Most of the stocks we've liked on the long side have either been stopped out or are well on their way to our upside objectives. While we're remaining patient and think many stocks still need to consolidate their recent gains, that doesn't mean there aren't any opportunities right now.

In this post I'm going to outline the stocks where our risk is very well-defined and reward/risk is skewed in our favor. That way we can participate in any potential upside if the market continues higher, while also limiting our downside should it succumb to the near-term weakness we've been on watch for.

From the desk of Tom Bruni @BruniCharting

I received a ton of great responses via Twitter and email for this week's Mystery Chart, so thank you for that.

A lot of you were leaning toward the long side, with different approaches and stops. Some were neutral, but none of you were getting short.

From the desk of Tom Bruni @BruniCharting

A few weeks ago I wrote about Shippers, Casinos, and some Construction/HomeBuilding Related stocks being some of the weakest areas of the market. About the message the market would be sending if those stocks couldn't see downside follow-through after breaking down.

So let's check in on those "shitty" stocks.

Most of the Commodities and Currencies we track continue to lack a long-term trend, but I want to outline a few charts in the space that are notable right now.

Long-term, we're bullish Equities in India and around the world, but are remaining patient in the near-term due to momentum and breadth divergences we've been seeing across major indexes, sectors, and individual names. It's happening in the US too.

We've been writing about this for a few weeks, so I wanted to follow up today and show the progression of that thesis.

From the desk of Tom Bruni @BruniCharting

Healthcare Providers quickly went from hero to zero in Q4 of 2018 after a failed breakout and bearish momentum divergence, but we're beginning to see signs of a potential mean-reversion over the short-term.

Let's start with Healthcare relative to the S&P 500, which has been unable to find its footing since topping 5 months ago. Prices have now retraced 61.8% of their 2018 rally, which may offer some short-term support and transition the trend from down to sideways.

Click on chart to enlarge view.

From the desk of Tom Bruni @BruniCharting

New Mystery Chart!

For those new to the exercise, we take a chart of interest and eliminate the x and y-axes and and all labels eliminated to minimize bias. The chart can be any security in any asset class on any timeframe on an absolute or relative basis. It can even be inverted or a custom index.

The point here is to not guess what it is, but instead to think about what you would do right now. Buy, Sell, or Do Nothing?

From the desk of Tom Bruni @BruniCharting

Telecom continues to hold up well, sticking with the "reach for yield" theme we've been discussing month in and month out for a while now.

Let's take a look at the ETF and a few individual names we want to be buying to take advantage of this trend.

From the desk of Tom Bruni @BruniCharting

The market remains a “hot mess", so we’re looking under the surface at breadth and risk appetite measures to identify clues as to the potential direction that this 15-month range will resolve itself.

Today I want to look at one of those measures, Consumer Discretionary stocks vs Consumer Staples.

If you're a long-only fund manager that believes the market is headed higher, you're going to be in more aggressive areas of the market like Discretionary. If you believe the market is headed lower or isn't going to do much, you're going to be in the lower beta, often higher dividend Consumer Staple stocks.

So what's happening in these sectors right now?

The Equal-Weight Consumer Discretionary vs Equal-Weight Consumer Staples continues to struggle with a flat 200-day moving average and confluence of support/resistance, but just made new 6-month highs this week. While this chart still work to do to confirm an intermediate-term uptrend, this is extremely constructive action and is suggesting that risk appetite among market participants is beginning to pick up.

Last week's Chart of The Week discussed the "One More High" type setup we often see  prior to price consolidations or pullbacks, providing some context around why we continue to remain structurally bullish, but not very aggressive in the short-term.

Friday we got new Monthly Candlesticks, so this post will outline a few of the major changes since last month.

From the desk of Tom Bruni @BruniCharting

One of the topics I spoke about during my Chart Summit presentation on breadth last month was the relative performance of Equally-Weighted versus Cap-Weighted Indexes.

I always hear that the market cannot go higher on an absolute basis if the Equally-Weighted S&P 500 is underperforming the Cap-Weighted.

So is that the case? Let's take a look.