Author Archive for Chart School

Nasdaq 100 Breakout with Dow Jones at Resistance

Courtesy of Declan.

Since my last update markets continued to edge higher. As of Wednesday’s close the Nasdaq 100 was the latest index to break to new all-time highs. Relative performance for the Nasdaq 100 edged a little ahead of the Russell 2000.






The S&P broke from its handle and has managed to put a bit of distance from the congestion zone. Next resistance is at 2,800 but I would look for a test of all-time highs in line with Tech and Small Cap indices.





The Nasdaq negated the March ‘bull trap’ with a new all-time highs (supported by a breakout in On-Balance-Volume).





The Dow Jones Index made it up to channel resistance. Other indices do not immediately suggest a reversal is on the cards but this index does offer shorts something to work with (if not a very convincing call).





The Russell 2000 continued its run of good form. Those who traded the breakout have yet to be given an exit signal but near-term traders could look to take some profits.





For tomorrow, bulls can look for a continuation in the run in good form; even if sellers reappear it will take a significant reversal to break the uptrend.  Taking partial profits will help keep you in the green if your holding period is a couple of weeks or less.  Long-term investors have little reason to sell at this stage. Aggressive shorts could try the Dow Jones Industrial Average but cover on a break of channel resistance.




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.









Weekly Market Recap Jun 3, 2018

Courtesy of Blain.

After 2 weeks of low volatility, that variable was introduced back into the holiday shortened week!  Another change from 2017 when almost every week was a low volatility week.   That said, small caps (Russell 2000) and tech stocks held in quite well and we don’t have any major technical change in the indexes – more on that later.

“Political drama in Italy” was what caused some ruckus Tuesday when traders returned from the long break.

“Today’s selling is happening on a larger volume, which is concerning. It means that investors are now worried about contagion from the fallout in Italy,” said Joe Saluzzi, partner and co-head of equity trading at Themis Trading.

And then Wednesday it was “not so much” as indexes rebounded.  With a “gap up” pre market. (A coalition government was formed later in the week).

“The fact that the market is shrugging off Italy’s political drama suggests that maybe it was a crowded trade that was being unwound and not something more serious,” said Michael Antonelli, equity sales trader at Robert W. Baird & Co.

Ah, she is a mercurial beast.

Thursday, TRADER WARS!! ™ were back on the forefront as the U.S. decided to impose tariffs on steel and aluminum imports from the European Union, Canada and Mexico.  Canadian Prime Minister Justin Trudeau said Ottawa would impose a 25% tariff on steel imports from the U.S., a 10% tariff on aluminum and other U.S. goods.

Friday, a Trump tweet about the employment data led to a “gap up”.

For the week the S&P 500 closed up 0.5% while the NASDAQ added 1.6%.  Second straight week of big outperformance by the NASDAQ.

Wednesday, the first revision of Q1 gross domestic product  showed the U.S. economy grew a touch softer than originally reported, mainly because of a slower buildup in inventories. GDP was trimmed to an annual 2.2% pace from 2.3%.  The Federal Reserve said in it’s “beige book” that the U.S. grew “moderately” from late April to…
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Fresh Breakouts for Technology Indices

Courtesy of Declan.

Thursday’s selling, despite the heavier volume, couldn’t undo the underlying demand kick-started by Wednesday’s Russell 2000 breakout.




The cleanest breakout was in the Semiconductor Index. It finished inside the zone defined by the March ‘bull trap’. A push to next resistance at 1,465 looks a reasonable target from here.






The Nasdaq 100 also pushed into its March ‘bull trap’ with an upside target of 7,185.





The Nasdaq was also in on the game as it pushed into its ‘bull trap’; it’s upside target is 7,635.





While the Russell 2000 wasn’t the center of attention on Friday it did manage to recover all of the ground it lost on Thursday. Momentum players will again be looking to push on to new all-time highs.





The S&P didn’t do a whole lot on Friday but relative performance took another step lower. The index is shaping a good handle despite technical weakness; value buyers could wait for the handle to clear but buyers of the ‘bear trap’ will be sitting pretty and should have stops at breakeven.





For Monday, buyers have a choice of indices to work with some wiggle room should sellers make a reappearance. At the very least I would be looking for a challenge of ‘bull trap’ highs from indices exhibiting this pattern.




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.









Sellers Challenge Breakouts But Markets Hold On

Courtesy of Declan.

Trump’s tariffs sent markets on a bit of a spin but total selling, while ranked as distribution, didn’t go above 1%. More importantly. the bullish setups from yesterday remain valid.




Loses in the S&P took the index back to challenging the ‘bear trap’. An open around 2,700 could offer a discounted long opportunity.






The Nasdaq finished with a small ‘inverse hammer’ just above the breakout level.





Small Caps gave up a large chunk of yesterday’s follow-through move but not enough to negate it.  Technicals remain net bullish.





The only index where further losses might be favoured is the Dow Jones Industrial Average. Today’s losses may have pushed a little too hard for a recovery tomorrow; a move to rising channel support looks a better play.





Finally, the Semiconductor Index – despite not having a great day yesterday – still maintains its breakout.





For tomorrow, those favouring continued weakness can focus on the Dow Jones. Longs could go aggressive on the S&P or look for the Russell 2000 to recover its lost ground today.




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.









The Power of Momentum (for Wyckoff)

Courtesy of Read the Ticker.

the-power-of-momentum-for-wyckoffMomentum is important, very important, and any player in the market must have a method to judge its performance.



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Sure fundamentals do matter, and so does market timing (entry, stops and exit), here at readtheticker.com we believe a combination of Gann Angles, Cycles and Wyckoff Logic is the best way to secure better timing than most, after all these methods have been used successfully for 70+ years. With our website you can chart any security in the world.



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…



..”Thus, I affirm, every class of phenomena, whether in nature or in the stock market, must be subject to the universal law of causation and harmony. Every effect must have an adequate cause.”..



William D Gann





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





..”Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected”..



George Soros





…“To me, the ‘tape’ is the final arbiter of any investment decision. I have a cardinal rule: Never fight the tape!”…



Martin Zweig





..“Successful speculation requires staying on top of changes in industries and companies that either create new industries or improve on existing industries. The majority of your profits will come from these two … The shrewdest traders throughout history all adapted the skill of reactionary change, as the market constantly presents new and different opportunities.”..



Bernard Baruch











Small Caps Follow Through; ‘Bear Trap’ in S&P

Courtesy of Declan

Yesterday had opened up bearish opportunities in Large Cap Indices but it was the Russell 2000 which ultimately delivered in favour of bulls.

The Russell 2000 followed yesterday's successful test of support with a 1.5% gain today. With no overhead resistance and net bullish technicals there isn't any clear point of weakness.
 


Another index to take advantage of the buying was the Nasdaq. The breakout was relatively minor and it still has to challenge the 'bull trap' but the index cleared the 3-week handle consolidation.  Volume climbed to register accumulation with a fresh On-Balance-Volume 'buy' trigger to return technicals to a net bullish state.
 


The switch trade belongs to the S&P; yesterday's consolidation breakdown would have encouraged new short trades but these would have been whipped out today. Aggressive traders could go the other way and trade long off the now new 'bear trap'; stops on loss of 2,700 with upside targets of 2,800 and 2,875.  Unlike the Nasdaq, buying volume was light and technicals are still predominantly bearish.

 


Dow Theorists will be enjoying the acceleration in the ratio between the Transports Index and the Dow Industrials. This is the second breakout this year with a new near-term high.
 


For tomorrow, the Russell 2000 has been the consistent player for bulls. Aggressive traders can look to buy the 'bear trap' in the S&P – although given some may have shorted yesterday (and have been forced to cover) they may be reluctant to switch.

 





Large Caps Signal Trouble

Courtesy of Declan

There was a shot across the bows from Large Cap indices as the consolidations which were playing out the last few weeks took a step south. 

For the S&P this amounted to a clear breakdown and the risk is further losses to take things back inside the 2,575-2,675 range; however, if this does occur I would look for further losses as the momentum which drove the initial advance fades. Not surprisingly, today's breakdown also came with technical 'sell' triggers for MACD, On-Balance-Volume and +DI/-DI.
 


The Dow Jones Industrial Average fared little better. The breakout from the pennant has shifted to a breakdown. I have re-graded the action from April as a minor rising channel and would look to the lower channel line as a chance for buyers to have another go at shaping a swing low. As with the S&P, there were 'sell' triggers for the MACD, On-Balance-Volume and ADX.
 


The Nasdaq remained range bound and was relatively immune to the selling of Large Caps. Volume climbed to register as distribution with just a 'sell' trigger in On-Balance-Volume.
 


The Nasdaq 100 lost some ground but still has a breakout from the bullish flag to protect.  For now, the breakout is intact.
 


Another index holding on to its breakout is the Russell 2000. Despite the selling in the S&P and Dow Jones Industrial Average it was still able to recover the intraday's losses by the close. Bulls will be funneled into this index as other opportunities fade.
 


For tomorrow, shorts will be looking to attack any advance in the S&P and Dow. Bulls can focus on the Russell 2000 unless there is a loss of 1,610.
 





Weekly Market Recap May 27, 2018

Courtesy of Blain.

The second week in a row of low volatility which is usually advantage bulls.  Monday saw a nice spike up for indexes and then the other four days of the week the range was very narrow.  Monday’s rally was due to the lessening chance of TRADE WARS!!(tm):

Treasury Secretary Steven Mnuchin said over the weekend that the Trump administration would delay implementation of tariffs on Chinese goods and “put the trade war on hold” while working out details of a deal between the countries.  At the end of trade negotiations that weekend, China agreed to buy larger amounts of U.S. goods to help narrow the trade deficit between the two economies, but didn’t agree to the specific U.S. target of $200 billion.

News was generally quiet but we did get the Fed minutes late Wednesday which were considered market positive.

Federal Reserve officials in their meeting in early May confirmed they planned to raise interest rates in June and were not concerned they were behind the curve on inflation.

“Most participants judged that if incoming information broadly confirmed their economic outlook, it would likely soon be appropriate for the FOMC to take another step in removing policy accommodation,” the minutes said

Although inflation hit the Fed’s 2% target in the latest reading for March, for the first time in a year, officials were not convinced it would remain there for long.

“It was noted that it was premature to conclude that inflation would remain at levels around 2%, especially after several years in which inflation had persistently run below the Fed’s 2% objective,” the minutes said. Only a “few” officials thought inflation might move “slightly” above the 2% target.

For the week the S&P 500 closed up 0.3% while the NASDAQ added 1.1%.

Outside of some housing reports, economic news was sparse.

Treasury yields dropped back down the 2.9% range this past week after popping to 3.1% the week before.

The dollar chart continues to strengthen.

After FIVE+ weeks of…
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Base Building Continues

Courtesy of Declan.

Another Day inside the trading range, another day of waiting. Not a whole lot to say about Friday. The S&P remained tightly bound and confined to a narrow horizontal range. On-Balance-Volume switched to a ‘sell trigger’ as other technicals remained positive. The preferred trade is still an upside breakout from the hande.






The Nasdaq almost delivered a handle ‘breakout’ but wasn’t able to put some distance from the handle. Any additional upside should be enough to deliver the breakout. Unlike other the S&P, supporting technicals are all positive.





Contributing to Nasdaq strength is the near 1% gain in the Semiconductor Index. It’s close to challenging the ‘bull trap’ as it delivered the handle breakout the Nasdaq was so close to creating.







The Russell 2000 is still protecting its breakout and is the index best placed to reward momentum traders. Look for further upside.





The Dow Industrial Average is also working a minor breakout of its own. This is a better value play as it looks to shape a right-hand-side base up to January’s highs.







The relationship to the Transports also looks positive with a fresh breakout in the ratio; buy the strength.





For tomorrow, continue to look for bullish handle breakouts from indices which have yet to deliver.




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.









Second Day of Bullish Defense

Courtesy of Declan.

The market had initially reacted to Trump’s decision to cancel his North Korean summit before coming to its senses and finishing where it left off yesterday.




For the Russell 2000 it was a bullish doji to follow the ‘hammer’; those brave enough to buy the morning dip will be feeling confident as technicals remain bullish.






The S&P remains range bound but the longer this tight consolidation continues the stronger the reaction when it does eventually break (up or down).





 It was a similar story for the Nasdaq; range bound but looking more likely to break upside.





The Dow Jones posted a bullish hammer which kept the gap based on the open-close range. Relative performance edges towards bears but price action runs in bulls favour.





The Nasdaq 100 ranks as a breakout within a narrow rising channel. Look for a challenge on 7,186 as the index looks to shape a new base. Technicals are a little flat but still favour bulls.





The watch for tomorrow is the same as it was yesterday. Bears will need a confirmed break of the trading range to suggest shorts have a chance; aggressive shorts could play it here with a cover on a confirmed breakdown but the likelihood is for a quick cover.  the less risky option is to prepare for continuation of the breakout. 




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.









 
 
 

Zero Hedge

Michael Bloomberg Spending $80 Million To Flip House To Democrats

Courtesy of ZeroHedge. View original post here.

With the Democratic Party in shambles and the DNC somehow always broke and demanding refunds from Hillary Clinton, Michael Bloomberg plans to peel off $80 million of his estimat...



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Phil's Favorites

Breaking up families? America looks like a Dickens novel

 

Breaking up families? America looks like a Dickens novel

Almost 1,500 immigrant boys, aged 10 to 17, were separated from their parents and brought to stay at Casa Padre in Brownsville, Texas. Department of Health and Human Services

Courtesy of Sarah Bilston, Trinity College

The news has been full these past few weeks of disturbing stories from the nation’s borders. The T...



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Chart School

Small Caps Add To Gains

Courtesy of Declan.

Good news for momentum traders as the Russell 2000 continued its good run. The Russell 200 will start to get hot when it gets into the 15% profit take zone at 1,732 - a zone last seen tested in December 2016; if we are looking at February 2011 levels (the 5% historic zone) then the Russell 2000 would be tagging 1,813. Start taking profits, or sell covered calls, when we get into these levels.


The S&P reversed off resistance in early June and hasn't yet mounted a challenge to break it - today's gain off its 20-day M...

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Insider Scoop

Munster: Even If China Levies Taxes On iPhones, Your Cost Will Likely Stay The Same

Courtesy of Benzinga.

Related AAPL Selling Pressure Seems Ready To Ebb A Bit, But Trade Fears Haven't Vanished Citi: F5 Networks S...

http://www.insidercow.com/ more from Insider

Digital Currencies

BIS Blasts Cryptos In Special Report: "Beyond The Hype"

Courtesy of Mike Shedlock, MishTalk

The BIS blasts cryptos over scaling issues, energy, and trust. The BIS is correct. Cryptos are fatally flawed as money.

A Bank of International Settlements (BIS) report examines cryptocurrencies in depth. The study, called "Looking Beyond the Hype" investigates whether cryptocurrencies could play any role as money.

Bloomberg, Reuters, and the Bitcoin Exchange guide all have articles on the report but not one of the bothered to link to it.

After a bit of digging, I found the crypto report is part of an upcoming BIS annual report. The BIS pre-released the crypto report today (as chapter 5).

Here's a l...



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Biotech

Mind molding psychedelic drugs could treat depression, and other mental illnesses

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

 

Mind molding psychedelic drugs could treat depression, and other mental illnesses

By agsandrew/shutterstock.com

Courtesy of David E. Olson, University of California, Davis

It seems that psychedelics do more than simply alter perception. According to the latest research from my colleagues and me, they change the structures of neurons th...



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ValueWalk

Buffett At His Best

By csinvesting. Originally published at ValueWalk.

Bear with me as I share a bit of my history that helped me create SkyVu and the Battle Bears games. The University of Nebraska gave me my first job after college. I mostly pushed TV carts around, edited videos for professors or the occasional speaker event. One day, Warren Buffet came to campus to speak to the College of Business. I didn’t think much of this speech at the time but I saved it for some reason. 15 years later, as a founder of my own company, I watch and listen to this particular speech every year to remind myself of the fundamentals and values Mr. Buffett looks for. He’s addressing business students at his alma mater, so I think his style here is a bit more ‘close to home’ than in his other speeches. Hopefully many of you find great value in this video like I have. Sorry for the VHS...



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Kimble Charting Solutions

The Stock Bull Market Stops Here!

 

The Stock Bull Market Stops Here!

Courtesy of Kimble Charting

 

The definition of a bull market or bull trends widely vary. One of the more common criteria for bull markets is determined by the asset being above or below its 200 day moving average.

In my humble opinion, each index above remains in a bull trend, as triple support (200-day moving averages, 2-year rising support lines, and February lows) are still in play ...



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Members' Corner

Cambridge Analytica and the 2016 Election: What you need to know (updated)

 

"If you want to fundamentally reshape society, you first have to break it." ~ Christopher Wylie

[Interview: Cambridge Analytica whistleblower: 'We spent $1m harvesting millions of Facebook profiles' – video]

"You’ve probably heard by now that Cambridge Analytica, which is backed by the borderline-psychotic Mercer family and was formerly chaired by Steve Bannon, had a decisive role in manipulating voters on a one-by-one basis – using their own personal data to push them toward voting ...



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Mapping The Market

The tricks propagandists use to beat science

Via Jean-Luc

How propagandist beat science – they did it for the tobacco industry and now it's in favor of the energy companies:

The tricks propagandists use to beat science

The original tobacco strategy involved several lines of attack. One of these was to fund research that supported the industry and then publish only the results that fit the required narrative. “For instance, in 1954 the TIRC distributed a pamphlet entitled ‘A Scientific Perspective on the Cigarette Controversy’ to nearly 200,000 doctors, journalists, and policy-makers, in which they emphasized favorable research and questioned results supporting the contrary view,” say Weatherall and co, who call this approach biased production.

A second approach promoted independent research that happened to support ...



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OpTrader

Swing trading portfolio - week of September 11th, 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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Promotions

NewsWare: Watch Today's Webinar!

 

We have a great guest at today's webinar!

Bill Olsen from NewsWare will be giving us a fun and lively demonstration of the advantages that real-time news provides. NewsWare is a market intelligence tool for news. In today's data driven markets, it is truly beneficial to have a tool that delivers access to the professional sources where you can obtain the facts in real time.

Join our webinar, free, it's open to all. 

Just click here at 1 pm est and join in!

[For more information on NewsWare, click here. For a list of prices: NewsWar...



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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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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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About Ilene:

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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