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November 2009

ChartWatchers

Holiday Special Starts and Announcing our New Loyalty Rewards Program

by Chip Anderson

Hello Fellow ChartWatchers! I have two big announcements for you this time around: OUR HOLIDAY SPECIAL IS NOW ON! With the holiday season just around the corner, we've fired up our Holiday Special.  It's a great way for you to join up or extend your StockCharts.com account at the lowest possible cost.  Here's how it works: - Sign up for 6 months of any of our services and receive ONE ADDITIONAL MONTH FOR FREE. OR - Sign up for 12 months of any service and receive TWO additional months for free. To get started, just visit our Service page, determine which service level Read More 

ChartWatchers

Gold and Silver Bull Market Rages On

by Tom Bowley

While there are lots of questions surrounding the sustainability of the stock market advance, there seems to be little resistance ahead for commodities, specifically gold and silver.  The U.S. dollar is the primary variable.  As you can see from the charts below, gold and silver seem to have no boundaries to the upside.  Every time the dollar shows any strength to the upside, it is met with heavy selling and back down it goes.  Those same consistent headwinds for the dollar are providing gold and silver with tailwinds and the bulls are taking full advantage.  Read More 

ChartWatchers

LARGER CORRECTION LOOMING FOR GOLD?

by Richard Rhodes

Gold prices are obviously rising, and they are rising rapidly. However, given the move has begun to go parabolic in its 8-year of rally - we have to question how much higher gold prices can go in both the short and intermediate-term. To this end, the monthly charts adds some perspective in our mind. First, let us state that we are not gold bugs, although we do believe they are headed sharply higher in the years ahead - hence we're intermediate-term bullish, with projections much higher than current levels. Second, in the shorter-term, we question whether prices have become just a bit too Read More 

ChartWatchers

Dow Hits Top of Channel

by Arthur Hill

The Dow has been moving higher the last three months with surges early in the month and pullbacks later in the month. Notice how the Dow bottomed in early September, early October and early November. Also notice how the Dow peaked in mid September and mid October. Here we are in November with an early month advance and the Stochastic Oscillator overbought. As long as the Stochastic Oscillator remains above 80, it should be considered both overbought AND bullish. Notice how the indicator remained above 80 for two weeks in September and two weeks in October (yellow areas). Currently, the Read More 

ChartWatchers

TRENDLINES AND 50% RETRACEMENTS REACHED

by John Murphy

The following three charts show the three major U.S. stock indexes having reached formidable overhead resistance barriers. Charts 1 and 2 show the Dow Industrials and the S&P 500 having retraced 50% of their bear market declines. More importantly, both indexes are testing major down trendlines drawn over 2007/2008 peaks. Given the fact that the market has rallied 60% in the last eight months without a meaningful correction, that's some cause for concern. Chart 3 shows a slightly different picture for the Nasdaq market, but the message is essentially the same. The Nasdaq Composite has Read More 

ChartWatchers

STOCKS STILL OVERVALUED

by Carl Swenlin

Stocks have been in the overvalued end of the normal P/E range since the early-1990s, and this condition shows no sign of abating. Below is an excerpt from our daily earnings summary that will offer readers a better perspective. I have outlined the 2009 Q4 results because that is the first quarter not distorted by the huge loss reported in 2008 Q4. While the results of the current quarter are not final, 90% of companies have reported, and I don't think there will be any surprises from the remaining companies sufficient to change the estimated results a substantial amount. As you can see Read More 

ChartWatchers

BARRICK AND NEWMONT MINING TURN UP

by John Murphy

With gold hitting new record highs each day, gold stocks are starting to play catch-up. Two of the biggest are at or very close to hitting new 52-week highs. Chart 1 shows Barrick Gold closing at a new 52-week high today. The gray line is the ABX/SPX ratio which has been dropping since February and just starting to rally. Chart 2 shows Newmont Mining closing at a new 52-week high as well. Its relative strength ratio (gray line) is turning up as well. What the two RS lines tell us is both big gold stocks are pretty good values relative to the rest of the market and are starting to show Read More 

ChartWatchers

BIOTECHNOLOGY ETF FINDING SPONSORSHIP

by Richard Rhodes

We find it rather interesting that the laggard Biotechnology group and the Biotechnology ETF (BBH) in particular have begun to find sponsorship; and it is our opinion that BBH is set to embark upon a period of both absolute and relative out-performance. Quite simply, BBH is forming a rather large and bullish consolidation, which implies prices will move above previous high resistance at $103.50 - a level that has proved for weakness in the past. But the prime reason we should consider long positions is that the 400-day moving average has held, while the longer-dated 40-day stochastic is Read More 

ChartWatchers

MARKET IS STRONG, BUT CORRECTION SHOULD CONTINUE

by Carl Swenlin

Looking at the S&P 500 chart below, the breakdown from the ascending wedge pattern is clear enough, and expectation of the breakdown has been fulfilled. The rising trend line violation brings with it the expectation of a continued decline, but I do not have a price target at this time. The horizontal dotted lines show the closest and furthest likely support levels, but I have no expectations regarding either one. At this point, I am still expecting a price low at the end of this month based on the 20-Week Cycle low projection, but it doesn't look as if the price correction will be Read More 

ChartWatchers

VOLUME TRENDS REVERSE; H&S PATTERNS EMERGE

by Tom Bowley

In my latest article on October 18, I provided a very cautious tone but noted that volume trends remained strong - good news for the bulls!  Well, short-term volume trends now have turned negative, though the really key long-term price support levels remain intact.  A couple damaging technical developments make the end of week rally very suspect.  In the chart below on the NASDAQ 100 (or NDX), check out several annotations of significance:  There's a lot of information on this chart to digest so let's address each item, one at a time.  First, notice Read More 

ChartWatchers

TECHNICAL ANALYSIS 101 - PART 15

by Chip Anderson

This is the next part of a series of articles about Technical Analysis from a new course we're developing. If you are new to charting, these articles will give you the "big picture" behind the charts on our site. if you are an "old hand", these articles will help ensure you haven't "strayed too far" from the basics. Enjoy!  (Click here to see the entire series.) Price charts often have blank spaces known as gaps. They represent times when no shares were traded within a particular price range. Gaps result from extraordinary buying or selling interest developing when the market is Read More 

ChartWatchers

LONG-TERM RATES MOVING BEFORE STOCKS

by Arthur Hill

The 10-Year Treasury Yield ($TNX) is largely positively correlated with the S&P 500 - and also shows a propensity to lead the stock market. The chart below shows the 10-Year Treasury Yield peaking in July 2007 and stocks peaking in October 2007, three months later. Similarly, the 10-Year Treasury Yield bottomed in December 2008 and stocks bottomed in March 2009, again 3 months later. The 10-Year Treasury Yield now has peaks in early June and early August. In addition, the 10-Year Treasury Yield broke below its July low with a decline into early October. Should the current pattern Read More