In this Episode of Allstarcharts Weekly, Steve and I talk the relative performance of stocks. When assets are in strong uptrends, they not only perform on an absolute basis, but they tend to outperform their alternatives. With new highs in the S&P500 last month, we've seen nothing but lower highs relative to both Gold and US Treasury Bonds. In fact, on a relative basis, the S&P500 is actually down to its late December 2018 lows. Will they hold or confirm a massive distributive top? I think the resolution will tell us a lot about the strength of the current stock market.

From the desk of Tom Bruni @BruniCharting

In early July we were looking at some divergences that were signaling a potential short-term bottom in US Interest Rates.

That thesis was quickly proven wrong as global yields pulled the US down with them, and last week in our Conference Call we discussed our current outlook for Bonds and their many intermarket relationships.

Earlier this week JC discussed the fact that Bonds are at an interesting level relative to the S&P 500 as well.

Yesterday I discussed some of the pitfalls to avoid when using Bond ETFs as a proxy for the underlying assets.

Needless to say, we've been talking a lot about Bonds.

In this post, I'm going to take a simplified look at price action and momentum of the 2, 5, 10, and 30-Year Treasuries to assess the reward/risk and if there's a short-term trading opportunity at current levels.

From the desk of Tom Bruni @BruniCharting

This week I've seen a chart of High Yield relative to Investment Grade Bonds floating around with various conclusions, but I wanted to use this to highlight some things to consider when using Bond ETFs as a proxy for what's happening in the market it's meant to track.

Assets in the strongest uptrends not only do well on an absolute basis, they tend to outperform relative to their alternatives as well. In the case of the S&P500, with new all-time highs last month, we've just seen lower highs relative to both Gold and US Treasury Bonds. This is NOT evidence of a strong uptrend.

The question today seems clear to me: Is the underperformance of stocks relative to other assets "The Divergence" that we'll point to in the future as the heads up that something was changing? Or will we get relative rotation back into equities and this was just a temporary blip while stocks consolidated their massive 2016-2017 gains?

Here is the video from my BNN Bloomberg interview this week. They asked me if I thought the media was making too big of a deal out of an inversion of the yield curve and I agreed that of course they did. That's what the media does, irresponsibly exaggerate things that don't need to be exaggerated at the expense of their audience. I'm happy to come on TV to bring some sense of reality to the conversation. Someone has to. In this video we discuss the ongoing Cyclical Bear Market in stocks and what we're waiting for to confirm that a new Cyclical Bull is getting started.

What is the best chart in the world right now? I don't know. I guess that really depends on your time horizon, risk tolerance and overall market goals. These are different for all of us.

Today, I want to share what I think are collectively the 120 best charts. The way I see, there is no ONE chart that can tell today's story. But as a unit, these 120 slides give us a good look at the current market environment.

Todd Sohn is one of my favorite guys to talk to about the markets. He often sends me charts that no one else is looking at and points out important data that most people aren't talking about. His unique perspective on the market definitely makes him stand out from the rest. Todd and his team at Strategas do great work and it's a real pleasure to have him on the podcast. In this conversation we discuss the current environment for US Stocks, Interest Rates, Precious Metals and the sentiment driving current trends. He offers good advice for both new technicians and seasoned veterans. If you're at all interested in the market, this is an episode you can't miss. Enjoy!

From the desk of Tom Bruni @BruniCharting

Wednesday morning I outlined the charts we were watching ahead of the Fed Decision and what we would need to see before getting out of the way and reevaluating our bullish Equities and US Interest Rates thesis.

Today I want to look at those same charts and note what's changed and how we're moving forward.

From the desk of Tom Bruni @BruniCharting

Today will be a "big" day for markets as the Federal Reserve will announce their decision on the new target Federal Funds Rate.

Currently, markets are pricing in a roughly 80% chance of a 25bp cut and a 20% chance of a 50bp cut. This means market participants have assigned 0% odds to rates remaining where they are after today's meeting.

We've been pretty clear over the last few months about where we stand regarding the different asset classes, so there's not much left to do other than wait and see how prices settle by the end of the week.

With that said, here are a few charts we're watching through Friday's close.