Intermarket Analysis View Based on Options Analysis

Tom Gentile

Posted in
Daily Report

By: Tom Gentile
April 28th, 2022

3 mins read

Intermarket Analysis is where one analyzes more than one related class of assets – such as stocks, bonds, commodities, and / or currencies.

Analysis like this can either help determine the strength or weakness of the asset class being considered.

The man given credit for introducing this concept is John Murphy, a financial market analyst who wrote about this in his book, “Trading with Intermarket Analysis.”

It helps one ascertain an anticipated future direction on these different asset classes or what I call a ‘Corner’ of the market. Corners of the market such as stock, bonds, and commodities.

Why is Intermarket Correlations Important

This type of analysis is helpful in that it could provide insight into the future direction of financial markets.

It can either help provide confirmation a specific asset class or corner of the market as I like to call them (stocks, bonds, commodities)  and its probable direction is looking to go higher or lower. If an index representing equities like the S&O 500 is trading higher and you see that the oil stocks trade in correlation to the S&P 500 one could anticipate higher prices in oil so long as the overall larger market does.

With an analysis or assessment of two different corners of the market it could help with confirmation of where money may be flowing in to and out of each.

Market Correlations: Positive and Negative

Correlations are where you study two or more corners of the market and see how well they trade in relation to each other. If they correlate it means they trade in the same fashion. Or do they trade inverse or opposite direction of each other.

Positive Correlation: Positive correlation means the two variables tend to move in tandem. They trade in a lock-step fashion or direction.

Negative Correlation: Negative correlation, or what’s called an inverse correlation, is where the two or more corners trade inverse or in an opposite direction.

Take a look at the Morning Reports Data

If a day like today where the day was very bullish, and the markets closed at or near its highs it could be a signal money is flowing into equities.

And since equities and Gold tends to trade inverse or they have an Inverse Correlation to each other you would not be surprised when you see options on GOLD end up on the Unusually High Put Option Volume list. Put options are a connotation that the security is anticipated to go down.

Image 27

App: Toms Option Tools

Toms Option Tools scan the markets for bullish and bearish trade opportunities using our proprietary scans and strategy algorithms. TTR Darknet finds bullish entries based on triple stack channel collisions. Money Calendar identifies seasonal patterns with at least 90% accuracy looking back 10 years. Weekly Cash Clock finds short term opportunities that last a week on average. Microcurrency Trader applies Darknet technology and moving averages to cryptocurrencies. Velocity Trader utilizes volume spike and Velocity indicators on custom stock lists. Quantum Scripts scans the markets for momentum acceleration signals and employs Quantum noise filters. Optimal Trader finds directional pre-earnings opportunities that are optimized for entry date, stock movement, and volatility surge. My Trades tracks the profit/loss of your trades, displays stock charts and risk graphs, creates new trades, and edits existing trades. Morning Report provides top 10 option rankings in 6 categories each day.


Stock and options trading has large potential rewards, but also large potential risk.

You must be aware of the risks and be willing to accept them in order to invest in the stock and options market. Do not trade with money you cannot afford to lose.

This is neither an offer to buy/sell/ or recommend a particular stock or option.

Hypothetical or simulated performance results have certain inherent limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not been actually executed, the results may have under or overcompensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with hindsight.

No representation is being made that any account will or is likely to achieve profits or losses similar to those shown.

Disclaimer of Warranties and Liabilities Tom Gentile and TomsTradingRoom, LLC including employees, consultants, and editors (“Publisher”) cannot and do not warrant the completeness or accuracy of the content found in our areas, or its usefulness for any particular purpose.

Tom Gentile and TomsTradingRoom, LLC also make no promises that our content or the service itself will be delivered to you uninterrupted, timely, secure, or error-free. Under no circumstances will Tom Gentile and TomsTradingRoom, LLC be liable for direct, indirect, incidental, or any other type of damages resulting from your use or downloading of any content on our site.

This includes, but is in no way limited to, loss or injury caused in whole or in part by our negligence or by anything beyond our control in creating or delivering any portion of Tom Gentile and TomsTradingRoom, LLC.

You are agreeing that you bear responsibility for your own investment research and investment decisions. You also agree that Tom Gentile and TomsTradingRoom, LLC will not be liable for any I, investment decision made, or action taken by you, or others based upon reliance on news, information, or any other material published by Tom Gentile and TomsTradingRoom, LLC.

Tom Gentile and TomsTradingRoom, LLC relies on various sources of information that we believe to be accurate and reliable. However, we make no claims or representations as to the accuracy, completeness, or truth of any material contained on our site.

Tom Gentile and TomsTradingRoom, LLC are educational portals, providing content for educational and informational purposes only. Neither Tom Gentile nor TomsTradingRoom, LLC are a broker/dealer. Investors need a broker to trade stocks and options and must meet certain requirements. All securities, futures, and investments data and ideas are offered to self-directed investors. All prices in USD unless noted otherwise.

A full disclaimer can be found here:

Sign Up Now for Free Education!