Revisiting the R2K – If History is Correct, Downside Risks Remain Elevated over Intermediate-Term
On 5/31/12 we ran a post on the R2K that suggested, based on its current price structure and momentum in the context of history, the path of least resistance for the index was lower, not higher, over the intermediate term…....
Nat Gas’s 40% Rally off its Lows Has Proven Little From a Long-Term Perspective
Earlier this year Nat Gas broke through a 20 year support line (1) rather forcefully. Since then the commodity has rallied ~40% off its proximate decade-long low of ~$1.90. That rally has taken it back up to its first noteworthy…...
Bio-Techs, a Leadership Group, Face Stiff Resistance (Same Resistance Faced at top of SPX Bear Market Retracement Rallies in 2001/2008)
Below is a table (via Finviz.com) that details YTD industry performance – biotech has been a standout YTD, up 22% and in 11th place out of all industries. That said, in the chart below the group’s YTD rally, via the DJ…...
More Analysis Around the Potential for a Greek Exit / Drachma Reintroduction
A short while back we ran some detailed analysis on historical currency devaluation episodes and suggested that should Greece exit the Euro and reintroduce the Drachma, the time to buy Greek equities on a nominal basis would be at the time of…...
Why has A Stock with a Great Fundamental Backdrop Fallen 40% in a Month? / The Power of Technicals
The chart below is of RGR (Sturm Ruger), a well known firearms manufacturer. The fundamental backdrop for this stock and its industry is excellent – obviously driven largely by fears of Obama’s perceived anti-gun rights political leanings. So, why then is…...
Downside Accelerating in the Shanghai Composite; About to Break Down Technically?
In its last two trading sessions the Shanghai Composite has shed 140 and 160 bps, respectively. At the same time the index sits on trend-line (1) support dating back to 2006 within the context of a broader pennant/flag consolidation pattern…...
Outcomes for Equities Here & Contingency Planning for Each Potential Set-Up
I think there are two potential outcomes here: 1) Per the first chart below – the SPX daily – there’s a chance that the move off the late May / early June lows of ~1,280 and the choppy consolidation that then…...
How the Use of An Analog Would Have Had you Long at SPX 1,075 on 10/3/11
The chart below analogs the periods of July 1986-December 1987 and July 2010-October 2011. Without going into the additional historical statistical details of how one would triangulate or back into 1,075 as “the” point bottom to buy on 10/3/11, the…...
SPX Creating an Incredibly Bearish Wick at Important Resistance
If today’s losses hold through tomorrow (a BIG if), the SPX weekly chart will look like it does below (or worse). In that chart you can see the SPX has put up an incredibly bearish looking wick at important resistance…....
Did April Witness Another Failure at the SPX’s Most Important Technical Line in the Sand Dating Back to the 80s?
I find technicals so inherently valuable because they offer such clear parameters for identifying where something has changed (or not). They offer great lines in the sand in terms of facilitating improved exeuction – long here / short here. So,…...