Thank you to everyone who registered for the new All Star Charts membership. I'm super excited to have you guys as part of our team. Remember, we're all in this together trying to navigate through this market day in and day out. It’s a puzzle that is constantly evolving and what we’re here to do is look for major trends around the world and then break those down to find more intermediate-term investing opportunities based on those structural setups. The new All Star Charts was an idea we’ve been working on for a long time, so we couldn't be happier to finally be able to share the ideas and the homework that I already do with all of our new members. Welcome to our club!
For the past 2 months I’ve been very vocal about how there’s been no reason to own the major U.S. Stock Market Averages. If there’s been any trade to be made, it's
We have to trade and invest in the market that we have in front of us, not the one that we want. Therefore we have to be able to approach the market from a completely unbiased perspective. We don’t care if the market doubles in price or if it gets cut in half. We want to try to take advantage of moves in both directions. This is America after all.
I know it’s not sexy, but since October 23rd, we have wanted to approach the major U.S. stock market averages from a more neutral perspective. This is the day that both the S&P500 and the Dow Jones Industrial Average first got above what was then, and still is, a flat 200 day simple moving average. Securities in that sort of environment create headaches, for both the bulls and the bears. The reason is because
there is no trend. Sure enough, prices this week are exactly where they were on October 23rd. This should not be a surprise and in fact, should be expected. But what does stand out is the dramatic underperformance in
For the past few weeks I’ve been writing a weekly open letter to readers about what I’m seeing across the stock market, bond market, commodities and currencies. The feedback I’ve received has been unlike any other time in the 5 year history of All Star Charts. I want to thank all of you for that. I think this is something that I will have to continue to do and make it a regular part of my routine. I’ve done this sort of thing in the past while managing money in order to keep our investors up to date on how we want to approach the marketplace. The format you’re seeing here is no different. Please feel free to keep emailing me and contacting me via Stocktwits or Twitter on how it can improve and what sort of things you guys want me to talk about.
Starting with the U.S. Stock Market, this as a group continues to be in no-man’s land. When price is near a flat 200 day simple moving average, the market is suggesting that there is
Last week I published an open letter about the current market environment and went over a lot of the things that I’m seeing out there in stocks, commodities, currencies and interest rate sensitive markets. I have to tell you that I’ve never received so much positive feedback from anything I’ve ever written. All Star Charts first launched 5 years ago and I’ve been writing and sharing ideas on the platform pretty much every single day since. I’ve written thousands of posts and shared 10’s of thousands of charts, but you guys came back to me last week more than you ever have in the past. I want to thank you for that.
It seems more appropriate now than ever to follow up with some of the things that I’m seeing today.
I look at stock markets and asset classes all over the world to approach the marketplace from more of a weight-of-the-evidence, top/down perspective. This way I can formulate a thesis, confirm that by what I’m seeing elsewhere, and then put together a plan that presents the best risk vs reward scenario in order to best execute going forward.
"Sell into strength" is still our big theme right now. We're not trying to buy dips. To the contrary, any opportunities that we get to sell into, we want to take. The weight-of-the-evidence suggests there is way too much overhead supply to get aggressively long for more than just a few days. We maintain a more intermediate term time horizon so a buy-the-dip strategy still makes little sense to us in the current environment.
