ChartWatchers March 17, 2018 at 10:30 AM
Regional Banks had a great week. Lots of them are testing big breakout levels and making new highs. Some examples are: Brookline Bancorp: In the small cap SCTR ranking. Independent Bank Corp (IBCP) is starting to move. It is also increasing the dividend consistently. Live Oak Bankshares (LOB) IPO'd three years ago. After consolidating all of 2017 it looks to be on the move again. There are lots of interesting new highs showing up. If you look through the Predefined Scan results on the right hand side of the Free Charts tab, you will Read More
ChartWatchers March 17, 2018 at 08:56 AM
The NASDAQ Composite and NASDAQ 100 became the first two key indices to break to fresh all-time highs and their 2018 relative strength can be underscored by this chart: The NASDAQ 100 is seeing money rotate its way in 2018 so it's prudent to focus on this index for specific trading ideas. And this brings me to my February 3, 2018 ChartWatchers article, "The NASDAQ 100 And Its Best Seasonal Candidates in February". In that article, I proposed two seasonal trading candidates - Adobe Systems (ADBE) and Booking Holdings (BKNG, formerly priceline.com, or PCLN). Since the Read More
ChartWatchers March 17, 2018 at 04:35 AM
The Dow Industrials is in the midst of a narrowing consolidation and chartists should watch the March range for the next directional clue. The 2018 range extends from the January high (26,617) to the February low (23,360), which is 3257 points or around 13% of the current close. The range narrowed as the Dow formed lower highs and a higher low. As such, a large symmetrical triangle formed over the last few months. I am using closing levels to mark the first support and resistance levels to watch for a break. The March 2nd close marks resistance at 25335 Read More
ChartWatchers March 16, 2018 at 07:24 PM
If there's one thing I've learned over my many years trading in the market, it's to avoid chasing a stock, especially if it's overbought. This might seem like an obvious strategy but many traders are drawn to those stocks that are ascending which I can understand. But if you end up buying near the top you might find yourself holding a position which has little prospect to rise further while your capital remains tied up. As an example, take a look at the chart below on Meritor which soared after it reported strong earnings at the end of January. Someone bought that stock just above $29.50 Read More
ChartWatchers March 16, 2018 at 06:00 PM
On Friday's MarketWatchers LIVE program, I did a workshop on volume. Highly recommend you check it out on the StockCharts YouTube Channel or it is available under the webinars tab until Monday's show begins. We talk about volume all the time, but why is understanding and following it important? Well, Dr. Alexander Elder in his book, The New Trading for a Living (available in the StockCharts Store) explains volume can be a very powerful tool to determine the financial and emotional involvement in a particular stock or index. Remember that a unit of volume Read More
ChartWatchers March 03, 2018 at 04:02 PM
Editor's Note: This article was originally published in John Murphy's Market Message on Friday, March 2nd at 12:26pm ET Wednesday's message showed the PowerShares QQQ (representing the Nasdaq 100 Index) pulling back from overhead resistance at its late January peak. That suggested profit-taking in the technology-dominated QQQ and the rest of the market. It also suggested a retest of its 50-day moving average. Chart 1 shows that test taking place today. Since the QQQ led the market higher during its February rebound, what it does from here will tell us something about the direction of the Read More
ChartWatchers March 03, 2018 at 03:04 PM
I did a review of the monthly charts Wednesday and noticed a bearish bias. Today three new Intermediate-Term Price Momentum Oscillator (PMO) SELL signals arrived. The weekly PMOs crossed below their signal lines which triggered these signals. Weekly charts are presenting bearish characteristics. After looking at all three of these weekly charts, the main thing to notice are the rising bottom trend lines price could continue lower and preserve the rising trend. Helpful Read More
ChartWatchers March 03, 2018 at 02:55 PM
After a massive run in 2017, the market has paused to absorb all the news of the tax package. I am reminded of other instances where the market sold off on good news, surprising retail investors. Stock markets usually lead the economy, but that does not mean that a little rock and roll won't happen along the way. When the $SPX was flying above a long term moving average by such an extreme (13%), who wouldn't expect some correction of sorts? A crack in the momentum trend shown by the PPO can be a clue to more weakness. In this particular case Read More
ChartWatchers March 03, 2018 at 12:39 PM
THE Question Is this a correction within a bull market or is it the beginning of a bear market? That is THE question that everyone is debating and hoping to answer correctly. There's no crystal ball to know for sure the correct answer. However, the market does provide us clues if we're willing to look for them. Let's begin with the knowledge that roughly two-thirds of GDP is comprised of consumer spending. So it makes common sense to analyze consumer stocks for clues about the direction of our economy and, hence, the stock market. The aggressive component Read More
ChartWatchers March 03, 2018 at 03:14 AM
The principle of confirmation is important to the application of Dow Theory. This principle asserts that the Averages, Dow Industrials and Dow Transports, should confirm each other when making new highs. In other words, both should make new highs to affirm the broad market trend. Failure by one results in a non-confirmation that reflects underlying weakness. Chartists can apply this confirmation principle to sector analysis and assess the state of broader market. I am not going to use all ten sectors because the bottom five sectors account for less than a quarter of the S&P Read More
