Buy Signals Triggering In China

“The most effective and functional trading belief that he can acquire is “anything can happen.” Aside from the fact that it is the truth, it will act as a solid foundation for building every other belief and attitude that he needs to be a successful trader.” ~ Mark Douglas

Good morning!

In this week’s Dirty Dozen [CHART PACK] we look at Europe with a 21-year breakout, airlines in a bull trend, buy signals in tech, consolidated positioning nearing a zenith, soybeans at an inflection, the peso (MXN) going into elections, and monthly stock charts with great setups, plus more…

Let’s dive in.

***click charts to enlarge***

  1. Ari Wald, a seasoned technical analyst at Oppenheimer, shared some great charts on Bloomberg this past week. Here’s the SPX on top and RTY below. Both are coiled tight and ready for a run higher.

  1. Europe’s stock market just broke out of a 21-year sideways consolidation.

  1. This final one from Ari shows Airline stocks stair-stepping higher. We’ll see how long this trend will last if oil breaks out higher (which I expect it will).

  1. @MacroCharts tweeted about the recent underlying strength in growth stocks, writing “Important strength in Growth Stocks: One-third of Nasdaq Stocks have triggered Buy signals – the most since March 2020. Most spikes of this magnitude led to bottoms or *big* rally extensions. A textbook Bull Market response after a sentiment capitulation – follow the Trend.”

  1. I’m bullish over the very short-term but believe we’re nearer the end than the middle of this leg of the bull rally. One more leg up should be enough to get players over their skis…

  1. USDJPY is trading in one of its tightest two-month ranges in 50-years. Compression regimes lead to expansionary ones (big trends).

  1. A few weeks ago we talked about the near-record high aggregate speculative positioning in Ags. A number of these charts are starting to pull back from extended levels. Soybeans recently crossed above 2.5 on its weekly SQN. There have been 5 instances over the prior 60+ years and 4 of them led to lower prices a few months later.
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Disclaimer: All statements are solely opinions and are for educational purposes only.

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