Friday we wrote about the US Dollar breaking out to 1-year highs and why it's one of the most important charts we're watching from an intermarket perspective. With that said, we always look at both sides of the story, and while the US Dollar breakout certainly adds to the bear case for Precious Metals, I want to use this post to explore all of the current bullish and bearish characteristics of the space.

It's not about being right, it's about making money. There's a difference and I think that gets forgotten too often. We want to position ourselves where we have the highest probabilities for success as well as where the risk vs reward is skewed in our favor. The goal is not to be right every time. The goal is to be profitable. That's why we're always thinking worst case scenario: always a risk level and always a target.

Today I want to focus in on what we're seeing in the S&P500 because I think that from a risk management standpoint, this 2780-2800 level is a big one today from a structural perspective. Until now, we've used 7000 in the Nasdaq100 and 2650 in the S&P500 as our lines in the sand. We've only wanted to be long if we were above those levels and that has worked out very well. Moving forward, I've identified some higher levels that we need to monitor.

As part of our ongoing partnership with Investor's Business Daily we have added all of the IBD50 components to our equity research coverage. We are updating our Chartbook on a weekly basis and members of Allstarcharts have access to that workbook here.

Today, I wanted to discuss what we're seeing from this group to identify the overall trend for U.S. stocks and also to find trading ideas to profit from that directional move. 

This index is made up of stocks showing both relative strength and positive momentum, in addition to other factors that play a role in adding or removing components from the list of 50. What attracts me to this group, however, is the relative strength and positive momentum, just to be clear.

This is the Innovator IBD50 ETF $FFTY which to me, is still in an uptrend. We want to continue to err on the bullish side of this ETF and the group as a whole:

Life isn't just about Tesla gossip and Apple at a trillion. There is plenty of "less sexy" market behavior to be paying attention to right now that should have serious implications for the overall market. While boring to some, we have a huge amount of respect for Berkshire Hathaway stock. The breakout we got this week is likely to be the beginning of a 25% move higher which should take this one close to a $700B market cap and we want to be buying!

I could not be more thrilled that it's the end of the month for one reason alone: Monthly Candlestick Charts. They get me every time! It's easy to get lost in the every day noise surrounding the market. The chart review I do heading into the first of every month is one of the most important parts of my process. It brings me home. There's no better way I know to maintain composure and recognize trends than this monthly music and chart session!

Since June of 2017 when the S&P500 broke out above 2400, we've had a target of 3000. After close to a 4% rally in the S&P500 Index this month, we went out just 6 points from a new all-time high monthly close. This is not any evidence we think suggests anything has changed. To the contrary, higher prices are things we expect to see in an uptrend:

The original inspiration for the monthly conference calls for members of All Star Charts came from the benefits of the Question & Answer sessions. We have really smart and experienced members and I think everyone can get value from this process, myself included.

Over the years, our conference calls have gotten much more in depth and to keep the videos under an hour, we simply have not had as much time for Q&A as was originally intended. Therefore, starting this month I will be hosting a video Q&A which will be archived for everyone to watch.

If you have any questions, you can fill out this form and I will be answering them in a video on the evening of August 1, 2018.

Please note that this form is not a pop-out window or link, just enter your name and question directly below in the spaces provided.

From the desk of Tom Bruni @BruniCharting

This post is part two of the semiconductor discussion that began here, with us outlining the current trend in Semiconductors from the top-down. If you've not read that yet, I suggest you do as this post will focus on the specific stocks we want to be involved in to capitalize on the eventual continuation of this sector's uptrend.

This week I was in New York meeting with partners and old friends. On Tuesday I was down at the Bloomberg Headquarters chatting with Catherine Murray about what we're seeing from a technical perspective. We discuss Technology, Medical Equipment stocks and where we are within this secular bull market. Here's the video of the interview:

Here is the latest video on our Youtube Channel: Railroad Stocks and what it could mean for the overall market!

From the desk of Tom Bruni @BruniCharting

Throughout April and May we've discussed market breadth improvements that have us bullish on equity prices both in the US and globally. Today I want to perform a simple exercise to see how the data we're looking at has developed over the last two months or so of trading.