RRG Charts

December 2018

RRG Charts

If the SPY:IEF ratio is going to test its support at the 2015 peaks where do SPY and IEF prices need to go?

by Julius de Kempenaer

The above chart shows the stocks/bonds ratio using monthly bars since 2004. IMHO this is one of the most useful charts to decide on an important portion of the asset allocation in your portfolio. Should you invest in stocks or in bonds. In other words, "Risk ON" or "Risk OFF". It is a basic relative strength chart but now using bars instead of a line chart. this is to show that during a month the relative strength (ratio) can move wildly. A bar chart will give a better, more detailed, view of how, trends in, RS moved when using long-term (monthly) charts like this. A Read More 

RRG Charts

Relative Rotation Graph Shows BOB (EXC & WELL) vs WOW (NBL & FTV) Stocks

by Julius de Kempenaer

In my previous post, I highlighted both the Real-Estate and the Utilities sectors as (strong) outperformers during this weak period for stocks in general. This "Double + for Utilities and Real Estate on Relative Rotation Graph" pointed to the position inside the leading quadrant for both sectors on both the weekly AND the daily time frames. Frequent readers of this blog or people who have heard me speak at some event probably already know that I think that most investors are too focussed on "what to buy" as opposed to being aware of "what NOT to buy". Read More 

RRG Charts

Double + For Utilities And Real Estate On Relative Rotation Graph

by Julius de Kempenaer

The market keeps throwing us curve balls on a daily basis. The Relative Rotation Graph above translates these curve balls into (sector-) rotational patterns. The weekly chart above shows continuing strength for Utilities and Real Estate as they continue to move higher on both axes of the RRG. Staples and Healthcare are still comfortable inside the boundaries of the leading quadrant but lost a bit of their relative momentum which causes them to move more or less flat for now. There is nothing wrong with flat and higher on the JdK RS-Ratio scale! It means that the Read More 

RRG Charts

RRG Says Stocks Are The Weakest Asset Class

by Julius de Kempenaer

The Relative Rotation Graphs shows the rotation of various asset classes around a balance benchmark portfolio (VBINX). The message could not be more clear. Stocks (SPY) just crossed over from weakening into the lagging quadrant while ALL other asset classes are inside the leading quadrant. This is a pretty clear message that is hard to ignore. Summary Stocks rotate into lagging quadrant while all other asset classes are in leading Four red flags for SPY Read More