Most of what you’ll hear me talk about are things I’ve learned from other people. In some cases, they were predecessors of mine and in other cases they’re buddies and colleagues. It’s funny because I try to do a good job of giving credit when I can, where I remember specifically who I learned something from. You guys who have been following me for a long time know that about me. But the truth is that sometimes I simply forget where I learned it. It’s just part of my arsenal and I always assumed it was there.

The best part about this is that sometimes, when I’m lucky, I come to realize down the road where I learned certain things. For example, I was in Chicago last year or maybe the year before that, I forget, and had lunch with Jim Bianco. Of course we can’t help ourselves but talk markets so we dive into a heavy bond market conversation (I know you must be shocked if you know Jim that he’s arguing about rates lol). Anyway, he proceeds to rip through 20-30 charts in what felt like a matter of seconds. It hit me! THAT is why I rip through so many charts when I give my presentations. I got that from watching him give a talk at Bloomberg over a decade ago!

Another time, John Roque was nice enough to invite me to lunch. He’s a member of the New York Athletic Club but I got booted out for wearing jeans (Amateur move on my part). But we went around the corner to this great Greek joint, so it was all good. Plus then I got to drink my favorite Assyrtiko from Santorini that I love so much with a branzino. The volcanic soil really brings out that acidity, but I digress. John is a big sports nut. So he makes so many references to sports in his analysis that it hit me. That’s why I do that! I was so excited. Because I’ve stolen a ton of stuff from John over so many years – he’s one of the best in the business. I got, “We’re not in a reversion to the mean business, we’re in a reversion beyond the mean business” from him. I learned from him to analyze the market caps of sectors as a % of total market cap. He was one of the early influences on me to use gold as a denominator when I was in my early 20s. I’m probably missing a bunch, but he’s been a tremendous inspiration to me.

The reason I’m telling you all these stories is because sometimes, I truly truly remember where I learned certain lessons, including what we’re going to talk about today: “The Bigger the Drop, The Longer The Need For Repair”. This is one of the many great lessons I’ve learned from my friend Louise Yamada. She is one I’m glad I listened to when I was much younger! When I emailed her about this quote wondering if she got this from the great Alan Shaw, she said yes, that she learned it from him and Ralph (Acampora).

When I look at this chart of Carnival Cruise Lines, I can’t help but think about this quote. It’s almost like it was written for this stock: [Read more…]

The joke around our virtual office this morning was that the nasdaq is not just strong as an index, the stock itself really stands out!

The exchanges and “marketplaces” are really shining. The relative strength compared to many other sectors and industry groups is off the charts (see what I did there?)

Take a look at names like CME Group, Market Access and Tradeweb. These names keep popping up on our relative strength scans, especially compared to other types of “financials”. But let’s be serious, these are tech stocks.

This is the chart of the Nasdaq that has our attention: [Read more…]

Did you notice how shares of Advanced Micro Devices are trying to finally break out of this 20-year base?

This is a long-term candlestick chart I brought up on our Monthly Conference Call last night.  I used a line chart just to show how clean it is.

The “Multi-decade breakout” thesis is only valid if we’re above those 2000 highs. If not, then by definition, it’s not a breakout.

That level for me is $44: [Read more…]