There is a lot going on in the market right now, not just in the U.S. but globally. The intermarket relationships between Bonds, Gold and the US Dollar are having a major impact on equities.
January is a month that gives us a lot more information than most other months throughout the year. We have the data now that we can use to help us identify primary trends.
Volatility is picking up. Daily swings are getting larger. I’ve seen this story before.
We discuss all of this and a lot more.
This is the video recording of the February 2020 Conference Call.
*NOTE: This Post and Video was originally intended for Premium Members of Allstarcharts Only. But due to the circumstances, we have unlocked it for everyone to watch and download the slides. We feel this can be used for educational purposes moving forward. Thank you for understanding.
This week I sat down with Irusha Peiris of Investor's Business Daily to talk markets and life lessons.
I was invited on to the Investing with IBD Podcast where we discussed the current market environment, including US and International equities. We talked about interest rates and their intermarket relationships with other asset classes like currencies and commodities. Most importantly, in my opinion, I lay out 4 very critical levels, in 4 indexes specifically, that I think will be the biggest hurdles to jump over in order for stocks to continue higher.
Today I have a group of charts that I think will help me explain my thought process here. We're keeping this very simple.
Let's go!
The first thing that stands out is the breakout to new all-time highs for the Dow Jones Industrial Average that has not yet been confirmed by the Dow Jones Transportation Average. This rejection in January and failure to exceed those former highs is worrisome. If this market was as strong as some of the other indicators have/had been pointing to, then we should have seen a breakout by now. Here is the Dow Jones Industrial Avg:
Click on Charts to Zoom in
And here is the Dow Jones Transportation Average getting rejected hard last month:
In this Episode of Allstarcharts Weekly, Steve and I discuss all the reasons why we're buying bonds right now instead of stocks and commodities. The big point here for me is that it's not just one chart. There is no single holy grail suggesting we buy bonds. This is a weight of the evidence conclusion. It's not one chart, it's hundreds of them all pointing to the exact same thing: Sell stocks and Buy bonds!
I can't believe I'm publishing the 100th Episode of this podcast that I started in the summer of 2017. My first guest ever was Ralph Acampora! I mean, how could it not be right? Since then I've had the privilege of interviewing Portfolio Managers, Traders, Analysts, Best Selling Authors and even a World Series of Poker Champion! People all over the world have approached me how much they've learned from listening to the podcasts. It's been an amazing experience for me all around.
My big question coming into this weekend was what should we make of the action in Utilities lately and what does it mean for Bonds?
Utilities are making new all-time highs on an absolute basis, posing this question on Twitter: "So is the breakout in Utilities to new all-time highs a signal that a Bond breakout is coming, or is it simply a bi-product of overwhelming demand for Equities?
This got a lot of attention and responses, so I thought it'd be worthwhile to quickly outline what I'm watching in Utilities and the Bond market over the next few weeks.
In late August we started to see some signs of a potential bottom forming in Commodities as they approached long-term support with momentum diverging and in October we finally got a breakout.
Today that breakout in the Thomson Reuters CRB Commodity Continuous Index remains intact and the trend in Commodities as an asset class has shifted from one we want to be selling rips to one that we're buying dips.
From an intermarket perspective, there are a lot of signals we've discussed that support higher Commodity prices such as the AUD/USD and CAD/USD breakouts, and today I want to share three more data points that have shown up in the last few weeks.
As we head into 2020, we start from scratch with our Q4 playbook and outline our thoughts on every asset class and our plan to profit in the quarter (and year) ahead.
Part 1 of this playbook will cover our macro view, touching on Equities, Commodities, Currencies, and Rates.
Part 2 of this playbook will delve deeper into Indian Equities, going sector by sector to identify the trends that matter.
Part 3 of this playbook will outline the individual stocks we want to be buying and selling within the context of today's environment.
As we head into 2020, we start from scratch with our Q4 playbook and outline our thoughts on every asset class and our plan to profit in the quarter (and year) ahead.
Part 1 of this playbook will cover our macro view, touching on Equities, Commodities, Currencies, and Rates.
Part 2 of this playbook will delve deeper into Indian Equities, going sector by sector to identify the trends that matter.
Part 3 of this playbook will outline the individual stocks we want to be buying and selling within the context of today's environment.
As we head into 2020, we start from scratch with our Q4 playbook and outline our thoughts on every asset class and our plan to profit in the quarter (and year) ahead.
Part 1 of this playbook will cover our macro view, touching on Equities, Commodities, Currencies, and Rates.
Part 2 of this playbook will delve deeper into Indian Equities, going sector by sector to identify the trends that matter.
Part 3 of this playbook will outline the individual stocks we want to be buying and selling within the context of today's environment.
I was down in New York City this week and dropped by the Nasdaq to chat with my old pal Frances Horodelski on BNN Bloomberg. Frances and I have been rapping about the markets for the better part of the past decade. It was great to chat with her once again.
In this short clip, we talk about the new bull market for stocks, rotation into Emerging Markets and Energy, where we think gold goes and how bad bonds are going to get hit if interest rates get to the 3% mark we're looking for in the US 10-year Yield.
