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About this blog: is our free newsletter for individuals interested in technical trading and chart analysis. It is sent out twice a month via email. This blog contains early-access, preview versions of the articles that later appear in the official newsletter.

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ChartWatchers

My New Favorite Scan - Excellent Results Using SCTR and Rising PMO

by Erin Swenlin

If you watch MarketWatchers LIVE regularly, you've probably heard about my new scan. I've found, especially when the market has a bearish bias, that my original Price Momentum Oscillator (PMO) scan wasn't producing any results. I consider this a caution flag before I get too involved with the results of my new scan. The original scan is below. Its requirements are quite high, so I won't get results in a bearish market; not only do I need a PMO on a rising trend, but the EMAs need to be configured bullishly. After the market takes a serious hit, there aren't that many stocks Read More 

ChartWatchers

Weekly Sector Rankings Show a Defensive Market

by John Murphy

Editor's Note: This article was originally published in John Murphy's Market Message on Friday, May 17th at 4:49pm ET. The table in Chart 1 plots the relative performance of the eleven market sectors for the week. And they show a generally defensive market. That can be seen by the fact that REITs, utilities, and consumer staples are the three top sectors for the week. At the same time, the weakest sectors are financials, industrials, cyclicals, technology, and materials. Industrials were pulled lower by Deere and Caterpillar. Technology was held back by semiconductors with exposure to Read More 

ChartWatchers

Banks Around The World Drop

by Greg Schnell

From what I can see, global bank charts are continuing to weaken. The banks as a whole have rolled over in the last two weeks, but we have some major banks around the world making new multi-year lows. This is problematic. First of all, we have the chart for KBE below. If this is an average of the banks, that average is now below both the 10-week and 40-week moving averages. The price action is also continuing the downtrend. Notice that momentum, shown by the PPO, is rolling over at zero. This is not good.  But the world has some banks in serious trouble from a Read More 

ChartWatchers

A Bearish Failure Swing for the Russell 2000

by Arthur Hill

The bearish failure swing is a bearish RSI signal from Welles Wilder, creator of RSI. Note that this signal is NOT the same as a bearish divergence, even though a bearish divergence is also possible at the same time. A bearish failure swing has four parts: RSI moves above 70 (1), RSI falls back below 70 (2), RSI rises and fails to exceed 70 (3), RSI falls below the intermittent low (4).  The failure occurs when RSI fails to exceed 70 on the bounce. Signal confirmation occurs when RSI breaks its prior low. The failure below 70 shows waning upside momentum, while the break below the Read More 

ChartWatchers

Here's What a Double Looks Like

by John Hopkins

Every trader dreams of owning a stock that doubles. If it can happen in just six months, even better. This has been the case for Twilio (TWLO), a stock featured during our Top 10 Stock Picks webinar in November of 2018 that has doubled in price since the November 20 bottom of $71.56.  You can see in the chart below that the stock came close to revisiting that November 20 bottom when the overall market melted down in late December. However, it instead put in a slightly higher low and then went off to the races. Take note also of the Read More 

ChartWatchers

S&P 500 Reverses Off Key Support, New Leadership Emerging

by Tom Bowley

It was a brutal week, especially given the surging U.S. equity prices throughout 2019 thus far.  The benchmark S&P 500 fell 2.18%, but intraweek losses were far steeper.  There was a significant reversal on Friday as the Volatility Index ($VIX) appeared to confirm a near-term top - a bullish development indeed.  The first chart illustrates the technical strength and reversal of the S&P 500 on its weekly chart: Any time I see the PPO rising like this, I expect a 20 period EMA test to provide support.  The green arrows show several kick saves at 20 week EMA Read More 

ChartWatchers

Three Bright Spots Outside the United States

by David Keller

“The world is a book, and those who do not travel read only a page.” - Saint Augustine I recently returned home after a 10-day trip to Scotland with my family for Spring Break. We rented a car in Glasgow, made our way up into the Highlands and took a ferry over the Isle of Lewis, where we rented a house for the week. We enjoyed meeting new people and learning about Scottish Gaelic, we loved the challenge of driving a manual transmission on the left side of the road and we treasured finding cute little places to grab fresh seafood during our excursions. Most of all, we Read More 

ChartWatchers

How To Play The Hot IPO Market - One Sound Approach Can Help You Navigate These Fast Movers

by Mary Ellen McGonagle

The number of IPOs listed in the U.S. has picked up this year. While some high-profile companies have already come public, there are more highly anticipated companies that are due to list shortly, such as the ride-share company Uber and workplace messaging app Slack. Some of these recently public companies have performed well, making it worth your while to check out these stocks. After all, the powerhouse FAANG stocks of today all started out as new issues at some point. That said, investing in new issues is not for the faint of heart, as these generally smaller companies can be quite Read More 

ChartWatchers

Prices May Be Falling, But Bond Spreads (Confidence) are Holding in There

by Martin Pring

Editor's Note: This article was originally published in Martin Pring's Market Roundup on Wednesday, May 8th at 6:37pm ET. One area I monitor daily is the technical picture of bond spreads and other market relationships that reflect confidence. That’s because changes in their direction often lead or confirm what is actually happening to equity prices in general. One of my favorites is the ratio between the iShares High Yield and iShares 7-10-year treasury ETFs (_HYG/_IEF). When it is rising, it indicates investors and traders are growing in confidence concerning the level of business Read More 

ChartWatchers

Building A Case For SYY In The Staples Sector Using Three Relative Rotation Graphs

by Julius de Kempenaer

Relative Rotation Graphs can be a great asset in getting a high-level overview of what is going on in the markets and keeping an eye on the big picture. Beyond that, though, they can also help you to drill down to find new individual investment possibilities and trading ideas. For this week's ChartWatchers newsletter, I will use three Relative Rotation Graphs to make a case for a single stock trade idea. Starting At The Top The daily RRG for Asset Classes above shows the rotation of various asset classes against the Vanguard Balanced Read More 

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