Good morning and welcome to this week’s Flight Path. The equity trend continued this week and we see that the week ended with a few strong blue “Go” bars as the trend regained its strength. Treasury bond prices saw the uncertainty of the week before give way to a “NoGo” trend with a few strong purple bars at the end of the week. U.S. commodity prices held on to the “Go” trend with strong blue bars. The dollar, for the first time in several weeks showed some uncertainty as the trend indicator painted a few amber “Go Fish” bars, sprinkled in with the “NoGo” colors.
$SPY Threatens to Move Even Higher
The GoNoGo chart below shows that the “Go” trend continued this week and after one weaker aqua bar we saw strength return with bright blue “Go” bars as price tries to make another higher high. We turn our attention to the GoNoGo Oscillator and we see that it is in positive territory but no longer overbought at a value of 3. We will watch to see if the zero line provides support should momentum fall that far.
The weekly chart shows that on the larger timeframe the trend looks to be safe for the time being. We saw another strong blue “Go” bar marking the 4th in a row as price remains at higher highs. GoNoGo Oscillator is rising at a value of 4 and volume is heavy. We will watch as the indicator reaches overbought territory and look out for signs of Go Trend Correction.
Treasury Rates Paint Weak Aqua “Go” Bars
After a week of uncertainty where GoNoGo Trend painted amber “Go Fish” bars, we saw new “Go” bars late in the week. The indicator was able to paint weak aqua bras as rates try to move higher in the sideways range they has been in for several months. After failing to set a new low late June, we will watch to see if there is enough strength to carry it to new highs. GoNoGo Oscillator is in positive territory so for the time would confirm a move up.
Dollar Flashes Uncertainty
The trend in the dollar faltered this week as we see GoNoGo Trend paint a few amber “Go Fish” bars representing uncertainty in the midst of this “NoGo” trend. We will watch closely here as we see price struggling to set a new high. If the “NoGo” trend returns, we will turn our attention to the oscillator panel to see if support is found at zero.
Oil “Go” Trend Survives but Remains Weak
GoNoGo Trend shows price has moved mostly sideways this past week and the indicator has painted nothing but weaker aqua bars. When we look at the GoNoGo Oscillator panel we see that it has been stuck in a battle at the zero line as it reflects the tug of war between buyers and sellers at this level. We see an extended Max GoNoGo Squeeze and it will be important to note the direction of the break out of this Squeeze.
No Gold Rush This Week
Once again we saw price move mostly sideways as GoNoGo Trend struggled to make a determined move in either direction. Yet again we saw weaker aqua “Go” bars return, this time after a lone amber “Go Fish” bar of uncertainty. In the oscillator panel below we see that GoNoGo Oscillator has been stuck at zero and this has caused the build up of a Max GoNoGo Squeeze. If we can break out of the Squeeze into positive territory then we can expect price to make an attempt at moving higher.
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. $XLK, and $XLI, 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 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 continues to be the consistent out-performer as it paints strong blue “Go” bars. When we look at the below RelMap we can see that the semi-conductors index in the third panel remains strong as it paints relative blue “Go” bars.
$LASR Looks for New Highs
GoNoGo Trend shows that there has been a “Go” trend in place now since early May. After a runaway gap, we saw price race higher on strong blue bars to a high in late June. After that high, we saw a Go Countertrend Correction Icon (red arrow) telling us that price may struggle to go higher in the short term. Indeed, we have seen price fail to climb since then. GoNoGo Oscillator has been at or above the zero line for the entirety of the “Go” trend, and now we see it has found support again, breaking out of a Max GoNoGo Squeeze into positive territory. This has triggered a Go Trend Continuation Icon (green circle) to appear on the price chart as momentum is resurgent in the direction of the trend. We will look to see if this gives price the boost it needs to set a new higher high.
$STM Looks to Continue Run to New High
$STM has been in a “Go” trend since early May. Since then we have seen price step through a series of higher highs and higher lows and each time GoNoGo Oscillator has found support at the zero line after any trend correction. It is the same story recently. At the last high, we saw a triplet of Go Countertrend Correction Icons (red arrows) suggesting that price may struggle in the short term due to waning momentum. GoNoGo Trend painted a few weaker aqua bars as price fell from the high but we have seen GoNoGo Oscillator quickly find support at the zero line. This Go Trend Continuation (green circle) tells us that momentum is once again on the side of the “Go” trend and we will watch to see if this week brings another high.
