Ratio Ratio Where Art Though ….

below is our ratio .. if you remember my last post, we were talking about a monthly or weekly close BELOW the consolidation and the market would take off … it started but jumped back into the channel and has been climbing ever since.

what has happened in the market? some interesting selling … but is THE TOP IN?

honestly, have no idea nor do I care if it is or it isn’t. all we know is we now watch the top of the channel … if that gets attacked and we get a weekly/monthly close ABOVE then a health meltdown could occur.

for now -just in the middle of the channel folks. looks like it wants to go higher to hit the upper channel – that’s what its been doing – so why not? higher means some more volatility / selling but nothing to freak out about, yet.

so what do you do? here’s something easy … if your a bul or like buying then BUY the TOP of the channel and if your a bear and like to sell then SELL at the bottom of the channel.

it’s going to be very interesting. hit me w/ any questions …

UNG – Natural Gas – catch the next wave?

last post on NAT GAS / UNG: https://bartscharts.com/2021/11/01/ung/

the game plan/strategy is to BUY the first PATTERN in a “new” trend and if it works then probability is that the trend change is real …

Energy, Ags, etc. are exploding of late and GLOBAL shortages that are becoming apparent pretty much every day are REAL. so, if one thinks (trade what you see not what you think) that Nat Gas prices are due to continue to rise then we have UNG that will give you exposure.

if we break thru the low at 13 then I would consider this a failed pattern but we have some MAJOR support coming in/around 15 for the BUY to get long nat gas and, perhaps, hold this position for a LONG time …

it’s all probability folks …

below, you will see a MONTHLY on UNG since inception. wanted to post this chart so you could see why I wrote the above .. have we broken out in Nat Gas? have we begun a new bull trend? full disclosure, I’m long UNG down in the single digits and will be looking to ADD to my position at this pattern completing – if it ever does.

take note of the volume picking up and the fact that the RSI is at it’s highest level .. the key here, in the coming ongoing pullback, is where the RSI finds support … if we find support on the BULL ZONE (around 40ish) then we can start giving our change in trend some more probability … but, for now, we are speculating that a very investable low is in place .. don’t throw the farm at this one .. nibble at it … as we will see the breakout occur and there will be more time to get LONG if the “low in place” thesis is correct.

additionally, the “length of the base equals the price target potential is also nice here .. we’ve been basing for 6 years and, if you want to split hairs probably 10 years once that low was put in place 2012. bottom line, if this things goes higher, it’s going to go ….

another way to check trend is via long term LOG charts .. LOG’s help you understand rates of change and are very good at giving first hints of big changes in trends or inflections …in looking at this on the long term log scale, certainly appears to have broken the long term log trend line …

last, when you are building a position, it’s wise to see how “strong” or “weak” that security is compared to high fast flyers .. in this case, for no other reason than randomness, I chose UNG/NFLX.

yup, Natural Gas has out performed (on a relative strength basis) NFLX for all of 2020

there you have it …

manage the risk.

Bart

the ratio … interesting to say the least

as you all know, I watch the XLP/NYSE Index ratio for key inflection points .. when the ratio goes UP then “staples” (think risk off) have more relative strength and when the ratio goes DOWN then the overall market (think risk on) is stronger from a relative strength perspective

with the recent market action … one would think the ratio would have exploded higher .. well, yeah, no – it hasn’t. still stuck in the range it’s been trading since FEB 2021.

so, for those max BEARS you might want to watch this .. need an upside break out above the red line to get the party started and for the max BULLS need it to break down below the green line …

no idea which way it will go BUT I will tell you I was surprised when I took a peak at it during my nightly cruising of the charts … my “thinking” was that it would have been higher, much higer.

but we trade what we SEE not what we think … so, until the ratio closes above the red line I’m going to say this sell off is a much needed correction that will ultimately need to be bought … and if we break BELOW the green line, then, perhaps game on for another run.

tricky folks .. not going to tell you it isn’t.

been watching the XLP/NYA level …

last post: https://bartscharts.com/2021/05/05/xlp-nya-our-favorite-ratio-and-a-twist/

as the market continued to climb to new highs, if you look at the chart below you’ll notice that it did not move to new lows. no, in fact it has been basing since Feb .. almost 6 months. in a truly bullish environment, it would be game on and this ratio would continue lower. it did not …

in fact, it appears to have some strength and starting a breakout to the upside.

THAT, is not a bullish equity move … so, keep you powder dry. if you have been following my blog for a while you know how powerful this ratio (XLP/NYA) has been at warning about inflection points … yes, we have lower targets from the last post, but, for now, certainly appears that the ratio is/has bottomed and a “risk off” mindset appears to be taking hold ..

one last, I went in and fiddled w/ my settings and everything and can’t figure out why all the candles are green? maybe it’s that I’m using a “ratio” but I’m not sure, so I do apologize for any confusion. for whatever reason 4 candles are red …?

make it a good week.

Bart

XLP/$NYA – intraday update

XLP/NYA hit a nice buy pattern on Friday and based on the entire days action, there is another “minor” buy pattern appearing. if both of these hold, then the staples should continue to outperform which traditionally causes equity weakness.

if we lose the levels, then we have the .786 ratio a little lower … either way, the ratio should NOT take out the January 20 low, for now, as that was a pretty big target. sure looks like probability favors more upside for the ratio next week.

the last post on the XLP/NYA ration and the very important support which I submit is the “cause” of the recent weakness: https://bartscharts.com/2021/01/24/ratio-analysis-key-level-hit-on-the-xlp-nyse-index/

How logarithm’s, music and math yield 40,655 as a target for the DJIA

If you have gone down the rabbit hole that I have (hint it never stops) then you uncover tidbits of information that you would never think were important but one of those moments of “that’s cool” and move on …

I am eyeing a NICE currency position and then ended up cruising around the charts and was looking at Monthlies on a bunch of stuff. The charts reminded me of some of my early market music stuff and I figured I would go back and check em out …

Came across this long term DJIA chart ( I won’t bore you the importance of logs, numerology, blah blah and read the first sentence above. :)) It’s a technique for price projections that I learned from my friend and mentor, Michael Jenkins (www.stockcyclesforecast.com – RECOMMEND), and the results were pretty astounding.

I’ve shown some past blogs around the importance of the number 28.48. It’s a key PRICE NODE that has been at most tops and bottoms. So using it as a projection technique? Why not!

Then, you know I love music so … why not combine them w/ rates of change (logs) and … well the result is below. The use of logs and musical note ratio’s from the all time low on the DOW have been almost exactly the price using the log projection w/ the musical note E ratio.

The next appearance of this PRICE is 40,655 as annotated on the chart. One last, take a note of the blue arrows. the basic AB=CD lands, close enough, right on our target.

At this rate, from a timing perspective, it’s not that far off now is it ….?

Cycles are lining up, just saying.

Bart

below, note the symmetry of the projections and how, at least for now, EVERY MOVE, has been equal to each other and aligned w/ the Golden Mean.

DJIA 3 drives to a top pattern Monday 11/30/20

the two charts below are showing 2 three drives to a top pattern … the timing shows Monday 11/30 as the key date.

this chart is a 15 minute chart and showing the “three drives within a three drives” … kind of like Inception “dream w/in a dream w/in a dream” I guess ….

there are some higher targets but I would consider a daily close BELOW the gap area shown to be important for the bull case.

Banks – HUGE support

Banks are very important to the overall health of the market … key support approaching! monitor closely …

blogged about the banks a couple weeks ago here: https://bartscharts.com/2020/09/09/banks-where-are-they/ since then, they have continued to lose strength and now the Banking Index has a very important BUY pattern which should hold and the ratio of the Banks/NYSE Index has key support a little bit lower.

banks lead us up and lead us down so these areas below are KEY to strength of the overall market. bounce here/little lower on the ratio and we should stabilize. if we cut thru these levels w/out a whimper and continue lower then i would expect continued pressure down the line …

Banks – where are they?

there is an old adage – the banks lead you up and lead you down. the market has blasted to old all time highs or thru them and the banks…? well, they rallied a little but have not shown the strength of the overall market, especially technology.

let’s keep a close eye on them over the coming days and weeks … important.

here’s the support charts that I posted back in the past to show the patterns at work – it has NOTHING to do w/ me. I just pull out the crayons and try to find the patterns. keep it simple.

this chart was finding support at the “first” level after a pretty liquidating sell off from 112. pay attention … a LOT of math and patterns coming together. One of the key aspects of the chart below (if you have read this far) is watching for former FAILED PATTERNS.

as you can see, that level worked and the banks rallied … I apologize for not having the SELL pattern but I never posted it. Do you see it? After not making it above the 117 level it sold off big time … and, using some math and patterns we found a support zone ….

in the chart below I show you the SELL PATTERN on the banks. YES, this is after the fact and I DID NOT post this at the time but wanted to show 1/the harmony of this index and 2/ the pattern for illustrative purposes. the other reason for posting this is to demonstrate the bank rally off the March 2020 lows has been feeble …

and as we can see, the banking index / NYSE Index is tepid, at best. really don’t think the banks are too healthy right now …

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