Louise Yamada, CMT, is Managing Director of Louise Yamada Technical Research Advisors (LYA), the firm she founded in 2005 after a 25-year career at Smith Barney (Citigroup) where she had been Managing Director and Head of Technical Research. In order to have a long career, it is important to offer valuable market insights and Louise continues to do that. Louise has developed a framework for analysis that could be followed by anyone. Many readers of Technically Speaking will be familiar with the long-term and innovative nature of Louise’s work. Her book, Market Magic: Riding the Greatest Bull Market of the Century (John Wiley & Sons, 1998) walks readers through a process that applies standard tools of technical analysis in unique ways, often using relative strength analysis and charts that contain data spanning several decades. An example of this technique is shown below: The Capital/Consumer (C/C) ratio is shown at the bottom of

Editor’s note: Below are the latest thoughts on the stock market from this years’ Service Award winner. FEBRUARY WAS A CAUTIOUSLY OPTIMISTIC MONTH FOR THE BULLS; BUT THERE IS MORE WORK TO DO TO COMPLETE THE CORRECTIVE PHASE After a negative start to the year, the month of February clarified two things.  First, bearish forces are not going to have an easy time in defeating the 7-year bull market.  The S&P 500 was able once again to defend the key 1,800 – 1,850 support zone and then launch a good rally. Second, the status of the markets at the 1,810 low on February 11th suggests that the February low was an important event.  The bears suggest that the November to February action is the first leg down in a bear market.  Therefore, the 8% rally off the February low is just a minor counter-trend move that will be soon followed by another down leg

Editor’s note: this was originally posted at the Global Financial Data blog. It provides a historical perspective of the current market action. This year started weak. So weak in fact that the first ten trading days of January were the worst in US history.  The television is rife with talking heads exuberant over who they can point the finger at. “Oil,” one shouted. “Tech,” said another. A third bemoaned turbulence on the other side of the pond in European banks staring down a dry well of capital. Lastly, on February 10, 2016, Janet Yellen, the Chairman of the Board of Governors of the Federal Reserve Bank, faces tough questions from the White House on Capitol Hill, discussing the condition of the economy and interest rate hikes. Countries all over the world feel the crunch. Venezuela, with oil declines, is near bankruptcy. Brazil is buried under a staggering amount of debt. Japan has

The Charles H. Dow Award is presented annually for outstanding research in technical analysis. As the 2014 winners, Michael Gayed, CFA, and Charles Bilello, J.D., CPA, CMT, demonstrated, research can be put to practical use. They have used the analysis presented in their paper to manage mutual funds and separately managed accounts and have now created an index to track the results of their analysis. In their 2014 Charles H. Dow Award winning paper “An Intermarket Approach to Beta Rotation,” they outlined an indicator that switches in and out of the S&P 500 based on the recent price action of the utilities index. The chart below demonstrates that this idea could be used to time the market and also demonstrates Gayed and Bilello’s idea continues to work in the current market environment.