RRG Charts

Julius de Kempenaer
About the author: is the creator of Relative Rotation Graphs. This unique method to visualize relative strength within a universe of securities was first launched on Bloomberg professional services terminals in January 2011 and was released on StockCharts.com in July 2014. A graduate of the Dutch Royal Military Academy and former captain in the Dutch Air Force, Julius first began his career in the financial industry in 1990 as a portfolio manager. He is now the director/owner of RRG Research in Amsterdam.

Latest Posts

RRG Charts

Putting things into perspective for the FB face-plant

by Julius de Kempenaer

Facebook has been making headlines recently. Not only in the newspapers and online news services but also in some of the blogs at Stockcharts.com. With hindsight everything is easy and we can find many “signals” that “would have” given us early warning signals that we “should” have seen and the “could have” helped…. It is also very easy to find signals or methods that did not work. It happens, we all know that Personally, I am very reluctant to judge analytical methods that I am not, yet, too familiar with. For example, I am not an expert in Elliott Wave analysis Read More 

RRG Charts

A view on Asset Class rotation and the difference between open and closed universes.

by Julius de Kempenaer

Last week I was the guest of Tom and Erin in their Market Watchers Live show on stockcharts.tv. In that show, I talked about the difference between open and closed universes and what it means for a Relative Rotation Graph and following that discussion we had a look at the Relative Rotation for some Asset Classes on Relative Rotation Graphs. Summary Open vs Closed universes on Relative Rotation Graphs Real-Estate expected to rotate back down to lagging after recovery rally Commodities not able to turn LT trend around and now heading lower again Bonds Read More 

RRG Charts

Scanning 30 Dow stocks in two minutes on a Relative Rotation Graph

by Julius de Kempenaer

In this blog, I will take another look at the 30 stocks that make up the DJ Industrials index. A quick look learns that the real outsider in this index is GE which is positioned far to the left on the RRG, moving higher (almost vertical) on the JdK RS-Momentum axis but barely gaining on the JdK RS-Ratio scale. Inside the lagging quadrant PG, MCD and CVX are showing weakness with tails pointing in a heading between 180-270 degrees. The opposite is happening for BA and CSCO inside the leading quadrant. For a better analysis of Read More 

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Nine tech stocks to watch from an RRG perspective

by Julius de Kempenaer

An inspection of the weekly Relative Rotation Graph for US sectors at the beginning of this week (ending 2 March) reveals that we have: 3 sectors in leading 2 sectors in weakening 4 sectors in lagging 1 sector in improving Out of these 10 sectors, we have only 2 at a heading between 0-90 degrees (1 in improving and 1 in weakening) while 2 others are between 180-270 (1 in lagging and 1 in weakening) In this post, I will focus on the individual stocks in the Technology Read More 

RRG Charts

Painting the US equity landscape using Relative Rotation Graphs

by Julius de Kempenaer

Relative Rotation Graphs are a great tool to visualize sector rotation and that is probably where you will see them applied most. But they can be used for so many more (rotational) variations of different universes or similar universes in a different way. In this post, I will show you how we can use Relative Rotation Graphs to visualize rotation in US Equity markets based on growth, value, and size or market capitalization. And eventually, isolate the area of the market that seems to have the best opportunities in the next few weeks. Summary Read More 

RRG Charts

A few hundred points in the S&P 500.... Who cares?

by Julius de Kempenaer

The rough ride down in the markets last Friday was something that was probably expected by many but still came as a surprise. I am not a big fan of “calling tops”, or troughs for that matter. Mainly because many of these “predictions” have had many failed attempts to “call the top” before. There are a lot of people who have “called all 10 of the last 3 crashes….”  Instead, I am trying to look at what information the markets are throwing at us, especially in a situation like last Friday which was expectedly unexpected or vice versa. It’s easy to fall in the Read More 

RRG Charts

Relative Rotation Graphs are sending a clear message for Real-Estate (XLRE) and Utilities (XLU)

by Julius de Kempenaer

The Relative Rotation Graph shows the positions of US sectors against SPY as of 26 Jan. Sometimes the rotational patterns are not so clear but in this example, there is one observation sending a screaming message: Avoid Real-Estate and Utilities. At the other end of the spectrum inside the leading quadrant, we find a few sectors that show a more positive relative picture. XLY (Consumer Discretionary) shows up at the highest JdK RS-Momentum reading but at the same time has turned at an RRG heading of almost exactly 90 degrees where we prefer heading Read More 

RRG Charts

Using Relative Rotation Graphs(R) to get a handle on both price- and relative rotation in ONE picture

by Julius de Kempenaer

In my last blog, we looked at the 30 components of the Dow Jones Industrials Index and more specifically at the relative positioning and relative rotation of these 30 stocks around their common denominator the DJ Industrials index ($INDU). And despite the fact that this is valuable information you may want to keep an eye on the (absolute) price trends that are in play within that universe as well. The good news is that no new tools are needed to do that as Relative Rotation Graphs are fully capable of providing its “BIG picture in ONE picture” visualization from an Read More 

RRG Charts

Selecting stocks to watch (and avoid) in the Dow 30 using Relative Rotation Graphs(r)

by Julius de Kempenaer

  The Relative Rotation Graph shows the members of the DJ Industrials index against $INDU. This is a so-called closed universe which means that all elements that make up the universe are present in the plot. If we would calculate all the distances (vectors) from the center of the chart to the various stocks (market cap weighted) and add them up the result would be zero. The two stocks that immediately stand out are GE and MRK, although both are showing an uptick in relative momentum (rising JdK RS-Momentum)they remain deep inside the lagging quadrant. Read More 

RRG Charts

Relative Rotation Graphs suggest to stick with equities (SPY) while keeping an eye on commodities (DJP) going into 2018

by Julius de Kempenaer

As 2017 draws to an end, the Relative Rotation Graph for asset classes is sending a very clear message! Equities are leading the way into 2018! The RRG above shows some ETFs representing various asset classes and uses VBINX, a balanced index fund, as the benchmark. With only SPY, representing the asset class equities, inside the leading quadrant and ALL others inside the lagging quadrant, the message could not be more clear. Summary All fixed income related asset classes are inside the lagging quadrant With only Read More 

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