Rotation Report: Huh?

There are plenty of mixed signals in the broad indices these days.  Just guessing and reading some of these indicators we'd guess the market would've dipped by now.  But, this last month's rally caught many professionals off guard and the lagging fund managers are taking every opportunity to add alpha and bid up various stocks.

As @awealthofcs tweeted the other day:    

Career risk is probably the most misunderstood/underestimated risk that investors don't pay attention to
— Ben Carlson (@awealthofcs) November 13, 2014

This won't change into the end of the year.  There will certainly be opportunity in various stocks even within an upcoming pullback/correction whatever.  What's important from a trader or individual investor's standpoint is to not to anticipate a pullback in our stocks or anticipate your stop being hit.  Each stock is different and our best winners likely won't even trigger the stop.

With that, let's dig in!

Microcaps tried to break the year long resistance line and failed this week.  Is this the bears last hope?

Vol structure is still in the toppy zone.  It hasn't mattered much last week but it does matter.  

S&P 500 breadth is still in a corrective phase.  The market is thinning out and that is a problem in the short run.  As you can see, it didn't prevent a grind higher in 2012.

One huge potential piece of evidence for stock bulls is the S&P div index relative to the S&P 500.  Is that a false break over long time resistance?  Dividend names look to be out of favor here.  Managers want beta.

The highly publicized breakdown in consumer discretionary relative strength has reversed!

The consumer ratio has now developed a long term support trend line.  This has become a clear positive for equities although we'd like to see more evidence like a higher high to confirm it.

The transports have led but are back at upper boundary resistance.  What's different this time?

The corporate bond ratio is still pointing lower and may have peaked nerm term.  Will the August lows hold?

The dollar traded pretty awfully Friday.  This is trading like a top in the making, but we don't have the evidence to call it that yet.

It's also pretty extended on the weekly chart as it approaches long time resistance.

Oil volatility has wedged for a month.  The oil market is the market to watch this week.

If you want to buy an energy producer, why not EOG?  The long time out-performance is staggering.

Nat Gas may have bottomed Friday after dropping as much as 15% during the week.

Is Copper trying to find a bottom here?  It sure looks like it.

Brazil dropped back down near the key post election low and was bought once again.  The risk -reward long is favorable, but are the probabilities?  I think so.  Any possible bottom in the mining group would be an added tailwind short term.

Is that a head and shoulders bottom in EEM?  That could be a huge boost to the global markets.  

Trade 'em well!