When we talk about asset allocation, similar questions often come up: More International stocks? More Emerging Markets? More US Investments? Where do we rotate as we head into next year? These are all common themes normally brought up in this type of conversation. So using only facts to help our decision making, let's look at price and see what, if anything, it is pointing to.

This is a chart of the S&P500 ETF $SPY compared with the ACWI Ex-US Index ETF $ACWX:

Last week I shared with you guys a "Mystery Chart" without any labels on it. The point of this exercise is to eliminate any biases and focus only on facts. The only truth in the market that we can count on is price. Sell side analysts are going extinct because they offer little value, the media is often either wrong or lying to you, the same can be said about C-level executives, and the list goes on and on. None of these people are reliable. This is why the only thing we can count on is price. It's just math. So we prefer to focus on that and ignore the rest of the noise.

Today we're looking at a rare development in economically sensitive assets that I think have much broader implications for stocks and commodities moving forward:

There have been a lot of really amazing moves this week in the market. But one interesting development that I don't hear much chatter about is the monster move in Value stocks vs Growth stocks. Value stocks like Berkshire Hathaway and JP Morgan have exploded higher the past week at the same time that Wells Fargo stopped crashing. Meanwhile, in Growth land Amazon and Facebook have had a tough time. You can see this beautifully in the charts.

Over the past few days I've received requests from readers about my thoughts on Russian stocks. While I don't particularly care about the US/Russia relations when it comes to picking stocks to buy and sell, it seems to be something of interest to a lot of people. So let's dive in.

Every now and then I throw out a mystery chart just to get us thinking. Not knowing what a chart represents helps eliminate biases or any ideas we may already have in our heads. Today we are looking at what I think is one of the more interesting developments in the market today.

Every month I host a conference call for All Star Charts Members where we discuss ongoing themes throughout the global marketplace as well as changes in trends where new positions would be most appropriate. This includes U.S. Stocks & Sectors, International Stock Indexes, Commodities, Currencies and Interest Rate Markets. Transports and Copper continue to make new highs while US Treasury Bonds keep selling off on the back of higher interest rates. We'll discuss all of these issues and more.

This month's Conference Call will be held on Tuesday November 15, 2016 at 7PM ET. Here are the Registration Details:

When it comes to the U.S. stock market, there are a bunch of popular stocks that many consider important bellwethers that could give clues to the health and direction of the overall market. Personally, I look at shares of J.P. Morgan Chase (JPM). They have a long track record that goes back to the 19th century. More importantly, with a market cap of $250 billion, this bank has a huge influence on the financial sector, not to mention the entire market. But even more telling, in my view, is the historically high positive correlation between J.P. Morgan shares and the S&P 500.

There is a lot of noise out there about the Mexican Peso and the Presidential Elections. So I can't think of a better time to focus on the supply and demand dynamics in the forex markets to see if we can determine the most likely direction of the Peso. Fortunately, as technicians, we can just ignore all that junk and spend our time on the only factor that actually pays, which is price.

Throughout the second half of 2016 I've remained in the camp that interest rates are going higher and that bonds are a fade. The action into 4th of July weekend originally put me in that camp and I continue to believe that, bigger picture, this is the underlying trend that we need to respect. The catalyst here, in many cases, is becoming more and more clear with each passing day. Forget the economy and the stock market, inflationary forces are moving in sync with the bond market suggesting a very high correlation between the inflation trade and higher rates.

Let's break this down using math and blatantly ignore anything the federal reserve has to say. Listening to them has been a time waster and money loser for years. I don't expect this trend to change any time soon. I'm sure they are nice people, but from a portfolio construction perspective, they offer absolutely zero value, and some might argue that listening to the fed is actually detrimental to a sound investing plan. I agree with both the latter and the former: that noise is toxic on all accounts.

Transports this week are hitting new 6-month highs relative to the S&P500. Remember, these guys have been the leader for years. To review, the Dow Jones Transportation Average peaked in late 2014, well before the S&P500 put in its final top in May of 2015. Moving forward, the Dow Transports put in their bottom in January of this year, the month before the S&P500. So yes, we want to continue to look to the Transports for leadership.

Today we are breaking down the Transportation stocks once again to see what is really happening underneath the surface:

With all the noise surrounding U.S. elections this month, we have seen very little coverage about the recent surge in base metal prices. Sure, everyone is talking about gold hitting a monthly high, but don’t let the shiny metal blind you to what is happening with such base metals as aluminum, nickel and tin. You don’t have to travel too far back in history to see what has happened to U.S. stocks when those base metals start making some noise.

Register here for our live monthly conference call for Premium Members of All Star Charts India.

November's Strategy Session will be held on Wednesday, November 3rd at 7 PM IST. As always, if you cannot make the call live, the video and slides will be archived and published here along with all of our past conference calls.

Here are the details for Tuesday:

You guys know that I consider the S&P500 to be just one index in just one country in just one asset class in the entire world. There is a lot more out there. And while this might be true, I would also argue that this one index is one of the more important ones that we need to be watching. It is a good representation of U.S. Stocks, since the Dow Jones Industrial Average is just 30 names, the Nasdaq is tech-heavy and the NYSE Composite has a lot of international exposure. One can argue that the Russell3000 is the best representation of the U.S. since it represents over 98% of all investable assets in U.S. equities, but there is no liquid asset to gain exposure to it.

So today we are breaking down the S&P500, setting price targets and defining our risk management levels:

It's important to recognize what type of environment we're in for the market. During different times of the year, traders and investors tend to behave in certain ways. When you smooth out the data over many years, their patterns become clear. We all hear about, "Sell in May and Go Away", but what about, "Remember to Buy In November"?

Today we're focusing in on the end of what is historically the worst seasonal period of the year for the Dow Jones Industrial Average. So what happens next?

Every month I host a conference call for All Star Charts Members where we discuss ongoing themes throughout the global marketplace as well as changes in trends where new positions would be most appropriate. This includes U.S. Stocks & Sectors, International Stock Indexes, Commodities, Currencies and Interest Rate Markets. We have been bullish towards both U.S. and International stocks since early July and are seeing money rotate into new sectors and countries showing leadership. We will be discussing this in detail on Tuesday.

We will also be focusing particular attention to the recent sell-off in precious metals and rally in US Interest Rates.

This month's Conference Call will be held on Tuesday October 18, 2016 at 7PM ET. Here are the Registration Details:

With volatility spike in British Pounds, the more interesting story to me is how stocks are pushing up against the former all-time highs in 1999. Since that historic era in the stock market, British stocks have continuously attempted, and then failed to break through and finally make a new all-time high. The London FTSE 100 has been trying to stay above that historic market peak for almost 17 years.

Here is a chart of the London FTSE 100 going back to the late 1990s. The more times that a level is tested the higher the likelihood that it breaks. The reason is that there comes a point where anyone willing to sell at those levels will have already sold, ultimately leaving fewer sellers than buyers. This is when you get a "breakout":

This week high beta stocks are hitting fresh year-to-date highs relative to stocks with low volatility. This is a new trend, as lower volatility stocks did better than their higher beta counterparts in both 2014 and 2015. But this year has been a completely different story and it does not appear to be stopping.

Here you can see that while the S&P 500 was putting in new highs into May of last year, the ratio between high beta stocks and low volatility stocks had already peaked and was putting in a lower high. We are using the Powershares S&P 500 High Beta ETF $SPHB and the Powershares S&P 500 Low Volatility ETF $SPLV for the chart below.

The headline writers do their best to make you think that Gold is a US Dollar story. But in the real world, the one we're all forced to live in, Gold is a Gold story. It really has nothing to do with the US Dollar, and if you price gold in the other currencies, you'll see that very quickly. While gold might be struggling when priced in US Dollars, if you look at it priced in a weaker currency, say emerging markets, you'll see a completely different picture.

Today we are looking at Gold priced in an equal-weight basket of Emerging Market Currencies, specifically the BRICS:

Have you guys noticed that the prices of Gold and Silver have gone nowhere for 3 months? There's a reason why we've wanted to stay out of this market since early July and let them digest their impressive gains since the January lows. Knowing when to stay out of a market is just as important as knowing when to be in it. Opportunity cost should also be considered in the risk calculation.

Today we are taking a deep dive into Gold and we're going to look at things from all angles, all currencies and all time frames.