Trend Check with Tushar Chande

Market Reaches My 2663 Target

by Tushar Chande

The $SPX high today (11/30) was 2657.74, a whisker away from my year-end target of 2663, a prediction I derived from my post-election model in April, and made explicit in my September 29 post (see below).  Not bad. Not bad at all.   Chart 1: Screen shot of my Sep 29 post.     Chart 2: The post-election model shows the most recent close is not very far from my year-end target. Read More 

Trend Check with Tushar Chande

Trend Analysis of Jim Cramer's Anointed 15 (Or, Using the Chande Trend Meter)

by Tushar Chande

The Chande Trend Meter (CTM) is a flexible tool for analyzing absolute trend strength across all time frames.  I will illustrate its application using a list of 15 stocks that Jim Cramer of CNBC called the "anointed ones", stocks that are likely to go higher because they have a strong institutional fan base on Wall Street.  I will show that CTM can be combined with StockChart's SCTR to find the stocks on Cramer's list. I will also show that CTM scales sensibly across time frames, from intra-day to monthly, whereas the SCTR is only computed using daily data and re-plotted on Read More 

Trend Check with Tushar Chande

Berkshire Hathaway (BRK.B) Attractive to Long-term Investors

by Tushar Chande

Berkshire Hathaway, buffeted by tax plan headlines, has pulled back into support, and offers a potential entry point for long-term investors. The market itself has seen selling in the short-term time frame. However, intermediate-term and long-term trends are still bullish, as they have been all year.   Chart 1: Berkshire Hathaway (BRK.B) retests its prior breakout at 182, with support starting at 177.  The solid black line is the 130-day simple moving average. (A live version of the chart is here.)     Read More 

Trend Check with Tushar Chande

Using Momentum ETFs

by Tushar Chande

Momentum ETFs are a useful way to invest in strongly trending markets.  Here momentum is generally measured as a combination of monthly returns over different periods.  Since capitalization is always a concern for the larger ETFs, the larger the capitalization and the stronger the recent price performance, the larger the allocation to the stock.  In general, when market trend strongly, momentum ETFs are expected to do well (see Chart 1). Chart 1: Momentum ETFs have typically done better than the $SPX as we should expect from their design. Read More 

Trend Check with Tushar Chande

Re-optimizing the 4 Percent Rule (Initial Withdrawal Rate) for Low Inflation

by Tushar Chande

This post is for retirees or those near retirement.  All of you will have to make some decisions on how to manage withdrawals from your retirement portfolio.  The Bengen 4 Percent Rule is the industry standard, which states that an initial withdrawal rate of 4 percent of starting capital, adjusted for inflation each year, will be a "safe rate" that will "ensure" that you will "not run out of money" over a 30-year retirement horizon.  Naturally, the higher the "safe" withdrawal rate, the larger your spending budget, the "better off" you will be. Read More 

Trend Check with Tushar Chande

Micron Technology (MU) Captures The Essence of this Rally (Or, Market Trend Check 10/31/2017)

by Tushar Chande

The rally in Micron since the breakout I pointed to in early September (see Chart 9 of that post) neatly summarizes the story of this market. In the composite charts below, at left is the initial breakout, on September 14.  I felt this breakout was an important sign that the market would rally.  On the right is Micron today, rallying mightily, just like the rest of the Technology sector. That in short is what the market has done and is doing, with a more detailed analysis below. The breakout in Micron Technology (MU) was a key sign of the rally to follow Read More