The collapse in oil prices continue to wreak havoc in the Energy sector. The predictive properties of the Chaikin Analytics Power Gauge in individual stocks can help us forecast where money is likely to flow over the next 3 - 6 months, as the result of this major catalyst.. I look at the relationship between Bullish/Very Bullish and Bearish/Very Bearish stocks in sector ETF's or industry groups as a starting point, then fish for the best stocks. . Sector Trends powered by The Bull - Bear ratio from Chaikin Analytics and tracked at ChaikinPowerUser.com will help you do your own divining. This is a "quantimental" model that leans heavily on Fundamentals to help you accurately predict "where the puck is going".
Given the sector trend analysis, we're not inclined to bottom fish in Energy. Lack of fundamental strength backs up the extreme technical weakness there. The collective Power Gauges in XLE tell us that those stocks will be weak relative to the market over the next quarter or two. We'd rather put our money to work in Consumer Discretionary, where lower prices at the pump and forgiving winter heating bills will leave a few extra bucks in consumers' wallets for meals out and trips to Disneyland. The XLY has moved from Red to Green over the past few weeks.
That whopping jobs report not only adds tail winds to sectors and industry groups buoyed by consumer spending and late bull market economic expansion, but it will likely affect the market's opinion about the timing any Fed interest rate hikes. The XLF has undergone an accelerated shift to the bullish side of the market in recent weeks, and we've made sure to bolster our portfolio of Very Bullish sector stocks from strong industry groups likely to benefit.
The great thing about the Chaikin Analytics Power Gauge is that it help you avoid value traps. It depends on 85% fundamental metrics to develop its posture for individual stocks. The Power Gauge will often turn green ahead of technical strength. So I never chase beaten down sectors and industry groups that remain in the red.
Given the sector trend analysis, we're not inclined to bottom fish in Energy. Lack of fundamental strength backs up the extreme technical weakness there. The collective Power Gauges in XLE tell us that those stocks will be weak relative to the market over the next quarter or two. We'd rather put our money to work in Consumer Discretionary, where lower prices at the pump and forgiving winter heating bills will leave a few extra bucks in consumers' wallets for meals out and trips to Disneyland. The XLY has moved from Red to Green over the past few weeks.
That whopping jobs report not only adds tail winds to sectors and industry groups buoyed by consumer spending and late bull market economic expansion, but it will likely affect the market's opinion about the timing any Fed interest rate hikes. The XLF has undergone an accelerated shift to the bullish side of the market in recent weeks, and we've made sure to bolster our portfolio of Very Bullish sector stocks from strong industry groups likely to benefit.
The great thing about the Chaikin Analytics Power Gauge is that it help you avoid value traps. It depends on 85% fundamental metrics to develop its posture for individual stocks. The Power Gauge will often turn green ahead of technical strength. So I never chase beaten down sectors and industry groups that remain in the red.
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