Archive for the ‘Chart School’ Category

STTG Market Recap May 29, 2015

Courtesy of Blain.

It was quite a volatile week and indexes closed it off on a sour note as the S&P 500 fell 0.63% and NASDAQ 0.55%.  For the month of May the S&P 500 gained 1.05% while the NASDAQ added 2.6%.   Greece was again the focus – perhaps next week some eyes will return to economic data as the first week of the month is chock full of reports.   Consumer sentiment showed a final read of 90.7 for May, the lowest since November and below April’s 95.9 print.  A gauge today showed Chicago-area manufacturing activity contracted this month to its lowest level since February, raising concerns that the rebound from a weak first quarter lacks vitality.

Tuesday’s selloff led to a bull flag failure and despite the immediate bounce back Wednesday, this failure has stayed intact.

spx

nasdaq

The NYSE McClellan Oscillator has remained in the red this week and gives us a secondary reason to stay in a cautionary mode.

NYMO

Transports have been flashing negative in a divergent manner for quite a while now.

tran

Emerging markets (ETF: EEM) have also been selling off behind the scenes.

eem

European stocks were hit as the continued daily circus with Greece continues.

dax

Shares of health insurer Humana (HUM) surged amid reports the company had received takeover interest from potential buyers.

hum

Big Lots (BIG) reported quarterly profit of 60 cents per share, one cent above estimates, with revenue in line with forecasts. However, the discount retailer’s current quarter earnings forecast is below estimates, with comparable store sales expected to grow by two to three percent.

big

Eli Lilly (LLY) surged as it decided  to partner with AstraZeneca (AZN) to test a new cancer drug combination.

lly

Have a good early summer weekend and we’ll see you back here Monday.





NYSE margin divergence to price

Courtesy of Read the Ticker.

nyse-margin-divergence-to-priceThe April 2015 NYSE margin level is a concern, not for its level, but its effect on NYSE prices it looks like its broken.

The last 3 months has seen a handsome increase in NYSE Margin but yet prices have not moved an equal amount. This new buying power is been met with equal selling power. This is simple distribution, or more likely the informed selling to the uniformed. Or the smart money selling to the dumb money, those that are last to this party. This is also another reason why the NYSE Summation Index has struggled to get past the +500 level as per previous post.

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NYSE



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…

..”TIME is the most important factor in determining market movements and by studying the past records of the averages or individual stocks you will be able to prove for yourself that history does repeat and that by knowing the past you can tell the future. ? There is a definite relation between TIME and PRICE. ? Now, by a study of the TIME PERIODS and TIME CYCLES you will learn why tops and bottoms are found at certain times and why Resistance Levels are so strong at certain times and bottoms and tops hold around them. ? The most money is made when fast moves and extreme fluctuations occur at the end of major cycles.” ..

William D Gann


..”The first rule is not to lose. The second rule is not to forget the first rule”

Warren Buffett








STTG Market Recap May 28, 2015

Courtesy of Blain.

After 2 volatile days, a return to more calm on Thursday as the S&P 500 fell 0.13% and the NASDAQ 0.17%.  The daily Greek drama continues; IMF Managing Director Christine Lagare told a German newspaper that a Greek exit from the euro zone was possible but that this would probably not herald the end of the euro currency.  On Wednesday, both U.S. and European equities rallied after Greece said it had stated crafting a “staff level agreement” with its international bailout supervisors. However, European officials rebuked the claims on Thursday, saying there was some way to go before any agreement could be drawn up and that they were surprised by the upbeat sentiment from Greece.

Indexes look much the same as we entered the week.

spx

nasdaq

Despite Wednesday’s rally, the NYSE McClellan Oscillator remains in the red; bulls would like to see this change.

NYMO

China stocks plunging 6.5 percent on Thursday, with traders citing the tightening of marginal lending rules as an explanation.  The chart had become parabolic…

ssec

Costco (COST) reported quarterly earnings of $1.17 per share, two cents above estimates, though revenue and comparable store sales were below forecasts. The warehouse retailer was hurt by lower gasoline prices and a stronger dollar.

cost

Abercrombie (ANF) lost 53 cents per share for its latest quarter, wider than the 34 cent consensus estimate. Revenue missed forecasts amid an eight percent drop in comparable store sales. The apparel retailer did say it sees sales improving, and that it will see continued headwinds from foreign currency fluctuations.   Its teen-focused Hollister chain showed signs of improvement, a relative bright spot for a company struggling to make a comeback.

anf

GoPro (GPRO) rose to a four-month high after the maker of action cameras announced plans to develop drone and virtual-reality businesses.  It tagged its newly created 200 day moving average.

gpro





Markets Recover Losses

Courtesy of Declan.

Today’s late recovery returned initiative to bulls. The Nasdaq finely placed to challenge new highs, helped by the major breakout in the Semiconductor Index; an important economic barometer.



Unfortunately another economic bellwether, the Russell 2000, is not quite there but could push beyond its declining channel should gains continue elsewhere.


The S&P is nicely placed to have a good Friday, holding above the critical 2120 level which has offered stiff resistance in the past.


While indices are ready to challenge highs, breadth metrics do offer a note of caution. Nasdaq breadth metrics have been in decline since peaking in 2013/14, creating a bearish divergence to the parent index, leaving markets vulnerable to another 2011 style sell off.


For tomorrow, a strong finish would set a positive tone heading into the weekend. But first steps first, new highs are required to build bullish confidence.

You’ve now read my opinion, next read Douglas’ and Jani’s.





STTG Market Recap May 27, 2015

Courtesy of Blain.

Wednesday’s action was almost a 180 degree turn from Tuesday’s with the S&P 500 up 0.92% and the NASDAQ 1.47%.  Sone vague belief in (yet another) resolution in Greece seemed to be the catalyst.   Greek Prime Minister Alexis Tsipras said on Wednesday the negotiations are on the “final stretch” towards a positive deal, Reuters reported.   Later in the day, German Finance Minister Wolfgang Schaeuble said there was not much progress in the Greek debt talks and he was surprised by the upbeat tone from some Greek government officials.  Athens must make a 300 million euro payment to the International Monetary Fund on June 5, ahead of several other payments due to the IMF later in the month, for a total of 1.6 billion euros.

We’ll see if yesterday’s move was the head fake or today’s was shortly.

spx

nasdaq

As with almost every rally in the NASDAQ nowadays, it begins and ends with Apple (AAPL) and the biotech stocks (ETF: IBB).   With both up 2% you have a large % of the NASDAQ index sharply up.

aapl

ibb

Semiconductors (ETF: SMH) also surged.

smh

Chip company Broadcom (BRCM) jumped nearly 22 percent for its best day since April 10, 2001, after Dow Jones reported the chip company was in talks to be bought by peer Avago Technologies.

brcm

Michael Kors (KORS) fell one cent shy of estimates with quarterly profit of 90 cents per share, with revenue essentially in line. The company, however, reported its slowest sales growth in 3-1/2 years, and its full-year forecast was below Street estimates.  This was an ugly chart before today’s news – and it just got a whole lot uglier.

kors

Toll Brothers (TOL) earned 37 cents per share for its latest quarter, two cents above estimates. The luxury home builder did see revenue come in below estimates as the number of homes sold fell two percent.

tol





STTG Market Recap May 26, 2015

Courtesy of Blain.

Last week we remarked how the S&P 500 finally had broken out of a multi month range… but then it did little.  Usually once a stock/ETF moves out of a long range it has a pronounced move; but the S&P 500 didn’t – it barely budged.  Today that move collapsed.  The S&P 500 fell 1.03% and the NASDAQ 1.11%.   Most pointed to some vague increase in a chance of a rate hike but this is too much tea leaving – the Federal Reserve has said everything is data dependent.

U.S. Federal Reserve Vice Chairman Stanley Fischer said Tuesday that markets should not be surprised by the timing or pace of rate hikes.

In economic news, durable goods for April showed a decline of 0.5 percent, roughly in-line with expectations. Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, rose 1.0 percent last month after an upwardly revised 1.5 percent increase in March.  New home sales for April showed an increase of 6.8 percent to a seasonally adjusted annual rate of 517,000, up from the consensus 510,000.

You can see the failure in the S&P 500 below as the NASDAQ returned to a key moving average as well.

spx

nasdaq

And just like that the NYSE McClellan Oscillator went from a positive range to well into the negatives.

NYMO

We noted the transports sticking out like a sore thumb last week to the downside – this continued.

tran

AutoZone (AZO) said quarterly gross profit was 52.3 percent, a slight uptik from 52.0 percent for the same period last year. Same-store sales increased 2.3 percent for the quarter.

azo

A rotten day for Apple (AAPL) now means a rotten day for the NASDAQ and NYSE as it is a major component of both.

aapl

Here are some additional charts via Marketsmith:

Charter Communications said it would purchase Time Warner Cable for $55 billion, valuing each share around $195.71. The deal merges the second and third largest U.S. cable companies and creates a greater rival for Comcast Corp.

twc

chtr

Here is a chart of an ETF for the dollar:

uup





Best Trader on eToro?

Courtesy of Declan.

Going by their current +eToro  Trending Investors, there is a familiar avatar at the top:



While U.S. Investors can’t copy me, my posts can be followed here.





Profit Taking Sweeps Into Town

Courtesy of Declan.

After days of tight trading, bulls decided to take money off the table following a slew of economic data. The S&P finished at rising support after tagging the 50-day MA. Today’s selling hasn’t totally reversed the rally, but another day like today would seed enough doubts in bulls to restrict dip buying.


The Nasdaq looks to be double topping around 5,100. It finished at its 20-day MA, but has room to maneuver down to rising support. Unlike the S&P, the Nasdaq could survive another day of selling.


The Russell 2000 is shaping a downward channel, finishing the day on its 50-day MA. Small Caps have struggled since April and given relative (under-)performance to Large Caps and Tech, looks ready to continue lower. Technicals are a little mixed, especially with the -DI leading +DI and the MACD ready to trigger a strong ‘sell’.


For tomorrow, bulls will be looking to the S&P for a bounce. If buyer don’t make a stand in the first hour of the cash market opening, then the Russell 2000 and Nasdaq could experience the brunt of the disappointment.

You’ve now read my opinion, next read Douglas’ and Jani’s.





Handsome gains in NYSE index may be over

Courtesy of Read the Ticker.

handsome-gains-in-nyse-index-may-be-overThe NYSE Summation index (Ratio Adjusted) is a very good measure of the performance of advancing and declining issues within the NYSE index.

It takes new money or true liquidity to have more advancing stocks than declining stocks, if the new money flow into the stock market slows or stops then NYSE Summation Index (ratio Adjusted) struggles to get over +500 or falls. If this happens over a longer period then this evidence that a stock market top is likely. Sure you may get the NYSE index moving up and down within a 10% range, buy the days of 30% gains are very unlikely while the NYSE Summation Index (Ratio Adj) struggles at +500.

This quote is appropriate:

Bernard Baruch..“Don’t try to buy at the bottom and sell at the top. It can’t be done except by liars.”..

The above quote means, if you have green on the screen, green becomes cash at times like these.

The chart below shows the NYSE Summation index (ratio adj) performance at the two previous market tops. History is repeating. Time to keep and eye on this index.

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NYSE




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…

..”Without specific, clear, and tested rules, speculators do not have any real chance of success”..

Jesse Livermore


..“If it’s obvious, it’s obviously wrong.”..

Joe Granville








Richmond Fed: Manufacturing Flattened in May

Courtesy of Doug Short.

Today the Richmond Fed Manufacturing Composite Index squeaked back above the flatline with a 4 point increase to 1 from last month’s -3. Investing.com had forecast a rise to 0. Because of the highly volatile nature of this index, we include a 3-month moving average to facilitate the identification of trends, now at -3.3, in modest contraction.

The complete data series behind today’s Richmond Fed manufacturing report (available here), which dates from November 1993. Here is a snapshot of the complete Richmond Fed Manufacturing Composite series.

Click to View
Click for a larger image

Here is the latest Richmond Fed manufacturing overview.

new orders leveled off, while the backlog of orders declined further compared to last month. Hiring edged up, while the average workweek increased slightly. However, average wage growth accelerated this month.

Despite the soft conditions this month, manufacturers continued to look for improved business conditions in the next six months. Expectations were for solid growth in shipments and in the volume of new orders in the six months ahead. In addition, survey participants looked for increased capacity utilization and expected order backlogs to grow more quickly. However, producers looked for little change in vendor lead times.

Manufacturers’ outlook for the months ahead included faster growth in the number of employees and average wages than in the current month. In addition, they expected modest growth in the length of the average workweek.

Here is a somewhat closer look at the index since the turn of the century.

Click to View
Click for a larger image

Is today’s Richmond composite a clue of what to expect in the next PMI composite? We’ll find out when the next Manufacturing ISM Report on Business is released on June 1st.

Because of the high volatility of this series, we should take the data for any individual month with the proverbial grain of salt.





 
 
 

Zero Hedge

Creator Of Infamous "Hope" Poster Lashes Out At Obama, Calls Americans "Ignorant And Lazy"

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Before the people realized that behind the "most transparent administration ever" there was nothing but double seasonal adjustments, drones and an impenetrable layer of propaganda and lies, there was...

And change, of course.

Sadly, at some point over the past six years the hope died, first for the people (if not the bankers), and then for the creator of the infamous "Hope" poster himself, Shepard Fairey who told ...



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Phil's Favorites

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Putting Economic Models in Their Place (Brad DeLong, Project Syndicate)

When policymakers turn to economists for guidance, they expect the advice they receive to be grounded in science, not academic factionalism or political presuppositions. After all, the policies they will be putting in place will have real implications for real people. Unfortunately, however, sound science is not always the driving force behind economic analysis and policy recommendations.

In a recent critique of what he calls the “mathiness” of modern economics, Paul M. Romer of...



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Chart School

STTG Market Recap May 29, 2015

Courtesy of Blain.

It was quite a volatile week and indexes closed it off on a sour note as the S&P 500 fell 0.63% and NASDAQ 0.55%.  For the month of May the S&P 500 gained 1.05% while the NASDAQ added 2.6%.   Greece was again the focus – perhaps next week some eyes will return to economic data as the first week of the month is chock full of reports.   Consumer sentiment showed a final read of 90.7 for May, the lowest since November and below April’s 95.9 print.  A gauge today showed Chicago-area manufacturing activity contracted this month to its lowest level since February, raising concerns that the rebound from a weak first quarter lacks vitality.

Tuesday’s selloff led to a bull flag failure and despite the immediate bounce back Wednesday, this failure has stayed intact.

...



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All About Trends

Mid-Day Update

Reminder: David 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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Kimble Charting Solutions

S&P 500 – Is it repeating the 2000 & 2007 topping pattern?

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

Could the S&P 500 be pulling a repeat of the 2000-2007 topping process?

The chart above reflects that the tops in 2000 & 2007 were 7 years and 7 months apart. Is it possible that another top is taking place 7 years and 7 months from the 2007 high? As the S&P is facing this potential time window repeating pattern, it is also staring the Fibonacci 161% Extension resistance level based upon the 2007 highs and 2009 lows, at the top of a rising wedge.

Is the S&P the only market facing a breakout test? The chart below takes a look at the white hot DAX index.

...



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Sabrient

Sector Detector: Stocks provide a tepid breakout as Fed greases the skids. So now what?

Courtesy of Sabrient Systems and Gradient Analytics

Early last week, stocks broke out, with the S&P 500 setting a new high with blue skies overhead. But then the market basically flat-lined for the rest of the week as bulls just couldn’t gather the fuel and conviction to take prices higher. In fact, the technical picture now has turned a bit defensive, at least for the short term, thus joining what has been a neutral-to-defensive tilt to our fundamentals-based Outlook rankings.

In this weekly update, I give my view of the current market environment, offer a technical analysis of the S&P 500 chart, review our weekly fundamentals-based SectorCast rankings of the ten U.S. business sectors, and then offer up some actionable trading ideas, including a sector rotation strategy using ETFs and an enhanced version using top-ranked stocks from the t...



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OpTrader

Swing trading portfolio - week of May 24th, 2015

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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Pharmboy

Big Pharma's Business Model is Changing

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

Understanding the new normal of a business model is key to the success of any company.  The managment of companies need to adapt to the changing demand, but first they must recognize what changes are taking place.  Big Pharma's business model is changing rapidly, and much like the airline industry, there will be but a handful of pharma companies left at the end of this path.

Most Big Pharma companies have traditionally done everything from research and development (R&D) through to commercialisation themselves. Research was proprietary, and diseases were cherry picked on the back of academic research that was done using NIH grants.  This was in the heyday of research, where multiple companies had drugs for the same target (Mevocor, Zocor, Crestor, Lipitor), and could reap the rewards on multiple scales.  However, in the c...



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Digital Currencies

Nasdaq's bitcoin plan will provide a real test of bitcoin hype

 

Nasdaq's bitcoin plan will provide a real test of bitcoin hype

By 

Excerpt:

Bitcoin, the virtual digital currency, has been called the future of banking, a dangerous fad, and almost everything in between, but we're finally about to get some solid data to help settle the debate.

On Monday, the Nasdaq (NDAQ) stock exchange said it would ...



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Market Shadows

Kimble Charts: US Dollar

Which way from here?

Chris Kimble likes the idea of shorting the US dollar if it bounces higher. Phil's likes the dollar better long here. These views are not inconsistent, actually, the dollar could bounce and drop again. We'll be watching. 

 

Phil writes:  If the Fed begins to tighten OR if Greece defaults OR if China begins to fall apart OR if Japan begins to unwind, then the Dollar could move 10% higher.  Without any of those things happening – you still have the Fed pursuing a relatively stronger currency policy than the rest of the G8.  So, if anything, I think the pressure should be up, not down.  

 

UNLESS that 95 line does ultimately fail (as opposed to this being bullish consolidation at the prior breakout point), then I'd prefer to sell the UUP Jan $25 puts for $0.85 and buy the Sept $24 call...



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Mapping The Market

An update on oil proxies

Courtesy of Jean-Luc Saillard

Back in December, I wrote a post on my blog where I compared the performances of various ETFs related to the oil industry. I was looking for the best possible proxy to match the moves of oil prices if you didn't want to play with futures. At the time, I concluded that for medium term trades, USO and the leveraged ETFs UCO and SCO were the most promising. Longer term, broader ETFs like OIH and XLE might make better investment if oil prices do recover to more profitable prices since ETF linked to futures like USO, UCO and SCO do suffer from decay. It also seemed that DIG and DUG could be promising if OIH could recover as it should with the price of oil, but that they don't make a good proxy for the price of oil itself. 

Since...



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Promotions

Watch the Phil Davis Special on Money Talk on BNN TV!

Kim Parlee interviews Phil on Money Talk. Be sure to watch the replays if you missed the show live on Wednesday night (it was recorded on Monday). As usual, Phil provides an excellent program packed with macro analysis, important lessons and trading ideas. ~ Ilene

 

The replay is now available on BNN's website. For the three part series, click on the links below. 

Part 1 is here (discussing the macro outlook for the markets) Part 2 is here. (discussing our main trading strategies) Part 3 is here. (reviewing our pick of th...

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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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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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