Good morning and welcome to this week’s Flight Path. The equity trend remained in place again this week and strength returned in the form of bright blue bars at the end of the week. Treasury bond prices painted strong blue bars after a lone pink bar threatened to change the trend. U.S. commodity prices also remained in a “Go” trend albeit painting weaker aqua bars as the week came to a close. The dollar shows some uncertainty on the last bar of the week as GoNoGo Trend paints an amber “Go Fish” bar.
$SPY Paints Strong “Go” Bars
The GoNoGo chart below shows that the “Go” trend remained in place and we saw renewed strength as price tried to set a new higher high. Although unable to close higher, the major market index remains at elevated levels and the trend is strong. GoNoGo Oscillator has bounced off the zero line once again demonstrating resurgent momentum in the direction of the underlying “Go” trend.
The weekly chart shows that the strong “Go” trend was able to stick around for another week as price continues to climb and the indicator paints another bright blue bar. If we look to the lower panel we see that GoNoGo Oscillator remains in positive territory but still not yet oversold as the indicator remains at a value of 4.
Treasury Rates Hit New Lows
GoNoGo Trend shows that the “NoGo” trend continued this week with mostly strong purple bars as rates plummeted to a new intermediate low after gapping lower mid week. This came after GoNoGo oscillator broke out of a Max GoNoGo Squeeze into negative territory. With the oscillator now oversold, we will watch to see if rates halt their fall.
Dollar Paints Amber “Go Fish” Bar
The trend in the dollar faltered this past week as it fell out of the “Go” trend and painted uncertain amber “Go Fish” bars. This comes after the “Go” trend was unable to get “Go”-ing at all having failed to make a new higher high for several weeks and moving mostly sideways. GoNoGo Oscillator is breaking back below the zero line as momentum falls as well.
Oil “NoGo” Trend Paints Strong Purple Bars
GoNoGo Trend shows that the “NoGo” remains in place after hinting at trend change early in the week with an amber “Go Fish” bar. Price quickly fell following that as the market made up its mind and we saw strong purple bars for the rest of the week. GoNoGo Oscillator has fallen below zero and is now testing that level from below where we will watch to see if it gets rejected.
Gold Breaks Above Resistance
The weekly chart of Gold shows that the “Go” trend has really taken the precious metal to new heights. Having struggled for months with overhead resistance we saw it burst to new highs on strong blue “Go” bars. We will watch to see if price can consolidate at these elevated levels and continue to climb going forward. GoNoGo Oscillator has rallied off the zero line and raced into overbought territory and now is at a value of 6.
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. 2 sectors are in relative “Go” trends. $XLY, and $XLC are painting relative “Go” bars.
Communications Sub-Group RelMap
The chart below shows a relative trend breakdown of the sub groups within the communications sector again this week. The Sub-Group RelMap plots the GoNoGo Trend of each sub index to the $XLC. We saw in the above GoNoGo Sector RelMap that $XLC is a relatively new out-performer of the base index painting strong blue “Go” bars. When we look at the below RelMap we can see that the internet index in the top panel is a strong outperformer on a relative basis painting bright blue bars.
$NBIS Looks For Support in “Go”
GoNoGo Trend shows that $NBIS has been in a “Go” trend for several months and is looking for support at the upper bound of a gap from last month. Having gapped to new highs we saw price move mostly sideways and GoNoGo Oscillator get stuck in an extended Max GoNoGo Squeeze. Now, as price paints aqua bars and continues to use the top of the gap as support, we see that GoNoGo Oscillator has dipped its nose into negative territory. The oscillator will need to get back above the zero line in order to provide momentum support for price.
$RDDT Looks to Set new Higher High
The chart below shows that $RDDT has been in a “Go” trend that has made higher highs and higher lows for a few months. Each time price has fallen from a new high, GoNoGo Oscillator has found support at zero. We see the same situation playing out now. After the most recent high, we saw a Go Countertrend Correction Icon (red arrow) indicating price would struggle to go higher in the short term. Indeed, price painted consecutive weaker aqua bars and GoNoGo Oscillator again tested zero. Now, the oscillator is breaking out of a Max GoNoGo Squeeze as price rallies on strong blue bars and looks set to challenge for a new higher high.
