Intraday Market Thoughts

Scary Mystery Chart

by Ashraf Laidi
Apr 19, 2017 12:54

Care to guess this chart? It's the monthly chart of a popular US sector index. As you can see, it failed to break its 7-year channel right at the same level of the 76.4% retracement of the decline from the 2007 high to the 2009 low. The relative strength index may also indicate further declines towards the mid-point of the channel's height, a break of which may drag it to pre-November levels. i.e. erasing the all of the gains from the Trump's victory rally.  Again, this is not FX, commodity, bonds or a ratio. Just a straightforward index. It's a big deal when you find out what is.

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Scary Mystery Chart - Mystery Chart Apr 19 2017 (Chart 1)

 
 

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