From the desk of Steve Strazza @Sstrazza

Check out this week's Momentum Report, our weekly summation of all the action from a Macro, International, Sector, and Industry Group level.

By analyzing the short-term data in these reports, we get a more tactical view of the current state of markets. This information then helps us put near-term developments into the context of the big picture and provides insights regarding the structural trends at play.

Let's jump right into it with some of the major takeaways from this week's report:

* ASC Plus Members can access the Momentum Report by clicking the link at the bottom of this post.

Macro Universe:

• Our Macro universe performance was positive across the board this week, as 81% of our list closed higher with a median return of 1.57%.
• The biggest winner of the week was Oil $CL, which gained 10.30%.
• Meanwhile, the week's worst performer was the Volatility Index $VIX, which fell by -11.69%.
• Several US Large-Cap indices finished the week at all-time highs.
• Oil $CL posted a bullish reversal week.
• Only about half...

This is one I get asked about all the time.

"JC, are there any books you recommend for someone trying to learn more about Technical Analysis?"

The answer is yes. Of course.

The thing is, back in the day when I was studying for my CMT exams, there wasn't a well-defined curriculum like there is today. This was back in 2006. They would just give us a list of books to read and wish us the best of luck!

I really enjoyed that, actually. To this day I still tell people to go through the curriculum like they ask you to, but then go back and read the books too!

Now, if I had to do it all over again today, this is what I would do:

This week we’re looking at a long setup in the IT Sector. IT is trading at all-time highs, and displaying the strength you'd like to see at an index as well as a stock level.

Let's take a look at the trade idea this time around.

When Consumer Staples are underperforming, what type of environment are normally in?

Staples are making new multi-decade lows relative to the S&P500 and flirting with a catastrophic breakdown relative to Consumer Discretionary stocks:

We retired our "Five Bull Market Barometers" in mid-July last year to make room for a new weekly post that's focused on the three most important charts for the week ahead.

This is that post, so let's jump into this week's edition.

It's Saturday Morning Chartoons time. 

This is the weekly post that aggregates all the charts we put together throughout the week and organizes them all into one, easy to flip through deck.

You can find the whole list of trades here.

Below you'll find the full PDF of this week's charts:

 

 

From the desk of Steve Strazza @Sstrazza and Ian Culley @Ianculley

Pockets of strength continue to emerge within commodities.

This could be hard for some to believe when we see things like energy chopping beneath overhead supply.

Or the fact that precious metals persist in slumming it as some of the worst-performing assets on the planet.

But this is a diverse asset class with plenty of bright spots that suggest strength and support our thesis of a new commodities supercycle.

We’ve recently covered breakouts in Sugar and Feeder Cattle that are both still in play.

Even some of the laggards, like Silver and Lumber, recently defended critical areas of support.

This week, it was impossible to miss the chart of Oat futures. Let’s have a look!

Here’s a weekly chart of Oats:...

From the desk of Willie Delwiche.

While what’s happening beneath the surface in US markets is a bit frustrating, we are seeing evidence of improving breadth on a global basis. Just shy of 75% of ACWI markets are trading above their 50-day averages, the highest level in more than two months. For comparison, 63% of S&P 500 stocks are above their 50-day averages. Broad global strength is important for the S&P 500 (especially given the current lack of a breadth-thrust backdrop) and could be critical if global equities are going to move into a leadership position as we move toward the end of 2021.

From the desk of Steven Strazza @Sstrazza and Grant Hawkridge @granthawkridge

For the better part of 2021, we've been pounding the table about markets being a chop fest. And we'd seen little evidence suggesting this was likely to change any time soon--until this week, that is.

Trendless… range-bound… call it whatever you want, but the path of least resistance for stocks and many other risk assets has simply been sideways!  

Alas, we’re seeing some strong bullish action this week that we simply can’t ignore. Let's talk about it.

Before we get there, though, let’s take a step back and look at small- and micro-caps, as they provide great illustrations of this sloppy stock market story...

SMIDs and micros have not been able to make any real progress for most of the year. 

Pretty much everything outside of the large-cap averages have been chopping around in a range since Q1. This had reinforced our view that these messy conditions were likely to persist for the foreseeable future. But there's something brewing...

In the early days of Crypto, we were taught to believe these were currencies.

And in the case of Bitcoin, maybe it is. But when you go down the cap scale, these things are no different than stocks.

For me they're "Tech" stocks. For Howard they're "Software" stocks.

Either way, we agree that these are just more stocks we can trade. And if you choose not to, well then you're leaving a lot of alpha on the table.

Why would you purposely choose to ignore this particular group of names?

Howard and I discussed all of this during a livestream this week.

Enjoy!

This is the video recording of our August 27, 2021, All Star Charts Crypto Weekly Strategy Session.

 

The ASC team published an Under the Hood report last week in which there were a bunch of interesting opportunities to choose from. But I held my fire -- until now.

After letting these ideas marinate a bit, I've been liking the pullback and solid support holding in one of the names. 

Let's get right to it.