Good morning and welcome to this week’s Flight Path. Equities remain in a “Go” trend and we see that a slightly higher high was hit last week but now the indicator is painting weaker aqua bars once more. GoNoGo Trend shows that treasury bond price have fallen back into a “NoGo” trend with consecutive pink bars. U.S. commodity prices have painted a weaker aqua bar at the end of last week after a strong run of bright blue bars and the dollar shows that it has fallen into a “NoGo” trend. After having painted a couple of amber “Go Fish” bars of uncertainty we saw a week of pink and purple bars.
$SPY Hits Another High But Paints Weakness
The GoNoGo chart below shows that the “Go” trend continued for another week and we even saw price make a slightly higher high on bright blue bars. However, immediately after, GoNoGo Trend paints a couple of weaker aqua bars as price fell from the high. GoNoGo Oscillator was able to rally off the zero line last week and is now back in positive territory at a value of 2. We will look for GoNoGo Oscillator to remain at or above the zero line in order for it to confirm the trend in price.
The weekly chart shows that on the longer time frame the trend has continued for another week however we see a second weaker aqua bar as price tries to consolidate at the highs. GoNoGo Oscillator is in positive territory but still not overbought at a value of 3. We will watch to see if price can find new legs here as momentum remains in line with the underlying “Go” trend.
Treasury Rates Found Support
GoNoGo Trend shows the trend continues this week and we see that rates found support at the horizontal level that we see on the chart. This level has proven to be important several times both as resistance and as support and we see that it is holding again as the “Go” trend tries to remain in effect. Having broken above resistance, rates fell to test that level and look to have found support. GoNoGo Oscillator likewise continues to find support at the zero line and is at that level again. We will watch to see if it can rally back into positive territory. If it can, we will expect rates to remain in the “Go” trend and potentially climb further.
Dollar Falls to New Low in “NoGo” Trend
The chart below shows that the dollar entered a “NoGo” trend this past week after a couple of amber “Go Fish” bars that followed a sharp drop from the last high. We saw Go Countertrend Correction Icons (red arrows) at that high as it ran up against resistance from prior highs. Now, having set a new lower low, price has rallied and will hit resistance from prior lows. We will watch the oscillator panel closely as GoNoGo Oscillator approaches the zero line. Should it find resistance at that level, we would expect price to remain in a “NoGo” trend.
Oil Climbs to new Highs in “Go” Trend
GoNoGo Trend shows that the “Go” trend has rallied and we see strong blue “Go” bars pushing price to new highs. These highs push price close to the highs from last summer and we will watch to see if there is resistance at these levels. GoNoGo Oscillator has soared into overbought territory and is at a value of 6. If momentum wanes, we will see a Go Countertrend Correction Icon (red arrow) indicating that price may struggle to go higher in the short term.
Gold Falls from Overbought Extremes
The trend in Gold remained in place this week but after weeks of higher and higher closes we see a sharp drop on the last bar of the week. GoNoGo Trend paints a weaker aqua bar and due to waning momentum we see a Go Countertrend Correction Icon (red arrow) indicating that price may struggle to go higher in the short term. GoNoGo Oscillator has crashed out of overbought territory and is now at a value of 2 and fast approaching the zero line. It will be important to note if the oscillator finds support at that level.
Sector RelMap
Below is the GoNoGo Sector RelMap. This GoNoGo RelMap applies the GoNoGo Trend to the relative strength ratios of the sectors to the base index. With this view we can get a sense of the relative out performance and relative underperformance of the sectors. 5 sectors are in relative “Go” trends. $XLE, $XLI, $XLB, $XLP, and $XLRE are painting relative “Go” bars.
Energy Sub-Group RelMap
The chart below shows a relative trend breakdown of the sub groups within the energy sector again this week. The Sub-Group RelMap plots the GoNoGo Trend of each sub index to the $XLE. We saw in the above GoNoGo Sector RelMap that $XLE is an out-performing sector and paints strong relative “Go” bars and has done now for consecutive weeks. When we look at the below RelMap we can see that the integrated oil and gas index in the top panel is painting strong blue “Go” bars on a relative basis.
$WFRD Breaks to New Highs In “Go” Trend
GoNoGo Trend shows that $WFRD has been in a “Go” Trend for several months and we have seen a series of higher highs and higher lows. We look to the oscillator panel and see that GoNoGo Oscillator has been primarily at or above the zero line, finding support at that level each time it is tested. Recently, GoNoGo Oscillator found support again at the zero line and we saw a Go Trend Continuation Icon (green circle) indicating that momentum was resurgent in the direction of the “Go” trend. This led to an attack on new highs and we see GoNoGo Trend painting strong blue bars as that high was made above resistance. We will look for price to consolidate at these higher levels before potentially moving higher in the coming days.
$YPF Breaks Above Downward Sloping Trend Line
The chart of $YPF below is bullish for a few reasons. We saw a new “Go” trend as price broke above a downward sloping trend line with GoNoGo Oscillator able to break above the zero line providing momentum support for the price move. We also see that on strong blue “Go” bars, price has eclipsed the high from November. GoNoGo Oscillator is in overbought territory so we will pay attention to its next move. Should it fall we will see a Go Countertrend Correction Icon (red arrow) which could indicate a pause in price as it looks to consolidate at these higher levels before potentially moving higher.
