Archive for the ‘Chart School’ Category

Friday Kept Week’s Performance Intact – Semiconductors Strong

Courtesy of Declan.

Memorial weekend brought with it holiday style trading on Friday. It was positive finish for bulls who were able to maintain and in some cases, build on, gains from earlier in the week




Best of the action came in the Semiconductor Index which finished with a new closing high. The rally from April brought with it an acceleration in pace, comparable to the latter part of 2016.  Relative performance against the Nasdaq 100 hasn’t breached resistance, but it’s very close. Semiconductors spent a long time in the doldrums after the 2000 peak, but they are finding their groove now.






The S&P tagged new support and next week will be about consolidating itself above 2,400.  Technicals are bullish with the MACD on a ‘buy’ trigger above the bullish zero line with an uptick in accumulation based on On-Balance-Volume and relative performance against the Russell 2000.





It was a similar story for the Nasdaq as for the S&P, except its job is to stay above 6,170. Technicals are net bullish with a good ‘buy’ trigger in the MACD timed with the breakout.





The Russell 2000 remains the ugly duckling.  Flat-lined moving averages highlight the scrappy nature of recent trading. This may be an index to accumulate as a long-term buyer, but it’s not one to trade.





The last chart is one for long-term buyers. It has been clear from 2014 through to today that commodities have underperformed, but this means value opportunities for those willing to look past current struggles. Remember, this is a monthly chart so don’t be looking at the day-to-day machinations, instead, aim to build positions over time in commodities and equities with heavy commodity exposure.





Enjoy the weekend.




You’ve now read my opinion, next read Douglas’ blog.




I trade a small account on eToro, and invest using Ameritrade. If you would like to join me on eToro, register through the banner link and search for “fallond”.




If you are new to spread betting, here is a guide on position size based on eToro’s system.









One Bank Spots An “Amber Warning Sign” Inside The Vol Complex

Courtesy of Zero Hedge

In a time when record low volatility has spawned a cottage industry of vol and Vix experts, with analysts desperate to explain either why volatility is where it is [or where it will be next week], here the simplest explanation is [that] the record injection of liquidity by central banks pushing risk assets to all time highs [and] the fact that even hedge fund are barely trading as we showed last week (chart). [Even] though there is no causal link between backward-looking implied or realized vol and future events, few have come up with a comprehensive analysis or theory of which volatility metric is relevant or appropriate when discounting risk inflection points.

One such attempt, one of the better ones we have seen, comes from Deutsche Bank's Dominik Constam who in his latest Global Market Strategy letter believes he has found what may be a fulcrum predictive vol indicator which, as he writes overnight, is "an amber warning sign that momentum in stocks might be peaking over the coming months."

As Konstam simply frames it, "in general equity prices are negatively correlated with volatility, which is consistent with an emphasis on protection and levered exposure to the upside. Rising prices are associated with falling volatility and falling prices with rising volatility. Rising (and expectations of rising) prices convert call exposure into the underlying and reduce concern for the need for protection. Volatility demand is satisfied at lower volatility prices. Falling prices creates more concern for protection."

That – absent any reference to Greek letters, to central banks, to CTAs and risk parity funds, or to vol ETFs – is about the simplest, and most accurate explanation for why vol is where it is at any given moment. What does it mean for the future?

Spikes higher in correlation, either much less negative correlation or positive


continue reading





Ben Carlson on Market Breadth

 

Ben Carlson on Market Breadth (Video)

Courtesy of Joshua Brown, The Reformed Broker

Ben had a hit on Bloomberg TV last night talking about his recent piece on market breadth and why it’s perfectly normal to see the market being led higher by some very big winning stocks. His research shows that this is always the case during bull markets and that broader measures of the internals are healthy, not sick.

Check this out:

…and you can read his expanded thoughts on the topic here:

A Few Big Stocks Don’t Tell the Whole Market Story (Bloomberg View) 





Big Financial Stocks Face Their 50-Day’s

 

Big Financial Stocks Face Their 50-Day’s

Courtesy of Joshua Brown

Lots of big financial stocks have run back up into their declining or flat-lining 50-day moving averages into the end of this week. If we’re truly headed higher in the overall US stock market, tech could use some help from the banks and brokers. Hard to persist in the narrative that only a handful of tech giants are driving the SPX if the banks get back on the horse.

I pulled a few of these from ycharts.com that I thought were worth watching, relative strength in the bottom pane…

?

Source:

ycharts.com





S&P Breakout on Higher Volume Accumulation

Courtesy of Declan.

While I expected the Dow Jones to be the breakout flyer, instead it was the S&P which led the charge on higher volume accumulation.  Technicals are all in the green with a return of the MACD trigger ‘buy’.






The Dow did manage to break past 21,000 with a MACD trigger ‘buy’ but it’s still contained by all-time high resistance at 21,200. The index is still well positioned for a larger breakout, but this is the sixth day of consecutive gains for the index so some pullback can be expected.





The Nasdaq posted the best gain of the day with a supporting MACD trigger ‘buy’ above the bullish zero line. Remaining technicals are firmly bullish. Momentum players have most to gain here with shorts out on a limb (at best).





The Russell 2000 started to struggle today.  While other indices enjoyed classic gains, the Russell 2000 experienced an indecisive ‘spinning’ top.  Resistance remains in play and this could still be a factor tomorrow.





For tomorrow, bulls should be looking for pullback opportunities in the Nasdaq and S&P, or a push to new highs in the Dow Jones Index. Shorts may find some joy in the Russell 2000 as the relief rally begins to struggle.




You’ve now read my opinion, next read Douglas’ blog.




I trade a small account on eToro, and invest using Ameritrade. If you would like to join me on eToro, register through the banner link and search for “fallond”.




If you are new to spread betting, here is a guide on position size based on eToro’s system.









Gold supply and demand battle near resolution

Courtesy of Read the Ticker.

gold-supply-and-demand-battle-near-resolutionEnergy builds up during a long slow sideways pattern which allow money managers to accumulate or distribute float, very soon either the demand or supply side is going to get knocked out. Soon we well have a winner! Both the moving averages and Gann angles show the tight APEX, a break out either way will happen. Our bias is to the upside.



If you review a hand full of gold stocks (say ABX, NEM, GG, HMY) you can see higher lows, and consolidations tightening after a period of volatility, this means those that wish to sell from the recent rally have done so, there done! Now the time for the next move is very near. The good news is that most big money managers missed the 2016 rally, and they are getting ready for the next move higher (we believe).



The commodity (gold) is bullish, the stock sector (gold stocks) is bullish. This means the money is moving in, setting up for a move higher.



tic tic boom!



Gann Angles



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Gann Gold




Moving Averages



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Gold SMA






NOTE: readtheticker.com does allow users to load objects and text on charts, however some annotations are by a free third party image tool named Paint.net



Investing Quote…



..”Don’t take action with a trade until the market, itself, confirms your opinion. Being a little late in a trade is insurance that your opinion is correct. In other words, don’t be an impatient trader”…



Jesse Livermore





…..“I measure what’s going on, and I adapt to it. I try to get my ego out of the way. The market is smarter than I am so I bend.”..



Martin Zweig





..”If past history was all there was to the game, the richest people would be librarians”..



Warren Buffett





..The time of maximum pessimism is the best time to buy and the time of maximum optimism is the best time to sell”..



John Templeton





Unless you can watch your stock holding decline by 50 per cent without becoming panic stricken, you should not be in the stock market.



Warren Buffett











Rally Keeps Going But New Highs Await

Courtesy of Declan.

The S&P is only a short step away from confirming new highs, but today’s action will have kept shorts wary with the risk of whipsaw high. A simple push above 2,406 could deliver an acceleration higher. The one disappointment is the light volume.






The Nasdaq isn’t quite as close to the S&P in marking a new high, but today’s action did negate yesterday’s bearish ‘black’ candlestick. The ‘bull trap’ is just a few points away from being consigned to history – can tomorrow deliver?





Finally, the Russell 2000 still works towards negating last Wednesday’s loss (with a lot more to do beside that).  Its next challenge will be clearing the 20-day MA.





One index which is offering itself as a decent looking breakout candidate is the Dow Jones Industrial average; a decent handle has shaped over the course of April-May.





For tomorrow, bulls should watch the aforementioned Dow Jones. Bears may find joy in a quick reversal of the S&P or Nasdaq, but it would not be a trade to linger in if the position moved against you early.




You’ve now read my opinion, next read Douglas’ blog.




I trade a small account on eToro, and invest using Ameritrade. If you would like to join me on eToro, register through the banner link and search for “fallond”.




If you are new to spread betting, here is a guide on position size based on eToro’s system.









Market Rallies Slow Down

Courtesy of Declan.

For the fourth day in a row, markets generated gains to leave markets on the verge of new highs – erasing the losses of last week. However, today’s gains were small leaving markets vulnerable to attack from shorts.




The Nasdaq and Nasdaq 100 finished with bearish black candlesticks; black candlesticks at swing highs are often associated with market tops. Shorts can look to take advantage with stops above the recent highs with a target of last weeks lows (for starters).









The Russell 2000 finished with a closed above its 50-day MA after managing to reverse intraday selling. However, unlike the Nasdaq, the index hasn’t yet clawed back the losses from last Wednesday’s sell-off.





Meanwhile, the S&P closed the breakdown gap with a relatively straightforward advance. Technicals have recovered, leaving only the MACD on a ‘sell’ trigger. While other indices edge more in favour of bears, the S&P might surprise with additional upside. If so, tomorrow has a strong chance of delivering those new highs.





While one can only best guesstimate what will happen tomorrow, the tight action in many of the indices does open swing trade opportunities. These can be done by entering a trade on a break of today’s high/lows with a stop on the flip side of Tuesday’s high/low – or by buying an option straddle. Markets are primed for another big move, the question is which direction will it take. The option straddle perhaps offers the best cover, but may not be suitable for everyone.




You’ve now read my opinion, next read Douglas’ blog.




I trade a small account on eToro, and invest using Ameritrade. If you would like to join me on eToro, register through the banner link and search for “fallond”.




If you are new to spread betting, here is a guide on position size based on eToro’s system.









Gains Push Into Breakdown Gap

Courtesy of Declan.

While today’s gains were modest they were significant in generating clean pushes inside last week’s breakdown gaps. This brings indices back to challenge ‘bull traps’




The S&P experienced lighter volume trading as On-Balance-Volume moved to a ‘buy’ trigger. Today’s action opens up for a challenge of 2,405, although shorts may see this as opportunity to go aggressive with a tight stop once markets makes all-time highs.






The Nasdaq is also approaching its ‘bull trap’. On-Balance-Volume holds to its accumulation trend while the MACD is on a ‘sell’ trigger. As with the S&P the Nasdaq could see a challenge on the ‘bull trap’ tomorrow.





The Russell 2000 had the best of the day’s action, but it only took the index back to its 50-day MA. Technicals are all in the red, but the risk:reward for the index remains poor particularly with the index stuck inside the 6-month trading range – a push back to 1,390 might make this a better short play.





The Nasdaq 100 looks like it will be challenging the doji with a high of 5,724 tomorrow. However, if this breaks above 5,724 then next up will resistance of the 6-month rising channel (blue hashed line).





Markets might squeeze another day of gains before profit takers and shorts pay a visit. If there are more gains then a parabolic move higher could emerge if all-time highs are breached.




You’ve now read my opinion, next read Douglas’ blog.




I trade a small account on eToro, and invest using Ameritrade. If you would like to join me on eToro, register through the banner link and search for “fallond”.




If you are new to spread betting, here is a guide on position size based on eToro’s system.









Political Theater Matters for a Moment! It’s the Stock Trader Weekly Recap.

Courtesy of Blain.

Finally some action out there!  The comatose market of much of 2017 finally saw some volatility with a large drop Wednesday as the political theater finally hit markets, but that was offset by solid gains Monday and Friday.  Wednesday’s move was the largest drop since September 2016 (!!!) but in the end bears could only push the S&P 500 back 0.38% for the week.  Until Wednesday’s move the S&P 500 had been on the longest streak of 0.5% or less daily moves since 1969!

“This isn’t about who is right or wrong; it is about a concern that a number of things could derail the future of economic growth that were not present a month ago.” Kevin Giddis, head of fixed-income capital markets, said in a research note.

“Even though optimism for Trump’s pro-growth agenda has mostly unwound, if this political crisis deepens and elevated volatility persists, equities could see further weakness in the short-term driven by deleveraging across fundamental and systematic strategies,” J.P. Morgan wrote in a note to clients, adding that “fundamentals remain supportive.”

The probability of a Trump impeachment has gone up after the recent events, analysts noted, with bookmaker Paddy Power’s odds reflecting a 33% chance it could happen. An impeachment requires the backing of two-thirds of the Republican-controlled Senate.

Many are pointing to the massive global asset purchase by central banks which is keeping markets elevated and tapping away volatility and so much money is chasing so few assets.  Here is a fascinating chart on the scope – that’s about 9 TRILLION thrown at assets in the past decade.  With 2 TRILLION of that in the past 12 months.

“It’s a battle of bearish political headlines versus bullish liquidity where liquidity has the upper hand. Like an IV drip, the world’s central banks, the Fed included, continue to buy financial assets with printed money,” said Ablin. “Over the last 12 month that figure approached $2 trillion.

The U.S. dollar fell to a 6 month low and has now erased…
continue reading





 
 
 

Zero Hedge

Visualizing The Possible City Of London 'Brexodus'

Courtesy of ZeroHedge. View original post here.

The EU in Brussels has now given official powers to its top Brexit negotiator, but former French diplomat Michel Barnier is not expected to begin talks until after the UK general election in June. As Statista's Dyfed Loesche notes, Banks and financial institutions are already preparing for the world after Brexit and planning to pull some of their staff from the finance hub in the City of London...

...



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Phil's Favorites

Market Moving News

 

Financial Markets and Economy

A definitive breakdown of the gloomy state on Wall Street (Business Insider)

While Wall Street bank revenues appeared to bounce back in the first quarter of 2017, with banks posting strong results in fixed income trading in particular, industry-wide revenues were still down on the same period from 2012 to 2015. 

Vietnam's Prime Minister Says He's Confident of 6.7% Growth Goal (Bloomberg)

Vietnamese Prime Minister Nguyen Xuan Phuc said he is confident economic growth this year will meet a goal of 6.7 percent without adding ...



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ValueWalk

Jesse Livermore - 21 Investing Rules That Have Stood The Test Of Time For 77 Years

By The Acquirer's Multiple. Originally published at ValueWalk.

Before the modern day tweeter @Jesse_Livermore, there was a famous investing legend also called Jesse Livermore. The original Livermore was born in 1877 and died in 1940. Livermore was famous for making and losing several multimillion-dollar fortunes and short selling during the stock market crashes in 1907 and 1929. Livermore was an investing genius who unfortunately could not stick to his own rules – Which is why one of his rules – “The human side of every person is the greatest enemy of the average investor or speculator”, is so relevant to every investor.

]]> Get The Full Ray Dalio Series in PDF

Get the entire 10-part series on Ray Dalio in ...



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Chart School

Friday Kept Week's Performance Intact - Semiconductors Strong

Courtesy of Declan.

Memorial weekend brought with it holiday style trading on Friday. It was positive finish for bulls who were able to maintain and in some cases, build on, gains from earlier in the week

Best of the action came in the Semiconductor Index which finished with a new closing high. The rally from April brought with it an acceleration in pace, comparable to the latter part of 2016.  Relative performance against the Nasdaq 100 hasn't breached resistance, but it's very close. Semiconductors spent a long time in the doldrums after the 2000 peak, but they are finding their groove now.

...

more from Chart School

Digital Currencies

Visualizing The Expanding Universe Of Cryptocurrencies

Courtesy of Zero Hedge

Bitcoin is the original cryptocurrency, and its meteoric rise has made it a mainstay of conversation for investors, media, and technologists alike.

In fact, as Visual Capitalist's Jeff Desjardins details, the innovation of the blockchain is changing entire markets, while causing ripples with central banks and the financial industry. At time of publication, the bitcoin price now hovers near US$2,200, a massive increase from this time last year.

But the true impact of Bitcoin is actually far more reaching than this – it’s a...



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Market News

Market Moving News

 

Financial Markets and Economy

Hedge Fund Billionaire Paul Singer: If Trump Agenda Fails, a Recession Could Follow (Fortune)

Market watchers who thought the stock market would drop if Donald Trump were elected were burned following his win: markets rose to new highs instead.

U.S. inflation path since 2012 is worrisome, policymaker says (Reuters)

The current level of U.S. prices is noticeably lower than what it would be if the Federal Reserve had delivered on its 2-percent inflation target, St. Louis Federal Reserve President James Bullard said, calling the trend "worrisome."

...



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Members' Corner

Robert Sapolsky: The biology of our best and worst selves

Interesting discussion of what affects our behavior. 

Description: "How can humans be so compassionate and altruistic — and also so brutal and violent? To understand why we do what we do, neuroscientist Robert Sapolsky looks at extreme context, examining actions on timescales from seconds to millions of years before they occurred. In this fascinating talk, he shares his cutting edge research into the biology that drives our worst and best behaviors."

Robert Sapolsky: The biology of our best and worst selves

Filmed April 2017 at TED 2017

 

p.s. Roger (on Facebook) saw this talk and recommends the book ...



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OpTrader

Swing trading portfolio - week of May 22nd, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Biotech

Beyond just promise, CRISPR is delivering in the lab today

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Beyond just promise, CRISPR is delivering in the lab today

Courtesy of Ian HaydonUniversity of Washington

Precision editing DNA allows for some amazing applications. Ian Haydon, CC BY-ND

There’s a revolution happening in biology, and its name is CRISPR.

CRISPR (pronounced “crisper”) is a powerful technique for editing DNA. It has received an enormous amount of attention in the scientific and popular press, largely based on the promise of what this powerful gene e...



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Kimble Charting Solutions

Brazil; Waterfall in prices starting? Impact U.S.?

Courtesy of Chris Kimble.

Below looks at the Brazil ETF (EWZ) over the last decade. The rally over the past year has it facing a critical level, from a Power of the Pattern perspective.

CLICK ON CHART TO ENLARGE

EWZ is facing dual resistance at (1), while in a 9-year down trend of lower highs and lower lows. The counter trend rally over the past 17-months has it testing key falling resistance. Did the counter trend reflation rally just end at dual resistance???

If EWZ b...



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Mapping The Market

Bombing - Right or Wrong?

Courtesy of Jean-Luc

I am telling you Angel – makes no sense… BTW:

Republicans Love Bombing, But Only When a Republican Does It

By Kevin Drum, Mother Jones

A few days ago I noted that Republican views of the economy changed dramatically when Donald Trump was elected, but Democratic views stayed pretty stable. Apparently Republicans view the economy through a partisan lens but Democrats don't.

Are there other examples of this? Yes indeed. Jeff Stein points to polling data about air strikes against Syria:

Democr...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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FeedTheBull - Top Stock market and Finance Sites



About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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