on the latest Episode of Bearish Or Bullish.
We all know the universal disclaimer: past performance being no guarantee of future results.
But what has worked recently always gets a ton of attention from Wall Street. And for the past decade, buying and holding US large-cap stocks has worked.
If you’ve benefited from that trend, you deserve congratulations. Deviating from the principles of diversification and putting all your investment eggs in that one basket has increased your return and reduced volatility. To some extent, the worse your behavior (relative to theory), the greater your reward.
There is plenty of historical data that says that was not supposed to happen. But it did. Price is price, and we don't argue with it. Lived experience takes place in the space between theory and anecdote. That is where most actual investment decisions take place as well.
But we can only celebrate the last victory for so long before getting ready for the next game.
What we do here is take a chart that’s captured our attention, and remove the x and y-axes as well as any other labels that could help identify it.
This chart can be of any security, in any asset class, on any timeframe. Sometimes it’s an absolute price chart, other times it’s on a relative basis.
It might be a ratio, a custom index, or maybe the price is inverted. It could be all three!
The point is, when we aren’t able to recognize what’s in front of us, we put aside any biases we may have and scrutinize the price behavior objectively.
While you can try to guess the chart, the point is to make a decision…
So let us know what it is… Buy, Sell, or Do Nothing?
We're back to share with you, what we love to do and that is the Top/Down approach. At All Star Charts we're big fans of the weight of the evidence. The market tells us where it's going, and we listen. It's pretty simple really.
Over the past couple of weeks, we've noticed the PSU banks bouncing off their support and actually displaying some strength.
So today, let's take a look at what this particular sector is hinting at.
Something we’ve been working on internally this year is using various bottoms-up tools and scans to complement our top-down approach. One way we’re doing this is by identifying stocks as they climb the market-cap ladder from small, to mid, to large, and ultimately to mega-cap status (over $200B).
Once they graduate from small-cap to mid-cap status (over $2B) they come on our radar. Likewise, when they surpass the roughly $30B mark, they roll off our list.
But the scan doesn’t just end there. We only want to look at the strongest growth industries in the market as that is typically where these potential 50-baggers come from.
