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It's Still A Very Bullish Market Setup

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I am not sure if everyone is watching how stellar the performance of the two particularly strong sectors in September has been.

A look at the one-month performance shows a clear lean on Financials and Energy. Everyone keeps pointing to oil's volatility but the energy stocks have some of the strongest SCTR's.

 


For a bull market, we want to see the stocks on the left side of this panel outperform. If we add a cycle line to the chart, it fits almost perfectly over the last month. This is a very nice bullish setup.

The Bullish Percent Index (BPI's) are very strong. This is not an overbought condition. This is a very strong, broad, bullish setup. Usually, the Bullish Percents have to start making lower lows below 50 and then a lower high before the market struggles to make higher highs. Currently, the $BPNYA is still very strong. With the Percentage Of Stocks Above The 200 DMA ($NYA200R) in the lower panel showing a lot of strength, this is not the place where we usually collapse from.

The energy stocks are dominating the SCTR lists and the Bank, Broker and Insurance stocks are moving into the top leadership area of the SCTR's. This looks like a nice setup for the 4th quarter at this point in time. That doesn't mean we won't get 3-5% pullbacks, but they should be bought as this looks like a strong setup for equities in the 4th Quarter.


This month, Chartcon 2016 is coming to you via live stream broadcast. Rather than have customers spend all the money to travel to the event, we have arranged for all the technicians to gather in one location and broadcast from there, saving you thousands of dollars. It should be a crazy couple of days with a tight synopsis of the markets from an award winning Technical Analyst crew. You can register for this event for under $200 and have access to the recordings. Chartcon 2016.


Next, I will be presenting in person at Golden Gate University in September if you are in the area.

September 20th, 2016 @ 4 PM
Golden Gate University. Rm 3214
536 Mission Street
San Francisco, 94104
Cost: Registration is $10 for MTA members and $20 for non-members

You can register through the TSAA-SF website. Click here.

Feel free to pass this article on to friends and family. If you would like to receive future articles by email, click on the Yes button below each blog. I do roughly one-two articles a week from each blog (Commodities CountdownThe Canadian TechnicianDon't Ignore This Chart) so you need to subscribe to each one individually. I also do a couple of webinars each week and you can view those live or in our webinar archives. As a heads up, I'm on twitter @Schnellinvestor.

Thanks for taking the time to join me.

Good trading,
Greg Schnell, CMT, MFTA.

 

Announcement from the Author

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Greg Schnell
About the author: , CMT, is a Senior Technical Analyst at StockCharts.com specializing in intermarket and commodities analysis. Based in Calgary, he is a board member of the Canadian Society of Technical Analysts (CSTA) and the chairman of the CSTA Calgary chapter. He is an active member of both the Market Technicians Association (MTA) and the International Federation of Technical Analysts (IFTA).

Greg is also the co-author of Stock Charts for Dummies (Wiley, 2018). Greg joined StockCharts.com in 2012 and has be instrumental in helping launch a variety of new blogs and other commentary platforms. Presently, Greg contributes market analysis commentary to The Canadian Technician, Commodities Countdown and Don't Ignore This Chart blogs. Learn More
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