ChartWatchers Newsletter logo

January 2017

ChartWatchers

10-Year Treasury Yield Is Bouncing Off It's 50-Day Average, As is The Dollar

by John Murphy

The pullback in Treasury yields (coinciding with an oversold bounce in Treasury prices) may have run its course. Chart 1 shows the 10-Year Treasury Yield ($TNX) bouncing sharply off its 50-day moving average. The two momentum indicators above Chart 1 are also supportive. The 14-day RSI (green) line is back above the 50 level. The more sensitive 14-day Slow Stochastics oscillator (top box) is rebounding from oversold territory below 20. My Saturday message also showed potential support at its November 2015 peak ranging from 2.34% to 2.30%. That may also be providing a floor beneath the TNX Read More 

ChartWatchers

This Weak Industry Group Approaching Very Bullish Historical Period

by Tom Bowley

There haven't been too many areas of the market that have performed worse than retail stocks over the past month.  While the NASDAQ 100 ($NDX) has jumped to record highs over the past month, weak retail stocks in that index like Dollar Tree (DLTR), Walgreens (WBA), O'Reilly Automotive (ORLY), Tractor Supply (TSCO) and Ross Stores (ROST) are littered among the worst performing NDX stocks. But here's the good news. The Dow Jones U.S. Apparel Retailers Index ($DJUSRA) is approaching key price support where I'd expect to see strength emerge.  Take a look at the current weekly Read More 

ChartWatchers

5 Boring Uptrends in 5 Exciting Stocks

by Arthur Hill

One would normally not consider Facebook, Alphabet, Apple, Amazon and Microsoft boring. Well, maybe Microsoft. All joking aside, these tech titans are the biggest stocks in the Nasdaq 100 ETF (QQQ) and they account for around 40% of the ETF. This means traders or investors in QQQ best follow these five charts closely. These titans also account for around 13% of the S&P 500 SPDR, which is yet another reason to make these charts part of your routine.  While their businesses are certainly not boring, their long-term charts are quite boring. And this can be a good thing Read More 

ChartWatchers

Cruise Ships Are Continuing To Make New Customer Highs

by Greg Schnell

Cruise ships seem to be getting more elaborate every year. From water slides high up over the ocean, to real grass top decks and stunning restaurants throughout, the industry is growing in diversity and customer experiences.  Recently, the trends have started to change on some of the cruise line companies charts. Carnival Cruise Lines (CCL) and Royal Carribbean Cruise Lines (RCL) are moving higher and Norwegian Cruise Lines (NCLH) is the weakest of the three but still climbing.   Norwegian Cruise Lines (NCLH) pushed to new 8-month highs this week. The SCTR has been Read More 

ChartWatchers

Utilities Equal-Weight ETF (RYU) Lights Up with Weekly PMO BUY Signal

by Erin Swenlin

On Friday, I received a StockCharts Technical Alert in my email inbox letting me know that the Equal-Weight Utilities ETF (RYU) had triggered a new Intermediate-Term Price Momentum Oscillator (PMO) BUY signal. I immediately had to check out the weekly chart. There is a clear breakout from a declining trend channel and that PMO BUY signal is in historically oversold territory. The 17-week EMA managed to stay above the 43-week EMA suggesting some strength. To drill down further, I went into the DecisionPoint "Straight Shots" ChartPack to the RYU Read More 

ChartWatchers

A Sure Recipe for Success - or Not!

by John Hopkins

Earnings Season is now in high gear with thousands of companies getting ready to report their numbers over the next several weeks. Whenever earnings season comes around there are clear winners and clear losers with the sole evidence of success or failure being the performance of a stock. For example, Netflix reported its numbers last week and you can see the positive response below: You can see the nice bump on strong volume that occurred on January 19 that in fact took the stock to an all time high. On the other hand, take a look at the GE chart below which shows a different picture of a Read More 

ChartWatchers

Dow Flirts With 20K, While NASDAQ Closes At Record High

by John Murphy

Let's get this out of the way first. If you've been watching business TV, all they've been talking about is the Dow nearing the 20,000 level. Much to their dismay, it came close on Friday but couldn't make it. The Dow touched 19999.63 before backing off. Historically, big round numbers have acted as magnets during market advances. At the same time, traders are often programmed to take some profits as that big number is approached. The hourly bars in Chart 1 shows how close the Dow Industrials came to the 20K level a couple of times over the last month. Technically, the Dow is still in an Read More 

ChartWatchers

Guess What? "Official" Earnings Season is About to Begin

by John Hopkins

No one can argue with the fact that the market has been fascinating to watch since the election with all of the major indexes substantially higher since the most recent bottom on November 4. There's been a few minor pullbacks along the way, but not many as traders seem to be eager to jump in on any moves lower. And now traders will have another reason to get excited; earnings season is about to begin! For a long time now the market has recognized Alcoa's earnings report as the "official" start to earnings season. And AA will report its numbers after the bell on Monday. Then you will see Read More 

ChartWatchers

Energy Continues To Lead And Prospects Here Remain Bright

by Tom Bowley

I've been writing relentlessly about the relative strength in energy shares (XLE) over the past several months and here I go again.  Go ahead and talk about too much supply.  Hang onto the weakening demand argument if you'd like.  I'm simply following the charts which is what technicians do.  The stock market knows ALL of the fundamental information and it's been priced in.  And what the market keeps telling me is that you want to overweight energy.  It's that simple and until rotation strips away that technical strength, I'll keep riding this horse Read More 

ChartWatchers

An Update On Gold

by Greg Schnell

Gold traded fabulously last year. Actually Gold surged from January to March then went sideways. Well Gold has started to outperform the $SPX but everything else looks dismal. The SCTR is stuck at 2% even after Gold surged. The volume has started to improve, but it is still a lot less than the selling volume through November and December.  I wrote about Gold back on December 2nd and explained why we might have some positive price action show up in December. That article can be accessed here. Is There A Holiday Present For Gold Investors? Read More 

ChartWatchers

I am One with the Trend and the Trend is with Me

by Arthur Hill

I recently saw the new Star Wars movie, Rogue One, and found a way to tie technical analysis to one of the more interesting characters. This happens all of the time because technical analysis is so ingrained in my membrane. Chirrut Îmwe is a blind warrior monk who repeated: "I am one with the force; the Force is with me". If he were a trend-follower, I think he would simply substitute "force" for "trend". Works for me!  The chart below shows the S&P 500 hitting a new all-time high this week and the force is clearly bullish. In Dow Theory terms, think of the force as the primary Read More 

ChartWatchers

AT&T Takes a Nose Dive

by Erin Swenlin

A regular DecisionPoint webinar viewer and reader emailed me and suggested I take a look at AT&T because as he stated, "ouch". It was definitely a rough day for AT&T and what happened today has some very interesting implications. Price dropped almost 2% today. It came right after the negative divergence materialized between price tops and OBV tops. It also came after two unsuccessful tests of overhead resistance. The Price Momentum Oscillator (PMO) triggered a SELL signal as it crossed below its signal line today and also pierced the 20-EMA. Optimistically, price could find Read More