The study of the relationship between different markets using technical analysis is called Intermarket analysis and is a relatively recent development.
The Intermarket analysis uses technical analysis to identify market trends and their correlation. Thus a different but related market is used to call turning points and trends in another market. There are three primary relationships that Intermarket analysts follow.
Stocks versus Bonds
Bond prices usually move in the same direction as stock prices, mainly due to the influence of interest rates. Falling interest rates are favorable for bonds and equities. A key point to remember here is that the bond market (or prices) historically peaks and bottoms before the stock market.
This is a Premium Content
Login if you have purchased
Membership
Get Access to all the Premium Content.More than 100+ Articles, Mini Courses, Quizzes and Contests.