Good morning and welcome to this week’s Flight Path. The equity trend remains firmly in place as we see strong blue bars after a lone weaker aqua bar. Treasury bond prices remain in a “Go” trend but we do see consecutive weaker aqua bars late in the week. U.S. commodities paint weak aqua bars as well but remain in a “Go” trend. The dollar displayed more chop last week as we saw another amber “Go Fish” bar but the last day of the week was painted the pink of a weak “NoGo”.
$SPY “Go” Trend Moves Ever Higher
The GoNoGo chart below shows that the “Go” trend showed renewed strength after a single weaker aqua bar. The moment of weakness came after a Go Countertrend Correction Icon (red arrow). After falling out of overbought territory we saw the GoNoGo Oscillator reverse course and return to overbought levels on strong momentum and heavy volume. We will look to see if the oscillator falls out of overbought extremes again in the coming days.
The weekly chart shows that the strong “Go” trend stays in place on the longer time frame. As the trend progresses we see that GoNoGo Oscillator has now entered overbought territory at a value of 5. We will watch to see if this leads to an exhaustion of momentum and a possible stall in price this week.
Treasury Rates Rally but Remain In “NoGo”
GoNoGo Trend shows that the “NoGo” trend remains in place but we see price rising from the recent lows and GoNoGo Trend painting weaker pink bars. This comes after a couple of NoGo Countertrend Correction Icons (green arrows) indicated that rates may struggle to go lower in the short term. GoNoGo Oscillator is testing the zero line from below where we will watch to see if it finds resistance.
Dollar in Weak “NoGo” Trend
The trend in the dollar is a “NoGo” but we see that a new pink bar represents weakness after an amber “Go Fish” bar of uncertainty. The dollar has struggled to move significantly in either direction of late and so we will pay attention to the lower panel where we see that the GoNoGo Oscillator is testing the zero line from below and volume is heavy.
Oil “NoGo” Trend Remains in Place as Price Falls
GoNoGo Trend shows that the “NoGo” is hanging on to pink bars as price falls after a couple of amber “Go Fish” bars of uncertainty. As price falls to test prior lows, we see that GoNoGo Oscillator is back in negative territory after failing to find support at the zero line and this triggers a NoGo Trend Continuation Icon (red circle) above the price bar. We will watch to see if price will fall to new lows this week.
Gold Continues to Soar
The weekly chart of Gold shows that price climbed yet higher this week and GoNoGo Trend paints another strong blue bar. We look to the GoNoGo Oscillator in the lower panel and note that it is at an extreme overbought level of 6. We will watch to see if it can stay elevated on market enthusiasm or if the oscillator falls. If it shows signs of momentum exhaustion we will see a Go Countertrend Icon (red arrow) on the chart and will expect price to struggle to go higher in the short term.
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. 3 sectors are in relative “Go” trends. $XLK, $XLY, and $XLC, are painting relative “Go” bars.
Technology Sub-Group RelMap
The chart below shows a relative trend breakdown of the sub groups within the technology sector again this week. The Sub-Group RelMap plots the GoNoGo Trend of each sub index to the $XLK. We saw in the above GoNoGo Sector RelMap that $XLK is a new out-performer of the base index painting relative strong blue “Go” bars. When we look at the below RelMap we can see that the computer hardware index in the 4th panel is a strong out-performer on a relative basis painting bright blue bars.
$ROKU Looks to Consolidate New Highs
GoNoGo Trend shows the “Go” trend has been in place since a short lived “NoGo” correction a month ago. After GoNoGo Oscillator broke out of a GoNoGo Squeeze into positive territory we saw a Go Trend Continuation Icon (green circle) that helped suggest momentum was resurgent in the direction of the “Go” trend and indeed a string of bright blue bars saw price break to a new higher high. We will watch to see if price can consolidate at these higher levels in the coming days.
$DELL Ready for Trend Change?
The chart below shows that $DELL fell out of a “Go” trend at the end of August as price gapped lower. Since then, it has been trying to recover and we see GoNoGo Trend has painted a string of amber “Go Fish” bars. The “Go Fish” bars often appear at moments of transition and we will watch to see if a new “Go” trend can emerge this week. GoNoGo Oscillator is back in positive territory after having broken out of a GoNoGo Squeeze and so we will look to see if this positive momentum will help push price into a new “Go” trend.
