Copper is important for a variety of reasons, but it's often discussed within the context of global growth expectations.
Given we just hit 2-year lows it may be a good time to discuss Dr. Copper, why he may be headed into "critical condition", and what it could mean from an intermarket perspective.
For those new to the exercise, we take a chart of interest and remove the x/y-axes and any other labels that would help identify it. The chart can be any security in any asset class on any timeframe on an absolute or relative basis. Maybe it's a custom index or inverted, who knows!
We do all this to put aside the biases we have associated with this specific security/the market and come to a conclusion based solely on price.
You can guess what it is if you must, but the real value comes from sharing what you would do right now.Buy,Sell, or Do Nothing?
In this Episode of Allstarcharts Weekly, Steve and I talk about the recent strength in Gold, even in the face of a Dollar that has yet to start falling. After Thursday and Friday's turn around, I think it's finally time for the Dollar to weaken. The way I see it, the relative strength we've seen in Gold was a heads up that the Dollar is set to fall. The correlation between Japanese Yen and Gold Miners on a relative basis is the intermarket relationship that stands out the most.
Wednesday morning I outlined the charts we were watching ahead of the Fed Decision and what we would need to see before getting out of the way and reevaluating our bullish Equities and US Interest Rates thesis.
Today I want to look at those same charts and note what's changed and how we're moving forward.
We've wanted to be erring on the long side of stocks if the major Indexes are above their 2018 highs. That has been the strategy for the second half of 2019. But what if we're not above those highs? Then what?
I've made no secret about it. I've been bullish on Twitter -- the business -- since I first discovered the power of the platform in 2009. To say that Twitter has profoundly changed my life for the better would be a vast understatement. Sure, the company has social, ethical, even financial challenges. But Twitter is one of those companies that if it disappeared tomorrow, it would have a huge negative effect on me. I can't say that about most businesses I interact with.
Finding opportunities to invest in the stock of Twitter -- $TWTR -- has been a bit trickier.
This is the question I often ask myself. In which direction is there the most risk? Are we better off looking for stocks to buy or looking for stocks to sell? There is no need to make this complicated. Where are the probabilities of success skewed in our favor?
You're well aware by now that I spend a lot of time looking through charts in the U.S. and around the world. We have Indexes, Sectors, Stocks and other assets throughout My Chartbook. One thing I learned a long time ago is to also pay attention to the bellwethers. It's a word that gets thrown around a lot, but we take it a little more seriously around here. There are only a few of them and today I want to draw your attention specifically to what is happening in shares of J.P. Morgan.
Today will be a "big" day for markets as the Federal Reserve will announce their decision on the new target Federal Funds Rate.
Currently, markets are pricing in a roughly 80% chance of a 25bp cut and a 20% chance of a 50bp cut. This means market participants have assigned 0% odds to rates remaining where they are after today's meeting.
We've been pretty clear over the last few months about where we stand regarding the different asset classes, so there's not much left to do other than wait and see how prices settle by the end of the week.
With that said, here are a few charts we're watching through Friday's close.
