Archive for the ‘Chart School’ Category

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

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. 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.

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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.

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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.

April Durable Goods: Another Mixed Bag

Courtesy of Doug Short.

The May Advance Report on April Durable Goods released today by the Census Bureau was another disappointment. Here is the Bureau’s summary on new orders:

New orders for manufactured durable goods in April decreased $1.2 billion or 0.5 percent to $235.5 billion, the U.S. Census Bureau announced today. This decrease, down two of the last three months, followed a 5.1 percent March increase. Excluding transportation, new orders increased 0.5 percent. Excluding defense, new orders increased 0.2 percent.

Transportation equipment, also down two of the last three months, drove the decrease, $ 2.0 billion or 2.5 percent to $77.9 billion.   Download full PDF

The latest new orders headline number at -0.5 percent was slightly below the estimate of -0.4 percent. However, this series is down 2.3 percent year-over-year (YoY). If we exclude transportation, “core” durable goods came in at 0.5 percent month-over-month (MoM), slightly beating the estimate of 0.4 percent. However, the core measure is down -0.9 percent YoY.

If we exclude both transportation and defense for an even more fundamental “core”, the latest number was up 1.6 percent MoM, but up 5.6 percent YoY.

Core Capital Goods New Orders (nondefense capital goods used in the production of goods or services, excluding aircraft) is an important gauge of business spending, often referred to as Core Capex. It posted a 1.0 percent monthly gain but it is down 1.4 percent YoY.

For a look at the big picture and an understanding of the relative size of the major components, here is an area chart of Durable Goods New Orders minus Transportation and Defense with those two components stacked on top. We’ve also included a dotted line to show the relative size of Core Capex.

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The next chart shows year-over-year percent change in Core Durable Goods. We’ve highlighted the value at recession starts and the latest value for this metric.

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The next chart shows the growth in Core Durable Goods overlaid on the headline…
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RTT browsing latest..

Courtesy of Read the Ticker.

rtt-browsing-latestPlease review a collection of WWW browsing results.

Date Found: Thursday, 12 February 2015, 09:05:43 PM

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Comment: GDX: Higher lower, holding above support. Pullback swing on less volume than up swing. RTT: Bullish.

Date Found: Thursday, 07 May 2015, 04:35:23 AM

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Comment: RAISE CASH, before the crowd does!

Date Found: Thursday, 07 May 2015, 06:45:04 PM

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Comment: Richard Wyckoff calls this a CAUSE, at the moment the selling waves during the cause do NOT give an indication of a break out down. Bias is bullish. NOT on HTML! ha

Date Found: Thursday, 07 May 2015, 06:49:11 PM

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Comment: Look away, nothing to see here. BUY APPL, FB, NFLX etc (ha)

Date Found: Thursday, 07 May 2015, 10:57:22 PM

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Comment: Chart In Focus: Correlation says Aug/Sept 2015, some gas out of the balloon!

Date Found: Friday, 08 May 2015, 02:53:05 PM

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Comment: A reminder, juice for the goose!

Date Found: Friday, 08 May 2015, 08:40:57 PM

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Comment: The JAWS of divergence, wont be good if it returns to the mean!

Date Found: Friday, 08 May 2015, 10:08:54 PM

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Comment: This would not happen to you or me, emails removed!

Date Found: Sunday, 10 May 2015, 02:11:12 PM

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Comment: Tow very important components of US GDP, both going in the wrong direction.

Date Found: Sunday, 10 May 2015, 06:56:57 PM

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Comment: MORE MORE money…
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Tight Trading Covered Last Weeks Action

Courtesy of Declan.

Friday didn’t bring a flourish of buying or selling into the long weekend, so it’s up to Tuesday to price in weekend news. Opportunities are available for both bulls and bears.

Bulls will be looking to the S&P to push from 5-day days of tight, sideways pattern in an effort to put some distance to 2120. Technicals are mixed, with a strong ‘buy’ in the MACD and bullish momentum, offset by a ‘sell’ trigger in On-Balance-Volume and some mixed action in the ADX. One point of note is the bullish cross in relative performance against the Russell 2000.

In the bears camp is the Nasdaq. While it has managed to hold 5038 support it has resistance at 5096 to contend with. This may give bears a chance to sneak a quick trade in, looking for a move to retest support of what is increasingly looking like a rising (bearish) wedge. With the exception of the ADX, all supporting technicals are bullish. In addition, the index is outperforming the S&P. Collectively, there may be enough to keep shorts honest, as buyers look to drive past 5096 and on to new highs.

Although bears can also look to the Percentage of Nasdaq Stocks above the 50-day MA as a marker for further weakness. Note the reversal from 54% resistance; the way this is heading it won’t be long until there are fewer than 50% of component Nasdaq stocks above their 50-day MA.

Bears may also be looking at the Russell 2000. There is a potential new bearish channel taking shape with the 50-day MA providing the current support. The channel hasn’t been confirmed (3 touches of resistance are required), but if Tuesday opens weak then shorts will be clustering their stops around 1,261.  Technicals are bullish, but not strongly so.

Shorts may have the easier time of it on Tuesday, but any profit taking which takes hold will probably run into buyers sooner rather than later. The slow drip action of markets is favouring bulls, who have little incentive to sell. It would probably take 3 consecutive big red candles to put bulls in a position where they would feel the need to sell rallies. It’s all very tight at the moment.

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

Memorial Day Offer: Tradercast

Courtesy of Declan.

I have been working with Tradercast for just over 6 months, and do the Friday show from 13:30 GMT to 15:30 GMT (8:30 AM ET to 10:30 AM ET). Tradercast is operated by @PhillipKonchar, and covers Major FX pairs, European and U.S. Indices, precious metals and oil. There is some stock coverage, although the focus is on the aforementioned assets.

To celebrate Memorial weekend, Tradercast is offering a special discount on membership, equivalent to a free month of service on top of the 14-day free trial. When signing up, enter the promo code “fallond_Memorial” to avail of this offer.

Tradercast includes:

  • Full charting with annotations, indicators and templates
  • Heatmap
  • Stocktwits feed integration
  • Custom watchlists
  • Video reports and archived broadcasts
  • Economic Calendar
  • Signals feed
  • Education modules on trading and technical analysis
  • Multi-chart view
  • Community charts
  • Real-time community chat and one-to-one messaging

A sample broadcast of mine is available after the jump