There is an old saying that when you are making new highs you are not in a down market. Sometimes the bad news can really sound overwhelming. The stock market can be a leading indicator and may be starting to price in a pick up in the second half of 2013.
Well the slogan above sounds obvious but our Canadian Energy Sector has been in a funk so long that the $TSX has been held down. Gold has not helped either. However, there are sectors performing well. The Industrials are an early cycle sector along with the Transports. When they get going, its very bullish.
Well, the Canadian Industrials are making new highs. 4 year highs.
I showed a breakout on the down sloping trendline in the US Transports last week. While not a horizontal breakout to 1 year highs, $TRAN sits today at 7 month highs.
Here is the US Industrials Chart breaking out to 5 year highs.
When things are hitting new highs, its bullish. Lets keep our eyes on the charts, not on the news. In a few ticks higher, this chart will be testing all time highs.
Good Trading,
Greg Schnell, CMT.
