I just got back from a fantastic trip to Seattle for the stockcharts.com ChartCon 2018. It was a pleasure to reconnect many whom I consider mentors in my own career. Also great to meet others with a passion for technical analysis and data visualization. As with any productive conference, I took copious notes and have enjoyed revisiting some of the insights that I picked up during the two-day event.
I'm out in Seattle this week to speak at the stockcharts.com ChartCon 2018. Excited to be a part of a conference that features many speakers that I consider mentors, including Greg Morris, Martin Pring, and Tom McClellan. So far we've heard from Greg Schell, Dr. Alexander Elder, and Bruce Fraser. What struck me is that all three of them have discussed the importance of using stops.
It's so easy to reduce Behavioral Finance to a bottomless list of biases. As with many aspects of the financial industry, we get way too focused on labeling things instead of understanding them. A recent article from Behavioral Scientist pointed out the limitations of defining Behavioral Economics (which I tend to use interchangeably with "Behavioral Finance" because as far as I'm concerned they're the same thing) as a series of fallacies.
Predicting the future direction of the markets is 1) really difficult, 2) never about certainties, and 3) all about probabilities. Because of those three truths, I like to focus on price itself. As legendary technical analyst and mentor Ralph Acampora once said, "The only thing you can't restate is price." Three charts in my daily routine have started to turn from bullish to bearish, suggesting caution in the coming weeks and months.
Slowly but surely chipping away at my Pocket queue, I came across an article entitled "If You're Too Busy for These 5 Things, Your Life is More Off Course Than You Think." An article combining mindfulness with aviation was pretty much custom written for me!
Two themes stand out as I review the charts this week. First, the leadership of the supersized MANIA names that seem to dwarf everything else. Second, charts in the Financials sector that have been notable underperformers over the last six weeks. Let's review both of themes and let the charts tell the story.