Tracking the Correlation: Why Bitcoin’s Lower High Matters

 

Above is a 4-hour chart of Bitcoin futures, and in the lower pane I’ve plotted the E-mini S&P 500. The first thing that really stands out to me is how closely these two markets tend to track each other. Some people love to argue that the S&P has nothing to do with Bitcoin, that one is a risk on tech proxy and the other is some independent digital asset, but when I actually look at the charts I see a different story. The price action tells me that these markets often move in tandem, meaning they make highs and lows at roughly the same time.

For me, that correlation is important because it gives context to what Bitcoin is doing beneath the surface. When two markets with very different narratives still line up structurally, it tells me the same institutional flows may be influencing both.

Now take a look at point B on the chart. Bitcoin is making a lower high compared to point A, which is always something I pay attention to because it can signal exhaustion. But at the same time, the S&P 500 just made a slightly higher high today. That divergence really catches my eye. When a correlated market makes a new high while the other fails to confirm it, it often has bearish implications for the weaker one and in this case, that’s Bitcoin.

Going into next week, I’ll be watching Bitcoin closely for breaks of support. If those levels start giving way, I’ll be looking for short entries based on this divergence setup.

Follow Your Own Light: The Key to Trading Success

 

Trading can be overwhelming. There are so many indicators, systems, and strategies out there, and it's easy to get lost in the noise. Over the years, however, I've learned one essential truth, every trader must follow his/her own light. What works for someone else may not work for you, and that's okay. Find what resonates with you, what makes sense, then learn everything you can about it.

Finding What Resonates

That guiding light for me has always been relative strength. Unlike so many technical indicators, which will wildly fluctuate depending on your inputs or the timeframe you're looking at, relative strength is tangible, it is a measure of how a stock is performing versus the market or a benchmark. It doesn't change because I fiddle with the moving average or go from a daily to an hourly chart. It's real; it's consistent; and it tells a clear story.

It finally happened, but not overnight. I had tried dozens of indicators, read books, watched videos, and also followed other traders. Some systems appeared to be good on paper, yet didn't fit my perception of the market. Others were too complicated, either using numerous confirmations or rules that seemed arbitrary. I realized then that if I was going to make it, I had to find the approach that resonated with me, the one I could understand deeply and instinctively trust.

Conquering Your Chosen Path

Once I found relative strength, the search for the perfect system became less important; it was, instead, about learning as much as I could about relative strength. I studied how it acts at market tops and bottoms, how it acts relative to volume, and how leaders emerge over time. I experimented, taking lots of notes and tracking down endless amounts of results. The deeper I dove, the more intuitive it became. I wasn’t just following a rule; I was learning to read the market in a way that felt natural to me.

This is the important part about following your own light: mastery comes from focus and persistence. You can't rely on an indicator or system if you've only scratched the surface. You have to understand its strengths, its limitations, and how to interpret it in context. The more familiar it becomes, the more confident you can be in your decisions, and confidence is everything in trading.

Trusting Your Own Process

The journey of trading is personal. What works for me might not work for you, and vice versa. Some traders find their 'light' in Fibonacci retracements, others in moving averages, while others may use the most complex algorithms. Mine is relative strength. The key here is not in comparison; it's in self-discovery. You have got to trust your own process and be willing to commit fully to it. Following your own light also means being patient. The market will test you and there will be times when you doubt your approach. But the more you understand your chosen method, the more resilient you become. You learn to trust what you see and feel in the market rather than what someone else tells you.

Final Thoughts 

What works for one individual might not work for another, so every trader must find the tool, indicator, or philosophy that resonates with them. To me, it is relative strength because it is real, consistent, and understandable. To you, it could be anything. The most important thing is to find your own light, learn all about it, and then follow it with confidence. That is how actual mastery and consistent results are built.

For more relative strength insights and recent market posts, visit the homepage at The Relative Strength Trader

Relative Weakness in NFLX You Can’t Ignore

 Above is a 60-minute chart of NFLX with the SPY plotted in the lower pane, and while I’ve been a long-term fan of Netflix as a company and as a stock, I can’t ignore what the price action is telling me right now. One of the most important lessons I’ve learned in trading is that even the strongest long-term winners can go through periods of relative weakness, and that’s exactly what I’m seeing unfold at the moment.

If you look closely, the SPY is either making a higher high or at least retesting the highs we saw about three weeks ago. But NFLX? It’s not even close. Instead of matching that strength, it’s printing a noticeably lower high. The white trendlines on the chart make this contrast incredibly clear. When the market is strong and a leading stock lags behind, that’s often a warning sign that shouldn’t be brushed aside. This divergence is what I call true relative weakness, it’s subtle at first, then obvious in hindsight.

Heading into the next session, I’m keeping a close eye on today’s low at 101.77. If NFLX breaks below that level, it could easily trigger a continuation move to the downside. And with the psychological $100 level sitting just beneath, that zone becomes an even more natural magnet for price. Traders will be watching it, algorithms will be watching it, and I will be too.

For now, NFLX stays on my radar, not as a long-term investment story, but as a short-term relative weakness setup that deserves respect.

For more of my daily market breakdowns, you can head over to my homepage: https://therelativestrengthtrader.blogspot.com/

After Five Weeks of Selling, Uranium Stocks May Have Turned the Corner

 

Today was an impressive day for uranium and nuclear stocks, with the URA ETF soaring 5.45%. After a challenging five-week period of selling pressure, it appears these stocks may have finally found a bottom. The sharp rebound today suggests that sentiment could be shifting, and traders like myself are paying close attention to potential buying opportunities.

One stock that stands out to me is NNE. Looking at the weekly chart, you can clearly see a well defined upward channel. The channel has multiple touches on both the support and resistance lines, which adds credibility to its structure. Patterns like these are particularly useful because they give a visual framework for potential entry and exit points.

Another encouraging sign is the declining volume over the past five weeks. During a pullback, decreasing volume is exactly what you want to see, it indicates that selling pressure is easing and that the decline may not have strong conviction. This sets the stage for a potential resumption of the upward trend.

Going forward, I’ll be closely monitoring the daily volume on NNE. If volume begins to pick up on pullbacks or during moves higher, it could confirm renewed buying interest and provide a favorable environment for entering trades. My plan is to look for pullbacks within this channel as potential buying opportunities, using volume as a key confirmation tool. Overall, while caution is still warranted, the technical setup in NNE and the broader uranium sector is starting to look promising for those ready to capitalize on a potential rebound. Explore more trading ideas at The Relative Strength Trader

CURLF Takes the Lead: Relative Strength Breakout as MSOS Approaches $4

 Looking at the chart on the left which is a daily MSOS chart, the first thing that stands out is how price is finally starting to push through the downtrend line that’s been in place since the October highs. This is the first sign of developing strength we’ve seen in a while, but for the momentum to truly shift back to the upside, MSOS still needs to close above that key $4 level. A breakout through that area would confirm that buyers are finally stepping back in and that this downtrend may be coming to an end.

On the right side of the screen is a daily chart of CURLF, and there are two important takeaways here. First, CURLF has closed above its own downtrend line which puts CURLF in a stronger technical position. But what really grabs my attention is the lower pane, where I plot a relative strength line of CURLF versus MSOS. That RS line has already broken out to a new high. If you’ve followed my work, you know how important relative strength is in my trading approach. I've written about this concept many times but for further review you can check out this post: Using Relative Strength in Trading: A Key Tool for Market Outperformance

The fact that CURLF is showing relative strength before the broader cannabis ETF turns up tells me one thing: CURLF is starting to take on a leadership role. If MSOS can get moving, I expect CURLF to be one of the names leading the way. Stay tuned.