Archive for the ‘Chart School’ Category

China’s big decline providing a sweet entry point?

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

While the S&P 500 and many indices in the states are trading near all-time highs, the same thing can’t be said for stocks in China! Since the highs in February, the Shanghai Index (SSE) has declined nearly 25%.

Could this large percentage decline be presenting an opportunity/entry point for aggressive bargain hunters? Yes!

The decline has the SSE index testing the bottom of its 3-year trading range and 5-year rising support at (1), while momentum is now the lowest since the 2009 lows at (2).

Setting a stop just below the dual support test at (1) looks to be a nice entry point for aggressive traders open to owning hard hit assets.

Stops are very much needed at this price point, as the next key horizontal support comes into play at the 20,000 level, which is a large percentage below current prices!!!

To become a member of Kimble Charting Solutions, click here.





Silver creating a “Double Bottom” pattern?

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

Could Silver be creating a long-term “Double Bottoming” pattern over the past 3-years? Let’s investigate the possibility and what it would take for the potential bullish pattern to fail.

Before we get started let me make this point clear; the trend in Silver since the highs in 2011 remains down!

This chart looks at Silver on a monthly basis over the past 45-years, where we applied Fibonacci retracement levels to its 1980 highs and 1993 lows. The 23% Fibonacci retracement level comes into play at the $14 level.

The 23% level was hit a couple of years (2016), where a 40% counter-trend rally took place. Weakness since the counter-trend high has it testing the 23% level again at (1), where it could be creating a “Double Bottom” formation. While it is testing this key retracement level for the 2nd time, smart money silver hedgers have a huge bet in play it will rally.

What would eliminate the potential that that Double bottom pattern failed? A simple break of the 23% level!

If you would like to invest in Gold, Silver, Copper and the Miners, we would be honored if you were a Metals Member. We are of the opinion some of the best opportunities/inflection points in years for the metals sector are in play!

To become a member of Kimble Charting Solutions, click here.





Dow & Yields testing multi-decade breakout levels

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

This chart looks at the Dow Jones Industrials Average and the Yield on the 10-year note on a monthly basis for several decades.

The top chart looks at the Dow since 1927 and the bottom chart looks at yields since 1994.

The Dow has spent the majority of the past 65-years inside of rising channel (1) while yields have spent the majority of the past 18-years inside of falling channel (2).

The Dow and Yields are both testing breakout levels at the same time at each (3).

The last two times each faced channel breakouts at the same time was 2000 and 2007 at each (A), where each happened to peak.

Just Saying; Both are testing key breakout levels at the same time!!! Should breakouts take place, a strong bullish message to stocks and bearish for bonds!

To become a member of Kimble Charting Solutions, click here.





Tech Leadership testing key breakout test

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

Since the 2009 lows, Semiconductor ETF (SMH) has gained nearly 50% more than the S&P 500 (see upper left chart).

The rally off the 2009 lows has it testing the highs of 2000, as it is creating what looks like a narrowing pennant pattern since the 2018 highs in March.

After hitting the highs 6-months ago, SMH has created a series of lower highs and higher lows inside of pennant pattern (2).

Each of the highs has created bearish reversal patterns (bearish wicks), while the lows have done the opposite (bullish wicks/reversals).

How this leader resolves the narrowing pennant pattern will send an important message to the broad markets! Keep a close eye on SMH in the weeks ahead!

To become a member of Kimble Charting Solutions, click here.





Weekly Market Recap Sep 09, 2018

Courtesy of Blain.

We wrote in last week’s recap:  “One would think the indexes are a bit extended short term”.  And indeed, a rest and consolidation occurred as both the S&P 500 and NASDAQ pulled back to their 20 day moving averages.  (The Russell 2000 did as well but it was not overextended going into the week)

Friday President Trump said the U.S. had tariffs ready to go on another $267 billion in Chinese goods, on top of tariffs on $200 billion in goods the administration is now preparing.

“I think investors were hopeful that we clearly made progress with Mexico [on trade] and Canada seemed to be within a line of sight…and I think investors were saying ‘Maybe we won’t get the fireworks with China and clearly there is disappointment, right now,” said Diane Jaffee, senior portfolio manager at TCW.

Keep an eye on emerging markets – we’ve seen rustling out of Turkey, Argentina, South Africa, etc – it’s still pretty quiet out there but in 1997 a market dislocation hit due to an event in Thailand of all places so the general weakness we are seeing in many emerging markets won’t matter – until it does.

A team led by Marko Kolanovic, global head of macro quantitative and derivatives strategy at J.P. Morgan, blamed the weakness in global markets to a “risk-off” mode with investors seeking to minimize their exposure to risky assets such as stocks amid concerns about contagion from emerging markets as well as the impact of the stronger U.S. dollar and higher interest rates.

The difference between U.S. and emerging-market stock performance this year has been stark. According to Bespoke Investment Group, the divergence between emerging markets and the U.S. stands at a 14-year high, and while this kind of extremity has in the past been followed by a period of mean revision, Deutsche Bank recently wrote that the problems in emerging markets are so severe that a rebound may not be in the cards.

Amazon followed…
continue reading





Stocks Cycle Downward Right On Schedule

Courtesy of Dana Lyons

image

Since working off its early year correction, the U.S. stock market has been on one of those inexorable runs that we’ve seen on so many occasions in recent years. Such runs have seen the market essentially steamroll any and all potential pitfalls that may arise. This recent run has been no exception as the stock rally has basically remained bulletproof to any exogenous hazards (real or fake). But just when the market is on this roll, even breaking out to new highs and apparently incapable of going down, a bout of selling strikes, seemingly out of nowhere. However, if we look a little deeper, perhaps we shouldn’t be surprised by the recent weakness.

The Presidential Cycle refers to the pattern of behavior in stock prices throughout the four years of a presidential term. Specifically, stocks tend to be strong during certain periods of a president’s term and weaker during others. And while there are many factors influencing stock prices during a particular period of a particular presidential term, the cycle has been one of the more historically consistent seasonal patterns.

This may be relevant to the current weakness because, on average, the worst performing month of the cycle, historically, has been September of year 2, i.e., the current month.

As the chart shows, since 1900, September of year 2 of the Presidential cycle has returned an average of -1.43%, slightly worse than September of year 3, February and September of year 1 and May of year 4.

Again, there are many factors that determine the market’s return in a particular month. And returns for a particular month in a particular year will not always match its historical average. That’s what makes an “average”. But to the extent that any month of the cycle can be relied upon to be weak, it is this September of the 2nd year of the Presidential cycle.

But just how reliable is it? And does the market’s recent level of conformity to the historical cycle enhance the pattern’s reliability? And to the extent that it does, what does it imply about the market’s potential path going forward?

In a Premium post at The Lyons Share, we discuss the current year’s performance
continue reading





S&P to follow Gold’s path, questions Joe Friday

Courtesy of Chris Kimble

Is it possible that the S&P could follow the path Gold took 7-years ago this week or will it be “different this time?”

Seven years ago this week, Gold had experienced a 9-year rally, taking it to its Fibonacci 261% level based upon the highs and lows at each (1) in the left chart above. Once it hit the 261% level, it stopped on a dime and started a long-term downtrend, where it is now a third lower than 2011 levels.

We applied Fibonacci extension levels to the 2007 monthly highs and 2009 lows at each (3). The S&P has experienced a 9-year rally, taking it up to its 261% extension level at (4).

Joe Friday Just The Facts – The S&P is facing an important 261% extension level test after a 9-year rally similar to what Gold did in 2011. The big question for the S&P is this….Will it be different this time?

To become a member of Kimble Charting Solutions, click here.





European Stocks Are At A Critical Technical Support Level

Courtesy of Dana Lyons

Several key equity trendline tests are underway across the European region.

The past few editions of our #TrendlineWednesday feature on Twitter have not exactly been the most intriguing we’ve ever posted. In fact, it has been a challenge at times recently to even find enough candidates to publish the feature. This week, however, is a different story. Compelling trendline developments abound in the financial markets – with no area sporting more critical trendline tests than the European equity markets. Here is a sample of some of those key tests underway.

The STOXX Europe 600 Index is testing its post-2009 Up trendline…again.

The German DAX is also testing its post-2009 Up trendline…again.

And the French CAC-40 is testing its post-Brexit Up trendline.

Each of these developments is worthy of its own dedicated blog post. The fact that we are observing coordinated trendline tests across those key markets tells us that this is potentially a key juncture. So is this another buying opportunity – or have these markets worn out the support of their respective trendlines?

*  *  *

If you’re interested in the “all-access” version of our charts and research, please check out our new site, The Lyons Share. You can follow our investment process and posture every day — including insights into what we’re looking to buy and sell and when. Thanks for reading!





Catalysis for a US Dollar Collapse & Gold Blastoff in play?

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

Is it possible that the US Dollar could be creating a multi-year topping pattern, while Gold is creating a multi-year bottoming pattern? I would understand if the majority feels it is almost “impossible,” as the long-term trend for Gold is down and the long-term trend for King Dollar is up!

This chart looks at Gold and the US Dollar on a monthly basis over the past 20-years.

What are the odds that Gold is creating a major bottoming pattern and King Dollar is creating a topping pattern? Very low at this time.

Even though the odds are low that Gold is bottoming and King Dollar is topping, it remains possible that both could be creating major reversal patterns over the past three years!

To prove that major reversals are in play, Gold would need to rally above $1,357 and the US Dollar would need to break below 88.

If are interested in trading or taking advantage of rare pattern setups in Gold, Silver, Miners or Copper, check out our very popular Metals Research Membership.

To become a member of Kimble Charting Solutions, click here.





Catalyst for a US Dollar Collapse & Gold Blastoff in play?

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

Is it possible that the US Dollar could be creating a multi-year topping pattern, while Gold is creating a multi-year bottoming pattern? I would understand if the majority feels it is almost “impossible,” as the long-term trend for Gold is down and the long-term trend for King Dollar is up!

This chart looks at Gold and the US Dollar on a monthly basis over the past 20-years.

What are the odds that Gold is creating a major bottoming pattern and King Dollar is creating a topping pattern? Very low at this time.

Even though the odds are low that Gold is bottoming and King Dollar is topping, it remains possible that both could be creating major reversal patterns over the past three years!

To prove that major reversals are in play, Gold would need to rally above $1,357 and the US Dollar would need to break below 88.

If are interested in trading or taking advantage of rare pattern setups in Gold, Silver, Miners or Copper, check out our very popular Metals Research Membership.

To become a member of Kimble Charting Solutions, click here.





 
 
 

Phil's Favorites

Relaxed environmental regulations heighten risk during natural disasters

 

Relaxed environmental regulations heighten risk during natural disasters

Environmental regulations generally improve communities’ preparedness and resilience during disasters. AP Photo/Gerald Herbert

Courtesy of Brian J. Gerber, Arizona State University and Melanie Gall, Arizona State University

Heavy rains following Hurricane Florence have raised concerns over the release of toxic materials. Ash from coal-fired power plants stored at a landfill ...



more from Ilene

Kimble Charting Solutions

King Dollar Created Multi-Year Topping Pattern?

Courtesy of Chris Kimble.

The currency markets often play a role in asset management for investors. And one key asset that pays close attention to the US Dollar is Gold (and precious metals). Could a near-term trend change be in store for the US Dollar… and its counterpart, the Euro? Precious metals bulls would love to see the US Dollar topping and the Euro bottoming.

In the chart below, you can see that the two currencies are showing similar reversal patterns – a traditional head and shoulders top for the US Dollar Index and an inverted head and shoulders bottom for the Euro.

BUT, they need to confirm these pattern by breaking down / up.

It’s worth noting that NOTHING has been proved so far, but the potential of both creating longer-term reversal patterns is there and traders should stay tuned.

US D...



more from Kimble C.S.

Zero Hedge

Italy's 5 Star Threatens To Ditch Coalition Over Budget Talks, Italian Bonds Slide

Courtesy of ZeroHedge. View original post here.

While the market turmoil over Italy's budget has quieted down in recent weeks as a result of soothing words by the ruling coalition that it would comply with European demands, that snapped moments ago when DPA reported that the leader of Italy's Five Star Movement has threatened to pull the plug on the country's populist government if it cannot find money to implement election campaign promises.

"If we do not find the resources to do what we have said, then it is better for us to go home, there is no point in...



more from Tyler

ValueWalk

How Soon Will A.I. Replace All The Traders: Q&A With Gaurav Chakravorty, CIO Of Qplum

By Jacob Wolinsky. Originally published at ValueWalk.

VW: Tell our readers, what is Qplum?

Qplum is an AI-driven investment management firm. We manage money for individuals, families, and institutions. We actively manage investments using machine learning and deep learning technology.

Our three product lines are:

  1. Wealth, servicing the financial needs of individuals and families via separately managed accounts.
  2. Alpha, for institutional clients only, where we offer different products like GTAA (Global Tactical Asset Allocation), managed futures program, etc. and
  3. Solutions, where we work on customized tactical asset allocation solutions for pension funds and family offices to target a dual loss-aversion and return-seeking investment mandate.

[REITs]

...

more from ValueWalk

Digital Currencies

Mania to Mania

 

Mania to Mania

Courtesy of 

“Russell rarely played the stock market and had little investing experience when he put around $120,000 into bitcoin in November 2017.”

This comes from a CNN money article, Bitcoin crash: This man lost his savings when cryptocurrencies plunged. From January 2017 through the peak in early 2018, Ethereum gained 16,915%.

Any time you have something go vertical, you just know that some peopl...



more from Bitcoin

Insider Scoop

A Peek Into The Markets: US Stock Futures Flat Ahead Of Housing Starts, Current Account Data

Courtesy of Benzinga.

Pre-open movers

U.S. stock futures traded mostly flat in early pre-market trade. Data on housing starts for August and the current account report for the second quarter will be released at 8:30 a.m. ET.

Futures for the Dow Jones Industrial Average fell 1 point to 26,273.00, while the Standard & Poor’s 500 index futures traded declined 2 points to 2,909.75. Futures for the Nasdaq 100 index slipped 1.5 point to 7,523.

Oil prices traded ...



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

Chart School

Weekly Market Recap Sep 16, 2018

Courtesy of Blain.

Slow and steady drip up all this past week in a very quiet news environment.  A gap down top open the day Tuesday (which was recovered quickly) and a gap up Thursday (which held) were the highlights!

The latest on TRADE WARS!(tm):

Tuesday, news hit that China vowed to retaliate and plans to ask the World Trade Organization next week for permission to impose sanctions on the U.S. for Washington’s noncompliance with a ruling in a dispute over U.S. dumping duties, Reuters reported. That’s part of a dispute that goes back to 2013.

“Trade wars are certainly a concern, but I don’t know that they’re a one...



more from Chart School

Members' Corner

Nike, Colin Kaepernick and the pitfalls of 'woke' corporate branding

 

Adding this article to Members Corner, in case anyone wants to share their opinions on Nike and Kaep, or on divisiveness in general. Also see the article I mentioned in the comments section, "A Warning From Europe: The Worst Is Yet to Come" and What’s behind the current wave of ‘corporate activism’? ~ Ilene

Nike, Colin Kaepernick and the pitfalls of 'woke' corporate branding

Courtesy of Simon Chadwick, University of Salford...



more from Our Members

Biotech

Gene-editing technique CRISPR identifies dangerous breast cancer mutations

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

 

Gene-editing technique CRISPR identifies dangerous breast cancer mutations

Breast cancer type 1 (BRCA1) is a human tumor suppressor gene, found in all humans. Its protein, also called by the synonym BRCA1, is responsible for repairing DNA. ibreakstock/Shutterstock.com

By Jay Shendure, University of Washington; Greg Findlay, ...



more from Biotech

Mapping The Market

Mistakes were Made. (And, Yes, by Me.)

Via Jean-Luc:

Famed investor reflecting on his mistakes:

Mistakes were Made. (And, Yes, by Me.)

One that stands out for me:

Instead of focusing on how value factors in general did in identifying attractive stocks, I rushed to proclaim price-to-sales the winner. That was, until it wasn’t. I guess there’s a reason for the proclamation “The king is dead, long live the king” when a monarchy changes hands. As we continued to update the book, price-to-sales was no longer the “best” single value factor, replaced by others, depending upon the time frames examined. I had also become a lot more sophisticated in my analysis—thanks to criticism of my earlier work—and realized that everything, including factors, moves in and out of favor, depending upon the market environment. I also realized...



more from M.T.M.

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 ...



more from OpTrader

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

...

more from Promotions

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...

more from David





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...

Learn more About Phil >>


As Seen On:




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.

Market Shadows >>