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BALTIMORE ( Stockpickr) -- As a stock investor, how often do you look at other assets? I mean, how often do things such as gold, bonds and the dollar factor into your stock analysis? For most retail investors, the answer is "not enough."
Today, we'll change that by taking an intermarket look at five charts every investor needs to see before June.
If you're wondering how gold prices might impact the value of your stock portfolio, it's a valid question. The fact of the matter is that all markets are connected. No, I'm not talking some kind of new-age spiritualism; all markets are
literally coupled together through factors like
flow of funds. It's a concept called intermarket analysis or global macro strategy on Wall Street.
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Put simply, markets are connected because all of the money that moves them is coming from the same place. When a portfolio manager decides to move more into bonds, for instance, chances are he'll have to liquidate some of his stocks to do it. That increased supply of stocks on the market and increased demand for bonds impacts the prices of both at the same time.
You can bet that intermarket analysis is something that institutional investors keep a close eye on -- so it makes sense for you to add these trades to your toolbox too. To do that, we'll turn to the technical.
If you're new to
technical analysis, here's the executive summary:
Technicals are a study of the market itself. Since the market is ultimately the only mechanism that determines a stock's price, technical analysis is a valuable tool even in the roughest of trading conditions. Technical charts are used every day by proprietary trading floors, Wall Street's biggest financial firms, and individual investors to get an edge on the market. And research shows that skilled technical traders can bank gains as much as 90% of the time.
Every week, we take an in-depth look at big names that are telling important technical stories. Here's this week's look at the technicals of
five must-see charts.