JC, Author at All Star Charts Page

Chart Of The Week: Don’t Fight Papa Dow

June 5, 2019 by JC

Life can be simple or you can make things complicated and noisy. It’s up to you.

What business are you in? The business of trying to make money in the market or the business of making and/or consuming noise?

I was out in Greece on my honeymoon for a couple of weeks last month, but I was keeping an eye on what was going on. I love the market and I enjoy observing human behavior. So why should I completely shut myself off from something I like doing?

Now that I am married, I would very much like to keep my wife happy, and I also think it’s important to get away (see here). So appropriately I shut things off and enjoyed my time in, what are now officially, my favorite islands in the world. It was funny because some of the locals in the Cyclades Islands were telling me how much they wanted to go to the Caribbean. I was like, “Naw man, stay here. Trust me!”

What I noticed from far far away is how noisy the market place can be if you let it. My friend Josh wrote an excellent piece this week about how he takes control of the type of media content he consumes. I thought it was really well written and I agree with almost all of what he had to say. Check out: Why I Don’t Wake Up To The News. From beautiful Mykonos and Naxos and Santorini, I was checking in on the markets, because that’s what I do, phoning into our desks to see what they were seeing and observing commentary on the twitter, from both intelligent market participants and noisy members of the media. The drama I witnessed was fascinating, especially looking at it from the outside.

Not just in times like this, but really every time, I think it’s important to take a step back and really see what is ACTUALLY happening in the market. I think the best picture of what is truly taking place is the behavior of the Dow Jones Industrial Average. The way I learned it was, “Don’t fight Papa Dow”. The market doesn’t always have to be trending up, or trending down. It doesn’t always have to be a top or a bottom. Most of the time, it’s just in the middle. And sometimes, like it has been since early 2018, the trend is actually sideways. And what’s wrong with that?

Here is the chart of the Dow using my new favorite data platform Koyfin: [Read more…]

They’re Just Selling Us F*%#ing Buicks

June 4, 2019 by JC

If you still think the media is there to provide you with useful information, there is little I can do to help you. It’s 2019. They’re only there to sell you Buicks and razors and whatever else they can shove down your throat.

The content they provide is designed to get you to consume it for the sole purpose of selling your attention to their sponsors. That’s just the business.

You have two choices: You can just take it until your punch drunk or you can take what you consume into your own hands. It’s up to you.

Phil and I sat down for an interesting chat about this very topic: [Read more…]

The Power Of Getting Away

June 3, 2019 by JC

I know some people who haven’t taken a vacation in years. The excuses come in all shapes and sizes. For me, I think that does much more harm than good. I know this for a fact because I used to be one of those people. I used to think that I didn’t deserve a break. “I’m not there yet”, is what I’d say. I skipped vacations with my family and encouraged them to go without me. I’ve regretted those decisions ever since.

Over the past 5 years I’ve made it a point to get away regularly. I’ve written about it the benefits before and I feel more strongly about this than ever. Even if you take a week off where you just stick your computer in the closet and make it more of a staycation, that works too. It’s important to be self-aware. I know myself enough that I do not have the discipline to stay away from my computer if I’m home. I like my work. I know I’ll jump on and check out some charts. I can’t help myself. So I need to go away completely to accomplish my goal of ‘getting away’.

Usually I’ll get out for 5-7 days at the most about twice a year. Once in the summer and once during ski season. It helps clear my mind and come back refreshed. Those of you who have known me for a long time know that I don’t care if stocks double or get cut in half. Gold can go to zero tomorrow and it won’t matter to me. I’m not a permabull or permabear in any asset. Those are fools. I’m convinced that regularly getting away and starting from scratch when I return helps me keep an open mind. The best example I can think of is when I went to Mexico 3 years ago (June 2016) thinking U.S. stocks were about to roll over and then came back a week later buying every stock on earth. It was a quite the change of heart that I can only credit my vacation and getting away to come back with an open mind. Stocks all over the world ripped from there and never looked back! [Read more…]

What My Puppy Taught Me About Life

May 16, 2019 by JC

Phil Pearlman has always been a good guy to talk to about a lot of different things. I know for a fact that a lot of your favorite fintwit personalities would agree with that.

Phil doesn’t do a lot of media anymore like he once did, but I do get to catch up with him quite often and we publish our conversations as The Money Game Podcast. You can check out all of those episodes on Technical Analysis Radio and iTunes.

Today we’re talking about what little Daisy Pearlman the puppy taught Phil about life: [Read more…]

Video: Today’s Overhead Supply In Stocks

May 15, 2019 by JC

We hear this term a lot: “Overhead Supply”. But what does that mean exactly?

Well, I’ll tell you what it means to me. When I look at today’s stock market, I see stocks rallying throughout 2017 and running into resistance, or more selling than buying, in January of 2018. After some distribution, stocks rallied once again late into the 3rd quarter last year, only fail and sell off. That was a beautiful sell-off in stocks that many of us enjoyed very much.

Fast forward to 2019 and we’ve had a killer rally in stocks that has brought us back to where this overhead supply party first got started early last year. This is now the 3rd attempt and failure for stocks. And when I say stocks, I don’t just mean the S&P500 or Dow Jones Industrial Average, I’m referring to stocks as an asset class.

In this video, I try and explain what I mean by pointing out the behavior of the Global 100 Index, Dow Jones Industrial Average, Dow Jones Composite Average, Dow Jones Internet Index and the IPO Index. They’re all telling a similar story of “Overhead Supply”. In the future, when I give educational seminars or speak at Universities, I will bring up these charts as excellent examples of the overhead supply dynamics we see quite often in the market, just rarely this clear.

Here is the video in full: [Read more…]

All Star Interviews Season 2, Episode 23: David Zarling, Chartered Market Technician

May 15, 2019 by JC

David Zarling is a newly minted CMT Charterholder. He is Partner and Head of Investment Strategy & Research at Client First Tax and Wealth Advisors out of Wisconsin. David and I have gotten to know each other over the years and I really appreciate all of the things he is doing. In this podcast episode, David walks us through his process and how it has evolved throughout his career. He uses Technical Analysis to help manage money for clients and most importantly manage risk. I’ve seen a lot of him lately. He attended Chart Summit in Breckenridge, CO in February and then the CMT Symposium in New York in April. He talks about why he goes out of his way to get around like minded individuals to talk about the markets and find people to challenge his thinking. I also really liked the part about the analogies he uses when talking to clients about Technical Analysis and his process. I thought this discussion was a real value add. [Read more…]

This Chart Tells The Story Best

May 14, 2019 by JC

People love to hear a good story. We have an evolutionary desire to gossip and be told stories even if we know they’re untrue. As Sapiens, it’s important to know this about ourselves. But you know who definitely knows it? The media. And they’re going to use that desire against you every single day for their own profit. They will tell you stories all day every day as long as you’re willing to listen. They’re so thirsty for your attention that they’ll tell you anything just so they can sell ads to their precious sponsors. It’s their job to make the noise. It’s our job to ignore it.

Today, I’m going to show you the chart that actually tells the real story about what is going on in today’s market. I comb through thousands of charts a week and I can tell you for a fact that there is one underlying theme that I’m seeing across the board: Stocks, Sectors and Indexes, and that is the Overhead supply we’ve been stuck below since early last year. [Read more…]