relative strength of staples vs the S&P importance
Posted on December 23, 2013 Leave a Comment
in order to get up to speed, if you have not been following, please see the following post:
https://bartscharts.com/2013/10/07/staples-strength-vs-the-sp/
we completed a perfect price/time pattern BUY on the ratio and it did, in fact, respect the pattern level. HOWEVER, since then we have taken out the lows of that pattern and if we go back you’ll see that the .786 was ‘still a target.’ the importance of this ratio cannot be overstated – at every major inflection point since 2000 (I don’t have data that goes back any farther) it has pointed to all of the tops and bottoms of the market. perhaps we’ll go down and tag the .786 … what I can say, is if we blow thru the .786 then it will show a lack of institutional fear in this market as the thesis is the staples start to out perform as rotation occurs in a volatile or bearish market. so far, this ratio has been stagnant and correcting for a very long time … let’s stay tuned and see what a little lower does for our ratio.
additionally, I have included the WMT gauge. please see these posts to get a feel for the importance of this ratio:
XLP/SPX – looks like lower target to get tagged …
WMT/SPX – little lower …
the importance of the recent reweight in the S&P 500
Posted on December 21, 2013 1 Comment
yesterday was a quarterly option expiration AND an important S&P reweighing .. our last post at the sectors of the S&P 500 were dominated by technology, energy and financials … that changed, pretty substantially. now, hot of the presses the sectors are:
- information technology 18% : using VGT as a proxy. see chart below. SELL PATTERN complete/completing.
- financials 16.4%: using XLF as a proxy. see chart below. SELL PATTERN complete/completing.
- health care 13.1%: using XLV as a proxy. see chart below. no discernible pattern however it’s approaching PARABOLIC
- consumer discretionary: 12.5%: using XLY as a proxy. see chart below. no discernible pattern however it’s approaching PARABOLIC.
- industrial 11.1%: using XLI as a proxy. see chart below. SELL PATTERN complete/completing
- energy 10.3%: using XLE as a proxy. see chart below. no new high, an extension sell pattern complete at 88 but perhaps 97 is where it will go.
so, note the inclusion of health care, consumer discretionary and industrial and there close to parabolic states continues the advance. additionally, am using VGT and the NASDAQ as proxies for the IT sector. 70% of the S&P 500 are either approaching parabolic or SELL patterns are completing …
stand by …..
financials
health care
consumer discretionary
industrials
energy
Around the world update …
Posted on December 21, 2013 1 Comment
https://bartscharts.com/2013/09/14/part-1-the-sp-500-but-first-we-need-to-go-around-the-world/
the first post going around the world was in September … nothing has changed. No other stock market – except the US – has come close to their 2007 highs …
our first hint we are soon to be carving out a bottom in Gold …
Posted on December 20, 2013 Leave a Comment
as a pattern recognition dude, I simply look for patterns and try (it’s hard) to be objective and go w/ it. if you have been following we’ve been doing OK w/ everything BUT the equities. Patterns haven’t necessarily failed, but they are being tested for failure, that’s for sure. the bullish sentiment is at ALL TIME HIGHS for the past 30 years …
on the other hand http://www.marketwatch.com posted this today: http://www.marketwatch.com/story/golds-13-year-bull-run-breaks-with-29-annual-loss-2013-12-20?dist=countdown . my past couple posts on Gold and Silver have shown how I “think” we are carving out a 5th wave that could be the BUYing opportunity. As the pattern to BUY appears the PRESS will be declaring it’s no good, get out of Gold and we’ll stop seeing those CNBC adds about silver and gold and metals ETF’s …
so, I recommend not yet, but this is my first “quick look” that a low in th emetals for either a MAJOR bounce or an eventual march higher is w/in the next quarter or so …don’t jump the gun, yet.
the Copper Script …
Posted on December 20, 2013 2 Comments
if you have been following my blogs of late, you’ll find that I’ve been throwing some bearish patterns out there. simply, there are bearish patterns. period dot … they work, they fail and we manage RISK. just to show you that I am agnostic to the BULL and/or BEAR case here’s the falling knife of copper and the BUY recommendation that was put out … the FORM/PROPORTION/GEOMETRY was PERFECT. enjoy ….I still think Copper is a big deal.
Copper and China
Posted on December 20, 2013 Leave a Comment
the count (long term) for copper appears to have completed a very well defined 5 wave move … if this is correct, then perhaps we have a little larger rally to kiss the neckline and then down into much lower prices. why is this important to China? well, from a chart view they are aligned extremely nicely. so, IF Copper is going to go down THEN so should FXI if the correlation holds …
the Musical Swissy …
Posted on December 19, 2013 Leave a Comment
what a week in the FX markets … amazing. if you have been following along, I have been a DOLLAR BULL the past couple weeks awaiting for what I THINK is the end of a correction that is going to set up a pretty large and powerful rally in the US Dollar.
that being said, one of the key components that everyone involved in the FX watched is the USD vs the Swiss Franc (AKA the SWISSY)
what I saw was an “ending diagonal” that was nicely showing us 5 waves down and that would have represented the end of a somewhat “flat” correction that started in July 2012. Yes, it’s been 1 year and 5 months since the high….and, think about it, it’s ONLY retraced right in/around .382.
as I followed this last move down I naturally thought we would get a bounce in/around the pattern called a zig-zag/ab=cd/equality of moves/etc. In fact as you can see, it did bounce rather strongly in/around that level (to be exact) however, the wave count wasn’t complete. so, we did one more wave down and hit exactly at 1.05946*a = c. With that level being hit, we have a weekly signal reversal and, additionally, we are selling off rather nicely w/ the Euro and the Dollar Index appears to have bottomed. Also, note the TIME component. IF we have the PRICE w/ a 1.05946 component THEN we have 27 weekly bars in the ab move so 1.0594*27=29 and that give us an PRICE and TIME equality.
as we have seen this past couple weeks the musical note ratio’s are doing some nice work in the markets. I have a small 5×7 card w/ the ratio’s and, now, they are basically memorized. recommend you do the same – they make great stop placement levels. (see GOOG 1.68179 extension target) If those of you want the why – check out this website – http://www.brooksdesign-ps.net/Reginald_Brooks/Code/Html/Gomas/gomas09.htm
if we get below .8832 then all of this is jibberish ….
Silver following the script part IV
Posted on December 19, 2013 Leave a Comment
I would encourage anyone new to this blog to go thru the following past blogs to get an update on where we are ….the link is here:
https://bartscharts.com/2013/11/20/silver-following-the-script-part-iii/
the big question “is the high in/around 50 a wave III or a wave V?” I REALLY like it being a wave III because the current correction in form/balance is SO NICE. If that is the case, we are in the midst of the 5th wave of C that will take us into the 14 area for a really really powerful BUY. I have shown the 11 area based on the length of the corrective move from the old high in the 1980’s.
we have a beautiful zig-zag (3-3-5) correction working …. in the case of the 14 dollar level we have a=c and w/in the context of the C wave we have wave 1 and wave 5 being equal and then they land right on the .786 from the low in 2002. that is the PATTERN we have been following and tracing …
yes I know that silver is becoming overtly bearish from a sentiment perspective and w/ a very strong dollar forecasted is another 20% percent correction into the March 14′ time frame to out of the question?
E-mini update
Posted on December 18, 2013 Leave a Comment
here’s the last post on the e-mini:
https://bartscharts.com/2013/12/10/emini-update-10102013/
key juncture for the bull/bear case … either way, I think we are terminal. it’s either HERE after the FED meeting OR we’ll cook it off and rally into the new year and then pull the plug. I have presented both pictures below ….something to keep in mind. what do “they” have in mind at the end of the week. a very large reweight is to occur on Friday w/ the introduction of Facebook into the S&P 500. so, that means there will be a LOT of STUFF for sale. Stuff is the proprietary list of names (supposedly) that will be worked (manipulated) by the arbs to get it done. in addition to that we have some extremely long term SELL patterns occurring across a multitude of instruments.
and, don’t forget the USD. that will be KEY moving forward as we’re certainly “thinking” we have carved out a bottom on the USD index. we’ll see ….
one last, nice full moon yesterday … just be aware that has proven, in the past, to heighten volatility.
so like NFP, I’ll be sitting this one out. no need to think I can play in the world of high frequency trading, hedge fund gorilla’s juggling dynamite and Goldman Sachs knowing exactly what is going to happen before it happens. I’ll check in around the Asian open to get a feel. Certainly hope that high on the EURO doesn’t get taken out. make it a great day …
PS — POUND pumped up today – a SURPRISE in their jobless numbers. Guess we are final “recovering” after the 4 year recovery? things that make you go hmmmm
cheers!
SBUX monthly signal reversal candle a couple bucks away
Posted on December 17, 2013 Leave a Comment
here’s the post on SBUX:
https://bartscharts.com/2013/11/03/sbux-and-coffee-futures/
the RELATIVE STRENGTH of Coffee Futures to SBUX has a montly BUY signal and the post above showed how inflections of Coffee relative strength w/ regards to SBUX usually gave one a “heads up” on price action. the geometry of the PATTERN at/around 81 is presented, again, below. a monthly signal reversal candle (SRC) is around 74.51.
SBUX potential targets and count that doesn’t break any rules (valid (?))
SBUX SELL SIGNAL monthly approaching
Bart's Charts 