ChartWatchers Newsletter Blog Archives

February 2013

Overlaying Indexes Using the Same Vertical Scale

Hello Fellow ChartWatchers!

Overlaid charts are a very powerful feature of  Most people are familiar with using the "Price" Indicator with the "Behind Price" Position setting to create an overlaid chart.  (If you aren't, be sure to read this article for more.)  But overlaid charts can also be tricky to interpret if you are not careful.  Consider the following chart:


Which of these two Bullish Percent Indexes has the higher value?  Looking at the chart, you'd say that both of them are currently about equal since both lines meet in the upper right corner, correct?

That would be an inaccurate interpretation however.  Notice that this overlaid chart has two different vertical scales - the one on the right (54-78) is for the main ticker symbol ($BPNYA in this case) and the one on the left (48-64) is for the first overlaid symbol ($BPCOMPQ).  

Here's the important part:  For standard overlaid charts like this, our system automatically expands the vertical scale for all overlaid symbols so that the smallest value is very close to the bottom of the chart and the largest value is very close to the top.

When you are comparing two very different things - like two different stocks or a stock with an index - then that automatic expansion works well.  However, when you are overlaying things (usually indexes) that share a common data range (e.g., Bullish Percent Indexes, Bond yields, etc.), you can easily create confusing charts.

In those cases, instead of using the "Price" indicator, you need to use the "Price (same scale)" overlay.

Compare the chart below with the chart above:


This is the correct chart to use when comparing the values (and thus the "strength") of these two indexes directly.  It clearly shows that the NYSE BPI has been consistently higher than the Nasdaq BPI for months.

Again, I created this second chart by using the "Price (same scale)" overlay with $BPCOMPQ as its parameter.  By understanding when to use the "Price" indicator" and when to use the "Price (same scale)" overlay, you will be able to create even better, more powerful charts.

- Chip


Quick Site Notes:

  • We've create a new version of PerfCharts that we need help testing.
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  • We've announced new SCU seminars for Long Beach, Seattle, and New York.
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  • The next ChartCon conference will be held in 2014.  We want to ensure that ChartCon is always a high-quality event.
  • Our online, educational videos area continues to grow.


2013 Sector Leaders are Energy and Financials

SECTOR LEADERS YEAR TO DATE... Chart 1 plots relative strength ratios of the energy, financial, and industrial sectors versus the S&P 500 (the black zero line). Those three sectors have been the top performers year to date. Technology has been the weakest (on a relative basis). Let's start by taking a closer look at the two top sectors -- energy and financials.


ENERY ETFS ARE BREAKING OUT TO THE UPSIDE... The weekly bars in Chart 2 show the Energy Sector SPDR (XLE) breaking out of a bullish "symmetrical triangle" (see circle). [A symmetrical triangle is defined by two converging trendlines. Since it's a "continuation" pattern (and the prior trend was up), it's a bullish pattern]. The XLE is now challenging its early 2011 high. A rise above that barrier (which appears likely) would pave the way for an eventual rise to its 2008 peak. Its relative strength ratio (gray area) has also turned up during 2013 for the first time in two years. The weekly bars in Chart 3 show the Market Vectors Oil Services ETF (OIH) rising above a "neckline" drawn over its 2012 peaks (circle). Its relative strength line (gray area) has also turned up.



FINANCIALS REACH FOUR-YEAR HIGH... It's usually a good sign for the stock market when financial stocks are in a leadership role and in an uptrend. That's certainly the case on both points. Chart 4 shows the Financials Sector SPDR (XLF) having risen above its 2011 peak to reach the highest level since 2008 (see circle). That represents a major bullish breakout and suggests that the bottoming pattern that started in 2009 has been completed. Its relative strength ratio (gray area) has also been rising and and is now at the highest level in nearly two years. The XLF includes a wide range of financial stocks that include banks, brokers, insurance, financial service companies, and REITS.


Reasons to be Concerned with the Tech Sector

This weekend, I want to talk about the technology sector. Some of the major tops of the market have been spotted on the $NDX before the market breaks down.
Here's the chart. It has a lot of data on it. I would encourage you to click on this link $NDX to see a larger version.

$NDX 20130215

Let's start at the top.

  • Lower Valleys on the RSI seem to be one of the consistent themes among the recent tops.

Well, we clearly are seeing that here. 3 months  after the RSI has put major lows in, we are trending up, but I think everyone could agree begrudgingly. The tech market has not exactly exploded higher.  If you look at the shaded area behind the RSI, that is the $NDX compared to the $SPX. It has been under performing for a while now.

  • Looking at the CMF, the surface area of the recent pullbacks below zero are large, like the 2007/2008 top.
  • The major fund managers aren't as supportive.  
  • After 3 months off the November low it hasn't been an overwhelming bull surge in.  The price action is barely above the moving averages where usually the $NDX surges away from the moving averages. Maybe its just early and I am too optimistic in this charts power to outperform.
  • The Head/Shoulders pattern is remarkably clear and the MACD is mimicking a perfect trend for a head/shoulders top. Highest peak on the first one, progressively lower after that.  You will also notice the red arrows I placed on the 2 previous market peaks. They both happened at the 3rd peak of the MACD pattern. Again, the lower lows on the MACD is a better indicator than the lower highs but even the slightly lower highs were present in 2010.   Specifically on the MACD, we would be very concerned if the market rolled over at this level. The MACD at such a low level, rolling over near zero would confirm a bigger decline coming in my view.
  • To confirm all of this, The Full Sto's are above 80 so you are in overbought territory or a strong bull market depending on your view. I don't find the full Sto's that valuable an indicator currently, but if it breaks through the bottom of the current trendline (not immediately), we could find ourselves in a big bear market. Currently, the Full Sto's are half way between. Still bullish based on any interpretation.
  • Lastly, I want to point out that MSFT was the market leader and it fell fast and hard in 2000. Then AAPL was a big market leader and it fell fast and hard from Dec 2007. And then recently, AAPL was the market leader but it has recently fallen fast and hard with slight slowing of growth. After a 40% pullback, we are all expecting it to rise here. In both previous cases, the pullback was 70%. 
Too bearish a prediction? I don't know. I just know that all the traits and patterns are lining up. As the experienced technician likes to say....I know, it's different this time.

I will blog about the tech stocks this week. You can follow my blog at this address - The Canadian Technician.

Good Trading,
Greg Schnell, CMT

Six Important Short-Term Warning Signs for This Market

I remain bullish for 2013 and believe we could see 1700-1800 on the S&P 500 before the year is over.  But I can't deny the short-term warning signs that are showing up everywhere.  Let's take the issues one at a time.
1.  Historical Tailwinds Have Ended
Since 1950, the months of November, December and January have been the three best consecutive months for the S&P 500 and have accounted for roughly 50% of all of this benchmark index's gains during this period.  That period just ended.  Unfortunately, February has carried an annualized return of -1.27% over the past 63 years on the S&P 500, making it the 2nd worst calendar month of the year.  Making matters worse, February has an annualized return of 5.02% from the 1st through the 15th, but has an annualized return of -11.47% in February AFTER the 15th.  Friday was February 15th.
2.  Momentum Has Slowed
We only have long-term momentum issues on a few indices that include biotechs and homebuilders.  But shorter-term negative divergences are popping up everywhere.  On Friday, I ran a StockCharts scan of POSITIVE divergence candidates and there were 30.  I then ran a scan looking for potential NEGATIVE divergences and my scan returned nearly 200.  Obviously, momentum is becoming an issue.
Over the past three months, financials (XLF) and industrials (XLI) have been the relative leaders with gains of 17.73% and 16.77%, respectively.  But slowing momentum is already very obvious on both of these daily charts.  Check them out:

XLF 2.16.13

XLI 2.16.13

The move higher has been great.  17% returns in 3 months - it's tough to beat that.  Yet both of these leaders are looking like they need a rest.  Higher prices with lower MACDs don't guarantee us that a correction is coming, at least not as far as I'm concerned.  What they DO tell me, though, is that risks are elevated and that is what technical analysis is all about.  Instead of shallow pullbacks to test rising 20 day EMAs, I'm beginning to think we're ready for 50 day SMA tests.
3. The Volatility Index ($VIX) Bottoming?
On Friday, the VIX not only tested the January low, signaling perhaps a double bottom, but it also printed a doji candlestick.  Dojis are considered reversing candlesticks and it would make sense for the VIX to reverse at the current level.  If it does reverse and move higher, it'll likely come at the expense of a declining stock market.  You can check out the potential VIX bottom here:

VIX 2.16.13

4.  The Dollar Rising
There has been a strong inverse correlation in place for several years between the direction of the U.S. dollar and the direction of the S&P 500.  Lately, however, the S&P 500 has attempted to move higher while the dollar also moves up to test resistance.  Something has to give here.  A breakout in the dollar likely would increase the selling pressure on equities, so as we begin a new trading week, I'd keep an eye on how the dollar trades.  Look at the recent POSITIVE correlation:

UUP 2.16.13

5.  Major Price Resistance
The Dow Jones has been battling the 14000 level for two solid weeks without much success.  Just above that psychological price level is the Dow's all-time closing high on October 9th, 2007, of 14164.53.  In addition, more recent price resistance resides at 3194.86, which represented the opening price on September 21, 2012 on the NASDAQ.  While the NASDAQ was able to clear this level late last week, it's hard to call what it did a "breakout".  Check it out:

NASDAQ 2.16.13

So, in addition to all of the issues above, throw in significant resistance on two of our major indices.
6.  Weak Friday Finish
I realize it's just one day, but our major indices have tended to finish much stronger than they did on Friday.  I understand the Dow Jones turned green at the close, but note how both the NASDAQ and Russell 2000 lagged and finished well off earlier intraday highs.  In addition, the three top performing sectors on Friday were all the defensive groups.  It seems to be that the market is prepping for a pullback sooner rather than later.
Given all the warning signs, I'd avoid most stocks as we head into a holiday-shortened trading week.  In particular, there are 5 S&P 500 stocks that look particularly vulnerable to selling this week.  CLICK HERE or more details on these stocks.
Happy trading!

Gold Now Approaching Critical Support

Downward pressure in gold prices continued as very large funds liquidated substantial portions of their positions in the gold ETF (GLD). (See article.) Naturally, we need to look at the charts to give this story some context. (Charts were made before the close.)

The daily chart shows that price has reached the bottom of the declining trend channel, the top of which is drawn from the October high. This was something we thought likely because price failed to reach the top of the channel before it started down again. Another important event that happened today was that the 50-EMA crossed down through the 200-EMA, signalling nominally that gold is in a long-term bear market. The same type of EMA crossover occurred back in May 2012, so, obviously, the "long-term" nature of the signal is not carved in stone, but it does set the tone for the gold market.


To more accurately assess the long-term picture we need to zoom back to the weekly chart. Here we see the +170% advance from the 2008 low. After the top in 2011, prices have been moving in a horizontal range between 1540 and 1800, in what we would call a high-level consolidation. This is also known as a continuation pattern, which implies that prices will eventually break out of the consolidation and continue higher. That is a nice scenario for gold bulls, but first it appears that prices will have to retest the support at 1540 at least one more time. Obviously, that is a critical support level.


The most striking aspect of gold's behavior since the 2011 top, is that it is not following "the script", which is that the Fed printing press will drive gold prices higher. With the Fed printing money at unprecedented rates, why, we must ask, have gold prices stalled for almost a year-and-a-half? When our assumptions are not confirmed by actual price movement, we must reassess our assumptions. A possible alternative would be that the Fed's actions are not causing inflation, but deflation, at least in that part of the economy that affects gold prices. To better understand how this could be true, I recommend that you read the Quarterly Review and Outlook, Fourth Quarter 2012, by Dr. Lacy Hunt of Hoisington Investment Management.

Conclusion: Gold could be in the process of consolidating a massive up move, and it is currently headed toward a retest of the bottom of the consolidation range at 1540. Failure of that support level would suggest that assumptions about the Fed causing inflation (and an increase in gold prices) should be questioned.


QQQ Hesitates, but the ETF is not Lost Just Yet

The Nasdaq 100 ETF (QQQ) just can’t seem to find its mojo this year, but the 2013 trend is still up and the bulls still have the edge, albeit a slight edge. First, note that QQQ has been trending higher since mid November. A three month uptrend means the medium-term trend is up, which establishes the path of least resistance. Second, QQQ stalled the first six weeks of the year and the Bollinger Bands narrowed significantly in early February. A Bollinger Band squeeze signals a volatility contraction that can lead to a volatility expansion.

Click this image for a live chart

It looked like the bulls were taking control when QQQ gapped up and broke resistance six days ago, but the ETF went right back into stall mode after this breakout. Looks like the volatility expansion has been put on hold. Technically, the breakout is holding because the gap has yet to be filled. After holding 67.50 for six days, a close below this level would provide the first sign of trouble. Medium-term, the January-February lows mark key support in the 66-66.50 area. Also notice that Aroon Up (green) remains above Aroon Down (red), although Aroon Down moved above 50 this week. A bearish Aroon cross would put another straw on the bull’s back. You can read more about the Bollinger Band Squeeze and Aroon indicators in our ChartSchool.

Enjoy the long weekend!
Arthur Hill CMT


Starting in the summer, some of the global stock markets started to move higher. Once Mario Draghi suggested he would do whatever it takes to save the euro, the European markets have been on a tear higher.
This is the first monthly close that all 18 global markets I track are above the 20 Month MA. Why is that level significant? Because when the entire world got above the 20 Month MA in 2003 it confirmed the global push higher and lasted 4 years. In 2009 it did it again but it only lasted into 2010 when the Shanghai started weakening. Here we sit in 2013 with all the global markets pushing higher. Here is what it looks like simplified.

Screen Shot 2013-02-01 at 8.56.40 PM

When the entire world is trying to rally together, it can be very supportive. Both exports and internal confidence grows which can be very complimentary.
So we have to maintain a bullish approach to the markets. Why fight this trend?

As regular readers of The Canadian Technician blog are aware, the commodities have not broken out yet, but are very close.
While I want to see that happen for obvious reasons, I have one interesting hurdle the markets have to overcome.
This is the chart of the 4 major commodity supply countries charts for the last 15 years. (Commodity Countries)

Commodity Countries 2013

Now we could debate exactly where to draw each line. These lines reflect a range that has significant support and resistance in each market.
Brazil actually rose above the line in January and has since pulled back under.

A renewed interest in commodities would probably confirm the new bull market. If it was to all unwind after a giant final rally that stalled at resistance on both the commodity and equity markets, this would be the time. I see very little negative divergence on the major indices so that is positive. The $USD is testing the lower boundary of its trading range. The Euro is pretty stretched here with gapping 1 cent moves a couple of times a week. Feels like an exhaustion move to me and based on the blue boxes below it looks like this run has been at least as long as the previous bull run into the September high.

$XEU 2013

So just when everybody shouts the all clear, I see some major similarities in these charts that might take time to work through.
Maybe the bulldozer provided by central banks worldwide will break down the barriers and this will all breakout to the upside shortly.

I'm Bullish and have been for months but the charts usually stair step up at a rate slower than 50% a year gains.
After a 10% move off the November lows, it might be time to expect a step. $TSX

$TSX 20130201

Good Trading,

Greg Schnell, CMT


Energy apparently has more fuel in the tank.  After underperforming the past couple years, it has rocketed higher to start 2013 and was the leading sector during what was a VERY solid January.  As a student of history, that January strength bodes well for the stock market during the balance of 2013.  Expect all-time highs on the S&P 500 later this year and those future gains are likely to be accompanied by a rapidly rising energy group.  In my last article, I showed a chart of the oil services index ($OSX) that reflected relative breakouts that were just barely taking place.  Given the action the past couple weeks, those relative breakouts are much more clearly defined now.  Take a look:
$OSX 2.2.13
This is truly a perfect storm.  Energy (XLE) is breaking out relative to the S&P 500 ($SPX).  Oil services ($OSX) broke out of a symmetrical triangle on a long-term weekly chart.  The $OSX is breaking out on a relative basis vs. both the $SPX and the XLE.  Currently, I don't really see any better area in the market to trade than oil services.
Within the $OSX, check out Halliburton (HAL), one of the many oil services components with improving technicals:
HAL 2.2.13

So where else can we turn?  The market's overbought and chasing anything should be considered dangerous.  Well, technology has been the most disappointing sector the past few months as Apple's (AAPL) struggles have been well documented and have compounded the difficulties for the NASDAQ 100 ($NDX).  But let's not forget it was AAPL's strength that catapulted the $NDX on a relative basis prior to this latest period of disappointment.  Could the $NDX be ready to jump back into the fray?  Check this chart out and you be the judge:
NDX vs. SPX 2.2.13

Since 2006, this relative chart has been trending higher.  With every relative breakout, the previous relative support held during periods of tech weakness.  According to the chart above, we're going to find out a lot about the long-term relative strength of the $NDX.  Personally, I believe the group is now primed to outperform once again.  But I wouldn't rush into the first component that you come across.  In fact, on Friday, I listed 24 component stocks of the $NDX printing long-term negative divergences on their daily charts for the benefit of our members.  I would avoid them.  While that doesn't guarantee selloffs, it certainly increases the risk of holding or (gasp!) buying these stocks.  The good news is that there were 32 stocks in the $NDX that looked very solid to me technically.
On Monday, I'm featuring one of these $NDX component stocks in the midst of a VERY bullish ascending triangle pattern.  I expect it to lead to outsized gains, especially on a high volume breakout.  If interested, you can sign up for our FREE weekly newsletter (simply provide your e-mail address) and I'll be happy to send you my annotated chart.  CLICK HERE for more details.
Happy trading!


READER QUESTION: I am always curious why you elect to use a surrogate of a market to provide a technical analysis.  The one I have a concern with is using UUP to analyze a H&S formation and mention violation of support.  However, the actual dollar chart shows that support still holds.

CARL'S ANSWER: The first reason is that we don't have access to spot prices on commodities because of the expense of getting a data feed from the commodities exchanges. What we have available are futures-based indexes, such as $USD (Dollar Index), $USB (30-Year T-Bond), and $WTIC (Crude Oil), which report daily prices for the near futures contract. The problem is that, as the near contract nears expiration, the index begins tracking the next nearest contract, which is normally has a different price. These monthly rollovers cause a lack of continuity in historical prices, similar to stock prices that are not adjusted for splits and distributions, and the usefulness of these indexes for the purpose of technical analysis is somewhat degraded to say the least.

The other reason we use ETFs for our analysis is that an ETF most accurately depicts that actual cost of trading the commodity. It includes transaction costs, the cost of rolling from one contract to another, etc. Also, basically, you can't trade the index, but you can trade the ETF.

The following charts illustrate the differences. The Dollar Index presents a more optimistic picture...


... than the ETF (UUP).


Conclusion: We prefer to use ETFs instead of futures-based indexes because they more accurately reflect the the results of running a fund for a given commodity. Most important, the technical analysis we apply to the ETF has practical value, since the ETF can be traded.


My Thursday message showed the Power Shares Dollar Index Bullish Fund (UUP) on the verge of a technical breakdown. The weekly bars in Chart 1 show the cash version of the Dollar Index. It too has a bearish look by showing the US Dollar Index threatening to fall below a "neckline" drawn under its 2012 lows. That would signal a drop in the $USD to it 2011 lows. [Thursday's message showed most of the dollar weakness coming from rising European currencies]. One asset class that would benefit from a falling dollar is commodities. That partially explains why commodities ended the week on a strong note. The weekly bars in Chart 2 show the DB Commodities Tracking Fund (DBC) climbing to a three-month high (brown circle). [The DBC includes 14 energy, metal, and agricultural commodities]. Chart 2 also shows the dollar (top of chart) and commodities trending in opposite directions over the last two years. A "neckline" is drawn on the commodity index over its 2012 highs (which matches the bearish "neckline" on the USD). Commodities are also starting to play catchup to a rising stock market and stronger economic signals. In that scenario, economically-sensitive commodities like energy and industrial metals should be the biggest gainers. Agriculturals and gold are commodity laggards.




There has been quite a bit of banter recently about a "currency war" developing given the Japanese Yen has fallen dramatically against the USD - roughly -15% in the past 11-weeks. This is a rather major move for a currency; and it is such that it is providing cover for Japanese exporters against those in Europe and the US as well as other emerging markets. Remember, the US continues to print money via QE-4, while Europe has simply said it "has what it takes, and believe us - it is enough. Japan on the other hand, simply said they would raise their inflation target from 1.0% to 2.0%, and employ an open-ended asset purchase plan...beginning in January 2014. One must wonder aloud why the Japanese aren't doing so now; and whether or not they are following the Europeans by jawboning the markets. In light of this, it would be wise to consider the technical condition of the US dollar as the "race to the bottom" looks to get much more interesting in the weeks and months ahead.

USD 2-2-13

Quite simply, the US dollar is forming what is clearly a bearish "head & shoulders" topping pattern, and is on the verge of breaking down below neckline support. This would be a major violation, and thus would target the waterfall lows formed back in May-2011. And with volatility growing in the currency markets, then this decline could be just as quick over a couple of months. That said, one would ostensibly wonder which currency or currencies one would buy against the US dollar to take advantage of just such a move. In our opinion, the Euro and the Swiss Franc - with the Swissy being our favorite currency given her outstanding fiscal situation.

Lastly, we should point out that the US dollar decline to the May-2011 low was accompanied by increased volatility in the stock market - and a majority of this volatility resulting in a sideways trading pattern...ultimately resulting in a sharp decline into September 2011. So, caution is advised; especially given the recent euphoria.

Good luck and good trading,



Hello Fellow ChartWatchers!

The Dow moved above 14,000 yesterday at 11:04am.  How do I know the exact time that happened? I know because StockCharts tweeted about it the instant it happened.  Did you know we automatically tweet about a wide variety of significant technical signals, automatically alerting anyone who watches our Twitter feed?  It is just one of dozens of improvements we made to the website over the course of 2012.  Here are some other improvements you might not know about:

Unadjusted Data -

Just add an underscore to the front of any ticker symbol to see what the unadjusted chart looks like. (more info)

User-Defined Indexes -

Upload data from any spreadsheet and then use our tools to chart it. (more info)

Revamped Public ChartLists -

Better ways to find ChartLists that match your interests.  More rewards and perks for Public ChartList authors. (more info)

StockCharts University Seminars -

Live, all-day training seminars given by myself and/or Greg Schnell in major cities throughout North America. (more info)

More Indicators and Overlays -

We now have over 50 different technical indicators including Pring's Know Sure Thing (KST), the Mass Index and the Vortex Indicator.  (more info)

User-Defined Technical Alerts -

Members can now receive automatic emails whenever a specific technical situation occurs. (more info)

More Color Schemes and Skins -

Spruce, Graphite and Dark Green (among others) have been added to the Color Scheme dropdown.  In addition, some of those schemes support UI "skins" that change the color of your entire charting workbench to match the color of your charts.  (more info)

Gatis Roze's "Traders Journal" Blog -

Gatis' unique perspective on how real-world traders operate was a wonderful addition to our Blogs area.  His "Traders Journal" articles are highly recommended - as are all our Blog articles!  (more info)

Mobile Website -

You can now use directly on your mobile device - phone or tablet and see pages specifically designed for touch-based interfaces. (more info)

Educational Videos -

Arthur Hill has created a wonderful collection of free educational videos about technical analysis and using (more info)

PRO Service Level -

For people that need more, our new PRO service level offers 5-second refreshing, historical data back to the 1960s, downloadable data, more User-Defined Indexes and Alerts, bigger charts, and more. (more info)

Improved ChartStyles -

Our most recent improvement is the addition of a new interface for creating, using and organizing ChartStyles. (more info)

Phew! and I probably forgot several other things we've added.  So what's coming next?  Well, first of all we are dedicated to continue improving the website and helping everyone get the most out of it.  That said, we are hard at work on even more great improvements which you can expect to see in the coming months and years.

We believe that this dedication to continuous improvement is why AAII called us "Best of the Best" in its latest review of web-based charting tools and why, for the readers of "Stocks & Commodities" magazine have one again voted us "Best Technical Web Site" for the 11th straight year!

Here's to an even better 2013!
 - Chip 


With a 150-point gain to end the week, the Dow Industrials closed above the next big number (14000) and hit a significant milestone. There is usually nothing special about round numbers, such as 14000, but this number is special because the Dow failed at 14000 in 2007. The financial crisis and subsequent swoon in financial stocks helped push the senior average below 7000 in early 2009. Friday’s advance allowed the Dow to complete a six year round trip. What a long strange trip it’s been. The chart below shows the Dow falling 50% and then requiring a 100% advance to make up for this decline. This is a great lesson for traders. In percentage terms, it always takes a bigger advance to make up for a loss. A decline from 100 to 80 is 20%, but it takes a 25% gain to back to 100 and make up for that loss. This is why risk management is so important.

Click this image for a live chart

Speaking of risk, the Dow is short-term overbought after a 1000 point advance in five weeks. Nevertheless, the path of least resistance is up and I would consider the long-term trend bullish as long as the Dow holds its rising 24-month EMA and the Commodity Channel Index (CCI) remains in positive territory. As the vertical lines show, this combination has been pretty good at defining long-term trend changes over the last 10 years. Broken resistance in the 13650 area turns into the first support zone to watch on any pullback.

Go Niners!
Arthur Hill CMT
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