Good morning and welcome to this week’s Flight Path. The equity trend saw a new trend this week as a week of amber “Go Fish” bars gave way to “Go” bars. We will watch closely to see if this trend can hold. Treasury bond prices remained in a strong “NoGo” trend for another week. U.S. commodities saw the pink “NoGo” bars give way to an uncertain “Go Fish” bar as the week came to a close. The dollar hung on to its “NoGo” trend for another week but we did see weakness with pink bars.
$SPY Enters New “Go” Trend on Daily Chart
The GoNoGo chart below shows that after a full week of amber “Go Fish” bars of uncertainty the market seems to have made up its mind for the time being. A pair of strong blue “Go” bars have appeared. We will watch to see if this trend can hold. We will need to see price consolidate at these levels and use it as support going forward. GoNoGo Oscillator is in positive territory but not overbought at a value of 3. If the oscillator can remain at or above zero that would be a good sign for the new trend.
The weekly chart shows us that we still have some way to go. We see a pink “NoGo” bar after an amber “Go Fish” bar last week. As we mentioned above, price will have to build on this and find a way to consolidate these past weeks’ gains. GoNoGo Oscillator is testing the zero line and volume is heavy. If the oscillator is able to regain positive territory that would be a very good sign. If it is turned away here and falls back into negative territory then we may see price remain in a “NoGo”.
Treasury Rates Back in “Go” Trend
GoNoGo Trend shows that it remains a choppy time for rates. After several amber “Go Fish” bars we see GoNoGo Trend trying to paint fresh aqua “Go” bars. This trend is weak however, and we see that we are some way from a new higher high, or a new lower low. With price moving mostly sideways, we still see GoNoGo Oscillator struggling with the zero line. After briefly breaking out of a GoNoGo Squeeze into negative territory it is right back at zero and we see another Squeeze building. With the change in trend in the price panel, it will be important to see the oscillator confirm by regaining positive territory.
Dollar Shows Continued Weakness
The “NoGo” trend continued for another week but we see more weak pink bars as price climbs further from the lows. A small series of higher highs and higher lows is in place as we approach possible resistance from April’s prior low. GoNoGo Oscillator is now in positive territory having found support at that level already once. With momentum out of step with the trend, we will watch to see if there any change in the panel above this week.
“NoGo” Remains but GoNoGo Trend Introduces Weakness
GoNoGo Trend shows that price rallied off prior low support this week. Having failed to set a lower low, we see price climbing on weaker pink bars. GoNoGo Oscillator is testing the zero line from below but volume is weak. We will watch to see if the oscillator is turned away from here. If it is, then we might expect price to roll over and once again test prior lows. If the oscillator is able to break into positive territory then oil prices may be able to climb further.
Gold Consolidates at Highs
Gold stays in the “Go” trend for another week. We saw strong blue bars earlier in the week as price rallied and came close to prior highs before falling and GoNoGo Trend painted weaker aqua bars. This is the first failed attempt at a higher high that we have seen for a while. With very little momentum on the last surge and the oscillator once again testing the zero line from above it will be very important to see whether the oscillator can stay at or above zero this week.
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. 4 sectors are in relative “Go” trends. $XLK, $XLF, $XLI, and $XLU are painting relative “Go” bars.
Utilities Sub-Group RelMap
The chart below shows a relative trend breakdown of the sub groups within the utilities sector this week. The Sub-Group RelMap plots the GoNoGo Trend of each sub index to the $XLU. We saw in the above GoNoGo Sector RelMap that $XLU is a long time out-performer of the base index. When we look at the below RelMap we can see that in the last panel, the gas distribution index has been out-performing for some time and is currently painting strong blue bars.
$UGI Breaks Above Resistance in “Go” Trend
GoNoGo Trend shows that after a sideways period that even allowed the indicator to paint some “NoGo” bars, a strong “Go” trend has returned. We look at the lower panel and see that while there was chop in the price panel above, GoNoGo oscillator forcefully broke out of a Max GoNoGo Squeeze into positive territory weeks ago. Momentum continued to rise as price found its feet in the “Go” trend. Now, with price above the horizontal resistance we see on the chart, we will look for support to be found at this level should momentum cool in the coming days.
$NFG Looks For Support at Prior Resistance
The chart below of $MSTR shows that price has burst higher on strong blue “Go” bars. This move has pushed price clear of resistance in the form of prior highs. We now watch the concept of polarity playing out as price tries to hold above a level that was once resistance and use it as support. GoNoGo Oscillator is in positive territory but no long overbought having broken out of a GoNoGo Squeeze. We will watch to see if the oscillator can provide the support price needs to use this as a springboard for higher highs.
