30Oct12:40 pmEST

Coming Attractions

Putting storylines, conjecture, and fundamentals to one side, the monthly charts of VRX and SKX both tell a similar story--A steep multi-year uptrend now unraveling. 

The broad market bull run in recent years has seemingly defied gravity on many fronts for a while, ignoring most of the classic warning signs of a lack of underlying health. Moreover, historically unsustainably steep uptrends like those of VRX and SKX kept chugging higher...until they reached a tipping point.

And, now, as you can see, both steep trends are correcting, with perhaps more to come before any semblance of a bottom.

The critical issue then becomes which other types of charts are sporting similar steep trends which have yet to break. 

Despite completely different business models and public sentiment towards the respective firms, SBUX and NKE actually look like VRX did before the stretched rubber band snapped back. While that notion is sure ruffle a few fundamentalist feathers, the reality is that the market has priced in a plethora of "good news" into NKE SBUX for a good while. 

The VRX and SKX examples may very well serve as a sneak preview, or coming attractions, of what we can expect from those other, seemingly innocent, steep long-term uptrends. 

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