One month ago today, I suggested to “Harvest Gains” in Chile (see post here) after a quick 10% gain, YET ON THE SAME DAY I SUGGESTED TO “Buy Emerging Markets (EEM) and Brazil (EWZ)…(see post here).
Did anyone think……What the heck? Why would he suggest to do that? Was Chile broke? If Emerging markets and Brazil look good, won’t Chile do well too?
It’s all about the “Power of the Pattern” and looking for RELATIVE STRENGTH!!! Below is a 30-day performance comparison of Chile, Emerging markets, Brazil and Turkey (see post here).
Are all Emerging markets ETF’s performance the same? The chart above speaks for itself.
Why have I suggested on numerous cases to BUY SILVER OVER GOLD? (see post here) Something wrong with Gold? Not at all… I favored Silver over gold due to the “Power of the Pattern!” Has gold done well of late?
In the past month Gold ETF (GLD) is up 8% and Silver ETF (SLV) is up over 16%. That is a DOUBLE in performance…TRUE RELATIVE STRENGTH!
Have received numerous emails today per why did I suggest to buy the Nasdaq 100 (see post here) over the S&P 500? Nothing more than I see better opportunities and relative strength in the NDX.
Why own Oil Driller (OIH) over Energy ETF (XLE)…(see post here) same thing. Better “patterns” were at hand, which more often will lead to greater relative strength gains.
Per relative strength…this is something that my research provides, not aware of anyone that provides “pattern relative strenght.”
Dorsey, wright and Co, provides great work on momentum relative strenght though.
What is the easiest method to find high relative strength?
haha, that was exactly what i was thinking (your 2nd paragraph).
In fact, i couldn’t bring myself to sell ECH since it didn’t make sense at all to sell it and then buy EEM.
So thank you for such great follow-up posts explaining the method to the seeming madness.