{"id":164559,"date":"2020-02-06T13:50:12","date_gmt":"2020-02-06T18:50:12","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=164559"},"modified":"2020-02-06T13:35:35","modified_gmt":"2020-02-06T18:35:35","slug":"broad-market-sector-rotation-starts-in-60-days-part-i","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2020\/02\/broad-market-sector-rotation-starts-in-60-days-part-i\/","title":{"rendered":"Broad Market Sector Rotation Starts In 60+ Days \u2013 Part I"},"content":{"rendered":"
February 6, 2020<\/div>
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By TheTechnicalTraders<\/u><\/a><\/strong> – We have been writing about the strong potential for a deeper market rotation in the US and global markets for well over 60+ days.\u00a0 In fact, our researchers predicted an August 2019 breakdown date based on Super-Cycle patterns that, eventually, pushed into 2020 as the US\/China trade negotiations and other global news kept global markets in a low volatility bullish trend throughout the end of 2019.<\/p>\n

We\u2019ve highlighted some of our research posts over the past 30+ days to help illustrate the technical and price patterns that our research team has identified and shared.<\/p>\n

December 20, 2019: <\/strong>WHO SAID TRADERS AND INVESTOR ARE EMOTIONAL RIGHT NOW?<\/strong><\/a><\/p>\n

December 16, 2019: <\/strong>CURRENT EQUITIES RALLY SIMILARITIES TO 1999<\/strong><\/a><\/p>\n

December 2, 2019: <\/strong>NEW PREDICTED TRENDS FOR SPX, GOLD, OIL NAT GAS<\/strong><\/a><\/p>\n

Technical Analysis is based on the premise that price reflects all news and expectations the instant that news or data is known.\u00a0 A common term in Technical Analysis is \u201cBias\u201d.\u00a0 This is when the price trend is substantially more Bullish or Bearish by nature or expectation.\u00a0 Bias occurs when investing conditions mostly eliminate risk (for the Bullish side) and opportunity (for the Bearish side).\u00a0 When traders feel they can enter trades without any real risks (trading Long) or when they feel there is no opportunity for the markets to rally (trading Short), then a BIAS exists in the markets.<\/p>

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When the global markets rotate and volatility extends to much higher levels, the markets change from a \u201cBiased Trend\u201d to what Technical Analysts call \u201cTrue Price Exploration\u201d.\u00a0 When this happens, price begins to operate under the price principles of Gann, Fibonacci and Elliot Wave theories where price attempts to rotate to new lows or highs in an attempt to \u201cseek out\u201d clear support and resistance levels before establishing a new longer-term \u201cBiased trend\u201d.<\/p>\n

We believe the global markets are about to enter a very volatile period of sector rotation.\u00a0 Certain sectors may see a much deeper price exploration than others.\u00a0 For example, consumer product manufacturers focused on US and European markets may see very limited risks compared to the Industrial Supply sector where a global economic slowdown could really hurt their future expectations.<\/p>\n

These two Market Sector Maps (source www.Finviz.com<\/a>) highlight the change in the direction and scope of these changes over the past week and the past 30 days.<\/p>\n

This first Sector Map is a 1 Week Sector Map<\/h3>\n
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This second Sector Map is a 1 Month Sector Map<\/h3>\n
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Pay very close attention to the sectors that were moderately or strongly weak in the 1-month chart and continue to weaken in the 1-week chart (Financial, Property, Telecommunications, Telecom Services, Healthcare, Biotech, Basic Materials, Industrial Goods, Lodging, Resorts, Travel, Hospitality, Food, Packaging, Textile.\u00a0 The list is rather impressive and it suggests this Coronavirus has somewhat panicked the markets and consumers.\u00a0 Yes, many of these consumers will continue to go out for food, entertainment, and other essentials \u2013 but what if 15% to 25% of them cut back on these activities and decide to stay home more often and watch movies or play games?<\/p>\n

I remember in 1990 when Desert Storm started.\u00a0 Just before this war started, the US economy was clicking right along.\u00a0 I remember that within 10 days of the war starting, things started to change on the roadways and markets.\u00a0 I also noticed a change in consumer spending with a friend\u2019s computer gaming distribution company.\u00a0 All of a sudden, consumers slowed their external purchasing activities and focused more on protectionist activities.\u00a0 We believe this same type of event is going to quickly unfold within the US and other nations as this Corona Virus extends over the next 30+ days.<\/p>\n

This is why I believe the volatility of price and market sector rotation will continue for at least 60+ days as the globe attempts to contain and eliminate the risks associated with this virus.\u00a0 We understand the risks in the US and Canada are very small at the moment, but that has not stopped shoppers from emptying the shelves at the local hardware and pharmacy stores for \u201csurgical masks\u201d and supplies.\u00a0 Trust us, people are already well into the protectionist-mode and are preparing for what may happen over the next 30+ days.<\/p>\n

This creates an opportunity for technical investors and traders.\u00a0 This potential for deeper price rotations and extended opportunities resulting from an end of bias volatile price exploration allows us to target very quick and exciting trades.<\/p>\n

In part II of this research post, we\u2019ll highlight three specific sectors we believe are poised for great trade setups as a result of the volatility and rotation in the global markets.\u00a0 Join us in our quest to create incredible profits from these bigger trends \u2013 visit TheTechnicalTraders.com<\/u><\/a><\/strong> today.<\/p>\n

Chris Vermeulen<\/p>\n

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 <\/p>\n","protected":false},"excerpt":{"rendered":"

By TheTechnicalTraders – We have been writing about the strong potential for a deeper market rotation in the US and global markets for well over 60+ days.\u00a0 In fact, our researchers predicted an August 2019 breakdown date based on Super-Cycle patterns that, eventually, pushed into 2020 as the US\/China trade negotiations and other global news […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-164559","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/164559","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=164559"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/164559\/revisions"}],"predecessor-version":[{"id":164560,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/164559\/revisions\/164560"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=164559"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=164559"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=164559"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}