From the desk of Tom Bruni @BruniCharting

The Equally-Weighted Semiconductor Index recently made new all-time highs, while the cap-weighted sits a few below its 2018 highs. What's next for Semis? That's what I hope to answer in this post.

Relative Rotation Graphs are some of the best visual tools in Technical Analysis today. In this episode, I am thrilled to have the creator of RRG, Julius de Kempenaer, on to talk about what first inspired him to create this tool and what some of the best practices are for market participants. I discovered RRG about 6-7 years ago after watching a colleague use it during a presentation at Bloomberg in New York City. As a technician, I use charts to visualize data to help identify trends and manage risk. RRG is more of a rotation tool that can be used for sectors, country indexes and currencies. By using a combination of Relative Strength and Momentum data, the RRG rotates clockwise from Leading to Weakening, to Lagging, to Improving and then back again to Leading. In this discussion, Julius walks us through how he likes to use it and explains its construction. If you're interested at all in sector rotation and relative strength, this tool is for you!

From the desk of Tom Bruni @BruniCharting

Palladium. For the last 3 years, nobody cared a lick as it nearly quadrupled in price. Over the last month however, I'd seen more mentions* as the price trend accelerated than I did for the entire 3-year trend beforehand.

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?

I don't often take long premium plays ahead of an earnings event, but there's one coming on the horizon where the options pricing isn't too high (yet) and the All Star Charts team has a price target that would yield us a greater than 4-to-1 return on risk if the earnings catalyst plays out in our favor.

Everyone these days is talking about yield curves inverting. It's the topic du jour, similar to things like golden crosses and 200 day moving averages. The difference is that this one is more intermarket oriented. "Well if this happens to bonds and that happens to rates, then this historically happens to stocks, or the economy". Observing the behavior of one asset class to help make decisions on another is called Intermarket Analysis, or "Cross-Asset" in some more institutional circles.

I don't think there is much more for me to say at this point about the yield curve. The crew over at The Chart Report pretty much covered it all beautifully last week. The short end of the curve (10-year minus 3-month) turned negative, but the long end of the curve did not. The 10s-30s spread is steepening and controlled by free markets vs the fed controlled short end. We've seen this happen before, like in the 90s for example, without it sparking bear markets. 

We've been writing about the slow improvement in price, momentum, and breadth over the last few months, leading us to err on the long side of stocks. With that said, we continue to see signals that Equities are not out of the woods just yet.

This is going to be a quick post looking at the potential failed breakdown that can lead to Reliance Communications doubling in a few months.

A year ago, I made a commitment to healthier eating. Not that I was a slob or anything, it was just that my attitude about what I was willing to put into my body (basically anything) needed to change. At my age, you begin to think about these things.

That said, I'll still happily get long stocks of fast food companies that are poisoning the human race if there's a way for me to profit from it (then spend the earnings at the local vegan grocer!). And one household fast food chain is setting up for a big potential move.

From the desk of Tom Bruni @BruniCharting

During last week's Conference Call we discussed a lot of the potential catalysts to drive Equities as an asset class higher over the intermediate/long-term, however, we continue to err on the cautious side given our outlook for sideways chop in the short-term.

Thursday I wrote about a growing number of potential "oopsies" (failed moves), so I want to follow up on that post and outline another group of charts that I think are suggesting short-term weakness in stocks.

From the desk of Tom Bruni @BruniCharting

If the US Dollar is falling, International Equities trading via US listed ETFs should outperform US Stocks. When the US Dollar is rising, International Equities should underperform US Stocks.

Sounds like a logical relationship, but as usual, it's not that simple.

From the desk of Tom Bruni @BruniCharting

During last week's Conference Call we discussed a lot of the potential catalysts for a lower US Dollar, so I wrote a free post talking about whether a weaker US Dollar means US stocks have to underperform International stocks. If you haven't read that, please do that first, because in this post I'm going to quickly touch on a short-term theme that continues to build within our Global ETF Ratio universe.