We've been talking a lot about our expectations for continued volatility and what conditions we'd need to be bullish stocks again.

In this post, we want to step back and see what some of the longer-term weekly and monthly charts are suggesting for stocks and the other major asset classes.

Here's the Nifty 50 which spent the last two years grinding slightly higher as momentum diverged negatively. So far this year, prices have fallen 40% and retraced 38.2% of their entire 2001-2019 rally...in three months. From a risk management perspective, bulls need to see 8,000 hold in the Nifty 50 or there is further downside risk towards 6,200.

Click on chart to enlarge view. 

Last week we outlined why the risk remains elevated in stocks and updated our forecast for continued volatility.

When markets go through periods of elevated volatility/stress, many market participants look to catch the exact bottom, but a better approach in our view is to buy on the way back up!

From the desk of Steve Strazza @Sstrazza

Every weekend we publish simple performance tables for a variety of different asset classes and categories along with brief commentary on each.

As this is something we do internally on a daily basis, we believe sharing it with clients will add value and help them better understand our top-down approach. We use these tables to provide insight into both relative strength and market internals.

This week we want to highlight our US Equity Index and Sector tables, as they are both showing continued evidence to support some of the trends we've discussed recently.

Click on table to enlarge view.

It's hard to have a conversation about the previous bull markets in the United States without including Apple $AAPL. It hit a Trillion Dollar market cap and actually doubled in value last year, believe it or not. This is the poster child for big strong US stocks.

Today, I want to talk about just how clean this stair-step pattern has been for the stock. It's inability to continue this bullish tradition could mean big trouble for US Stocks. However, holding on to last month's lows could mean the worst might be behind us for the overall stock market. My bet is on the former, more volatility, but the market doesn't care what I think. So let's try to figure it out together.

From the desk of Steve Strazza @Sstrazza

As always, thanks to everyone for participating in this week's Mystery Chart. Almost all respondents were buyers. A few also mentioned they would only want to be long against potential support at the prior lows which is likely the same approach we'd be taking with a long-term timeframe.

Something we've hit on a lot lately which was also a common theme among the Technicians that presented at Chart Summit 2020 last weekend, is that the relative trends that have been in place have more or less remained in place throughout the recent volatility. Check out this week's podcast episode where JC and I discuss this and other key themes from the conference.

From the desk of Tom Bruni @BruniCharting

Last week we talked about some of the positives in the market...Copper holdings its low, Tech leadership, etc.

This week we're taking a look at why this rally is likely a dead cat bounce with some stats.

In this post, we're going to outline the inter-market signals we're watching for stocks next move...and why they suggest it's likely lower.

From the desk of Steve Strazza @Sstrazza

The market rallied almost 20% in just three days after making new lows last Monday. Stocks recently sold off in record fashion so it's no surprise to see them bounce with the same ferocity. But with the VIX still elevated above 50, we're not out of the woods yet and should expect the swift moves in each direction to continue for now.

Some say we're in a new bull market, but the charts tell us we're actually at a logical level for what appears to be no more than a bear market rally to stop and reverse.

Last week we outlined why 170 in the Nasdaq 100 ETF (QQQ) was such an important level of interest if buyers were going to take control of stocks in the near term. Now that they have, we're looking for sellers to reassert themselves at current levels, which we wrote about yesterday.

From the desk of Steve Strazza @Sstrazza

New Mystery Chart!

For those new to the exercise, we take a chart of interest and remove the x/y-axes and any other labels that would help identify it. The chart can be any security in any asset class on any timeframe on an absolute or relative basis. Maybe it’s a custom index or inverted, who knows!

We do all this to put aside the biases we have associated with this specific security/the market and come to a conclusion based solely on price.

You can guess what it is if you must, but the real value comes from sharing what you would do right now. Buy, Sell, or Do Nothing?

In our market view update, we outlined how we're approaching stocks after catching last week's 20% rally in the Nifty 50.

In this post, we want to share an intermarket signal that's suggesting a defensive posture remains best when approaching stocks as an asset class.

Last week we looked for a counter-trend rally in stocks and we got it. The Nifty 50 rallied 20% from its intra-week low to its intra-week high, leaving a lot market participants asking if Indian stocks are out of the woods.

In this post, we're outlining why our defensive stance remains and how we're approaching the weeks ahead.

From the desk of Steve Strazza @Sstrazza

This week's Mystery Chart exercise gives us a nice glimpse into the current sentiment amid the recent volatility, so thanks to all those who responded. The overwhelming majority of you we're either selling or doing nothing, which comes as little surprise.

Many of you wanted to sell this chart aggressively and even cited the current market environment as part of you're reasoning. But! The chart was inverted... so all those who were pounding the table to short it were actually buying the Nasdaq 100 (QQQ) relative to the Russell 3000 (IWV).

I'm curious to see how, if at all, this changes your perspective on the chart. Tweet me @sstrazza with your thoughts!

This week, the US Dollar/Rupee pair hit our upside objective and evidence suggests a near-term pullback is likely.

In this post, we'll update our risk management levels and outline why the Rupee remains at risk longer-term.