From the desk of Tom Bruni @BruniCharting

On May 1st, we wrote an update called "Canada or Cantada" going through the major sectors/indexes to provide a view on how we wanted to approach Canadian Equities.

As we can see, there are more uptrends than downtrends from a structural perspective. Tactically however, most of these are not at levels where we want to be initiating new positions or have a lot of conviction. After strong moves since December, they need some consolidation to digest those gains and set up for a sustained move higher.

Another thing to note is that the more defensive areas of the market like REITs and Staples have the clearest structural uptrends of the group. They make up a smaller portion of the market, but I think it's still an interesting signal about market participants' risk appetite and outlook for Interest Rates.

Additionally Energy and Materials account for roughly 30% of the index and remain a headwind, so without rotation into those names I think it'll be tough for the TSX Composite to break out to the upside.

In this post, we're going to outline the most significant charts/updates since April's post.

From the desk of Tom Bruni @BruniCharting

Stocks showing relative strength in this environment remain on our radar since the list of them has shrunk day by day over the last month.

For our Institutional Clients, we provide more tactical trade ideas or "plus-ones" that don't necessarily fit a broader theme but are still an attractive opportunity worth exploring.

Today I want to share one of those ideas from a subsector of the market that may surprise you...Retail.

From the desk of Tom Bruni @BruniCharting

Wall Street is a game of relative performance and we each are tasked with our own mandates/constraints in managing our portfolios.

The good news is that even when the market is a hot mess on an absolute basis, there are still plenty of ways to find performance within the context of those constraints.

If you need to have most of your capital allocated most of the time, then your focus is on either avoiding/shorting areas of relative weakness and owning areas of relative strength.

If you have the flexibility to raise cash and go to the beach or have short exposure on your books, that works too.

From the desk of Tom Bruni @BruniCharting

At the beginning of May, we put out a note about the failed breakout in many of the major indexes and why a more cautious stance was warranted for US and global equities. The divergences we were seeing slowly add up had finally been confirmed by price and we raised cash and stepped aside.

Since then, patience has paid if you let it.

Lack of trend, not just in the US, but globally, has been THE theme.

A month later, let's look at what's changed since then and if our gameplan needs to be adjusted at all.

As we head into June Expiration, there are a number of open positions with options expiring in June that may need some attention. Generally speaking as we approach any expiration, it is a Best Practice to begin aggressively weeding out or rolling out positions that aren't working. Why? For long premium plays, unless positions are comfortably in-the-money, theta decay will begin to accelerate and whatever premium is left in our options will quickly disappear. For short premium plays where we haven't yet reached our profit target, gamma becomes our enemy making our position more sensitive to fluctuations of the underlying. A small winner/loser could quickly get away from us. Best to roll it out to the next monthly expiration cycle to buy ourselves more time, or close it down and look for newer/better opportunities.

In no particular order, here are some currently open positions with June options that we'll be looking to take action on next week:

From the desk of Tom Bruni @BruniCharting

Two weeks ago I was scheduled to film two segments for Real Vision and the experience brought up a good topic that I've been meaning to write about using my personal experience; Perfectionism.

The night before I was supposed to film the segments I didn't get much sleep, hadn't exercised in a few days, and just wasn't feeling 100%. Needless to say, these were not the conditions I'd prefer for important filming.*

Regardless, I'd agreed to do it and I needed to show up and do the work.

Now that I've had time to reflect, let's see what perfectionism, failure, and fear of "shipping" have got to do with that experience.

India's recent rally has reaccelerated its trend of outperformance relative to the rest of the Emerging Market space.

In this post, I want to outline two charts we use to track this trend and another that helps explain why it's happening.

From the desk of Tom Bruni @BruniCharting

One of the hardest things to do in life and in markets is admitting you don't know. But when you're only in the market to make money, and not to be right, saying I don't know can often be the best answer.

That's why I put out a post titled "Relatively...Confused" just two days ago because when I go through my chartbooks I see extended themes that are not offering great reward/risk opportunities right now.

Elections, as with other major world events, introduce a lot of new information that market participants need to digest. This often causes increased volatility as expectations are adjusted and buyers and sellers battle to establish a trend.

So far this week we've seen an expansion in the intraday trading ranges, but not much resolution in terms of overall trend direction.

Here's what we're keeping an eye on.

We've spoken about the lack of trend in the Major Indexes for a while now, but another theme that's becoming more and more pervasive is the weakness in Tech stocks.

Let's see how we're going to approach it.

From the desk of Tom Bruni @BruniCharting

There are trends people tend to pick up on indirectly, usually by looking at individual stock charts or ETFs on an absolute basis, seeing the relative strength/weakness, and connecting the dots.

See something in one chart; it may not be all that special. See it in a lot of charts from the same area of the market...you're usually onto something.

That's the indirect way, but if we look at a trend directly, we can get a better feel for the exact strength of that underlying trend/theme.

In this post, I want to highlight a few trends that I know people are aware of, but may not realize their severity.