It’s the weekly commodity edition of What the FICC?
Every day we have the choice to either follow the news or follow trends. I choose the latter…
Check it out!
Expert technical analysis of financial markets by JC Parets
by Ian Culley
It’s the weekly commodity edition of What the FICC?
Every day we have the choice to either follow the news or follow trends. I choose the latter…
Check it out!
by Ian Culley
Inflation has peaked!
Or so I’ve been told…
Rates are rolling over, undercutting their June highs from last year. High-yield debt, including emerging-market bonds, is catching a bid.
And major commodity indexes are on the verge of breaking down.
That all sounds logical to me.
But just because inflation might begin to ease doesn’t mean I’m taking a bearish stance on inflationary assets, especially commodities.
As crazy as that may seem, these next four charts support my case…
What do the movies The Wizard of Oz and The Matrix have in common? The answer is that they both are stories about artificial intelligence. The Wizard of Oz is one of the earliest examples of this in popular culture, with the philosophical question of what types of AI matter most – was it the Scarecrow, who needed brains (computational power), or the Tin Man, who needed heart (the emotional intelligence to understand us)?
Thanks to the efforts of early pioneers in the field like Alan Turing in the 1950s, who helped address and begin work on these problems, we can fast forward 70 years and marvel at contemporary companies like OpenAI, that have solved many of those initial challenges.
Here at All Star Charts, we’re more old school – but we’re not outdated. We know that the foundations of technical analysis are predicated on the study of behavioral science, and how biases like price anchoring, fear, and greed create repeatable patterns we can take advantage of.
And since we’re on the subject, it turns out that investors, computers, whoever or whatever is driving the market moves we’re seeing today; they’re paying attention heavily to leading companies in the AI space. Investors now know, and are actively betting, that AI allows computers to better emulate human behavior more efficiently and accurately than ever before, and that this is a trend worth paying attention to.
If you had any doubts, that last sentence was entirely written by ChatGPT when I asked it why investors would want to bet on AI.
And now you know why we’re talking about Artificial Intelligence in this report. The industry is on fire – from talks of Microsoft investing $10bn into OpenAI, Jasper, a marketing tool raising $125m at a $1.5bn valuation, or Stable Diffusion, an AI imaging company that recently hit unicorn status, we want to pay attention to which public companies are benefiting as well, so our clients can take advantage of these opportunities.
by Ian Culley
From the Desk of Steve Strazza @Sstrazza and Alfonso Depablos @AlfCharts
Our International Hall Of Famers list is composed of the 100 largest US-listed international stocks, or ADRs.
We’ve also sprinkled in some of the largest ADRs from countries that did not make the market cap cut.
These stocks range from some well-known mega-cap multinationals such as Toyota Motor and Royal Dutch Shell to some large-cap global disruptors such as Sea Ltd and Shopify.
It’s got all the big names and more–but only those that are based outside the US. You can find all the largest US stocks on our original Hall of Famers list.
The beauty of these scans is really in their simplicity.
We take the largest names each week and then apply technical filters in a way that the strongest stocks with the most momentum rise to the top.
Based on the market environment, we can also flip the scan on its head and filter for weakness.
Let’s dive in and take a look at some of the most important stocks from around the world.
by JC
A funny thing happened last summer.
Financials as a sector successfully retested the highs in price from just before the start of the Great Financial Crisis.
Look at the 2007 peak in Financials. After testing that level and failing in 2018 and 2020, prices ultimately broke out.
Last summer was the retest.
Former Resistance turned into Support: [Read more…]
by Ian Culley
It’s the weekly bond edition of What the FICC?
The relative strength of Emerging Market bonds shores up the ongoing bottoming process for risk assets.
Check it out!
by Ian Culley
From the Desk of Ian Culley
It’s impossible to ignore – investors are reaching for risk.
Biotech stocks are catching higher. Copper futures are working on their tenth up-day in a row. Even the Emerging Market HY Bond ETF $EMHY is breaking to 7-month highs as it completes a multi-month base.
And don’t forget about Silver! Gold’s crazy cousin has proven by far the best-performing asset since the US dollar peaked last fall. Strength among these market areas indicates a healthy risk appetite.
I can’t overlook these signs of a constructive bottoming process, especially considering the next chart…
I got a lot of feedback on my last letter where I suggested active traders need to stop trading Covered Call spreads for tactical trades and instead do a simple Naked Puts trade.
Thank you to everyone who engaged.
Anyway, here’s one question [edited to the important parts] I got from a reader where I thought my answer might be instructive to more of you:
Hi Sean,
I read your information on naked puts. When I intend to buy a stock, I would like to sell a put. I just don’t know how to go about it. I just don’t know where the strike price would be. I understand that I would have to buy the stock at that price (whether it is better or worse than hoped).
If you could give me an example that would help.
Cheers!
This is a great question, but one without a clear-cut answer. Here was my response: [Read more…]