This is the video recording of the June 2020 Conference Call.

From the desk of Steve Strazza @Sstrazza

For the week ended Friday, June 12, 2020:

Every week we publish performance tables for a variety of different asset classes and categories along with commentary on each.

Last week was a big one for the bears as most risk-assets sold off aggressively to end the week after a strong start.

Many major Indexes in both International and Domestic Equity Markets printed bearish island reversal patterns, most of which occurred at logical levels of overhead supply. Read our post about it here.

We also just wrote about how the market's secular leaders are holding up best since market internals peaked about two weeks ago. We're going to use our US Index and Sector tables below to highlight the noteworthy relative strength from these areas amid the recent market weakness.

Let's take it from the top and begin with our US Index ETF table.

When stocks as an asset class are in a strong uptrend, or "bull market" as some like to call it, they don't just perform well on an absolute basis, but they also tend to outperform their alternatives. Two perfectly good alternatives to owning stocks are Bonds and Precious Metals.

As you can see in this chart, in early March the S&P500 broke key support relative to both US Treasury Bonds and Gold. All of that former support since 2018 "should" turn into resistance, based on our polarity principles.

And it did:

As part of our Top-Down Approach, it's important to consider all asset classes around the globe.

In our Five Bull Market Barometers we cover what's happening in Commodities and Fixed Income, and we wrote about the Rupee here, so this post is going to focus on what's happening in Equities.

Since global markets are highly correlated, it's important to understand what's happening in Equities around the world before we get into what's happening in India's major indexes and individual stocks.

This week's talk of the town in the Technical Analysis community is the "Island Reversal", and rightfully so, as some of the world's strongest indexes are sporting this pattern.

Let's take a look and get into what it could mean for the days/weeks ahead.

From the desk of Tom Bruni @BruniCharting

Two weeks ago I wrote about the downside resolutions in Treasuries and Yen and the questions we would be asking in the days following. Given their rallies in the last week, we continue to ask those questions and observe what messages these "safe haven" assets are sending about the market.

This week's talk of the town is the "Island Reversal", and rightfully so, as some of the world's strongest indexes are sporting this pattern.

Let's take a look and get into what it could mean for the days/weeks ahead.

In early May we outlined the "Five Bull Market Barometers" we're watching to identify the beginning of a new bull market in stocks.

If you haven't read our initial post linked above, we'd encourage you to check it out so you understand what the rationale behind these five indicators is.

Now that the market has pulled back from its overhead supply, let's take a look at where these long-term indicators stand.

From the desk of Steve Strazza @Sstrazza

It's been a close your eyes and buy anything market, particularly the past few weeks as even the most hard-hit areas experienced monster rallies. That appears to be changing this week with the biggest 1-day down move in the S&P since mid-March as well as the largest single-day spike in volatility since February 2018.

Last week we highlighted the healthy rotation into cyclicals. We pointed out that the secular laggards and areas that had suffered serious structural damage were now outperforming, and by quite a wide margin.

We used this scatter plot of our Dow Jones Industry universe to illustrate this price action.

Relative strength charts are a great tool to identify where the big money is flowing into and out of.

Today, we're looking at a chart that suggests one sector is getting ready to outperform the broader market again.

From the desk of Steve Strazza @Sstrazza

We’ve written extensively about the split market we’ve been in for the better part of the year, as the same leaders coming into the Q1 crash emerged as the strongest areas coming out of it. Over the past 3-4 weeks we’ve seen some major mean reversion and much-needed participation from the cyclical sectors which have been lagging for years now.

This is constructive rotation and a major positive for bulls as we’re going to need to see this type of breadth expansion if this rally is to have legs.

While this is an encouraging development, there’s one thing that hasn’t changed at all. With all the focus on Financials, Industrials and Energy recently, Tech seems to have been forgotten a bit, but it’s still by far the best game in town.

The Nifty Pharma sector has been a favorite of ours since last November, with many trade ideas popping up along the way.

Today, we're doing a deep dive into the sector to identify the strongest names that we'd want to be buying on any weakness that may be created by the Nifty 50 and other major indices reaching overhead supply.

From the desks of Steve Strazza @Sstrazza and Tom Bruni @BruniCharting

In this post, we're going to share 10 of the most important charts we're looking at right now. Some are merely for observational purposes or to highlight some of the broader trends at play in the markets while others are trade ideas in some of our favorite names and areas.

Let's dive right in. Here they are.

One of our "Five Bull Market Barometers" is the Nifty 100/Nifty Small-Cap 100 ratio due to its importance as a measure of risk appetite.

Today, we want to look at a more concentrated version of this ratio, the Nifty 50/Nifty Small-Cap 100, which is a major inflection point.

Let's discuss what's happening and why it's important to our broader view on Equities as an asset class.