ChartWatchers July 20, 2018 at 06:37 PM
The Financials SPDR (XLF) and Industrials SPDR (XLI) weighed on the broader market the first six months of the year, but perked up in July and started to show some upside leadership. The PerfChart below shows the percentage change for the ten sector SPDRs from December 29th to June 29th, the first six months of 2018. Only three sectors stand out: the Consumer Discretionary SPDR (red), the Technology SPDR (green) and the Energy SPDR (black). The rest were either fractionally higher or down. Notice that the Financials SPDR (blue) and Industrials SPDR (magenta) were down 3.97% and 4.58% Read More
ChartWatchers July 20, 2018 at 06:35 PM
Traders have been waiting patiently for Q2 earnings season to begin and now they need to wait no longer. Already we've heard from some of the largest banks in the world and on Tuesday we heard from EBAY, who came up short and then Thursday from one of the largest Market Cap tech companies, Microsoft, who exceeded expectations. To me the market is at its finest when companies that come up short of expectations are punished while those that meet/beat expectations are rewarded, which is the way it should be. We can see this in the two charts Read More
ChartWatchers July 07, 2018 at 01:08 PM
StockCharts.com has a nice Dynamic Yield Curve tool that anyone can use. It's extremely friendly. As we roll through the pictures in this article, notice the date in the upper left corner of the yellow box. The red vertical line on the yellow background on the right side shows it in the context of the stock market. Here is a snapshot of the tool on July 12, 2016. In the picture above, we can see the line tilted sharply higher. The black shading is the yield each of the bond maturity dates have travelled and the red is the line at the snapshot in time. About 2% between Read More
ChartWatchers July 07, 2018 at 08:55 AM
Let's first talk about a trading strategy that doesn't work. I steer clear of companies that struggle to meet Wall Street expectations and there's a very simple reason why. Management helps Wall Street set their expectations. So when companies miss their targets, it's essentially a confession by management that they could not deliver on their promise. They weren't capable of executing. Let me give you a perfect example of what I avoid. PriceSmart, Inc. (PSMT). Here's a company that missed its earnings expectation for the Read More
ChartWatchers July 07, 2018 at 08:00 AM
On the Relative Rotation Graph above I have grouped a selection of world equity market indices, mainly some big regions, and put them against the Vanguard Total World Stock Index (VTWSX) as the benchmark. What immediately grabs our attention, or at least mine is the fact that this selection is clearly split between positive (Leading) and negative (Lagging). The universe The universe on the RRG is found in the table below I have collected a number of ticker symbols for important international equity markets Read More
ChartWatchers July 07, 2018 at 12:21 AM
On a day when stocks are rising, and all eleven market sectors are in the black, healthcare is the standout performer. This chart shows the Health Care SPDR (XLV) rising to the highest level since the middle of March. The bottom box shows the XLV/SPX ratio rising to the highest level since late April. The XLV has been rising faster than the SPX since the start of May. The XLV now appears to be on the verge of exceeding its March intra-day high at 86.23. Biotechs are the main driving force behind today's healthcare surge. Read More
ChartWatchers July 07, 2018 at 12:18 AM
The market has been in stall mode for quite some time now. Even though the S&P perked up some on Friday it's still hanging out near levels seen in early January, going nowhere fast. At the same time the market has had all kinds of reasons to totally collapse; tariff wars, Fed tightening, rising US dollar, to name a few. Yet the S&P is back above all key technical levels, waiting for any bit of good news to move it into high gear. And where might that good news come from? Earnings. For sure there's actually no way of telling Read More
ChartWatchers July 06, 2018 at 06:53 PM
I've presented my favorite PMO scan numerous times during the MarketWatchers LIVE show, but also in articles. Here's a link to my article on that scan. However today I wanted to present my "Chart Breakouts" scan. I use this scan during the MarketWatchers LIVE show to find stocks or ETFs that are just beginning to breakout and also picking up momentum. Below is the CandleGlance of the chart breakouts I presented in today's show. Not all of these are great, but you can see that most have broken declining tops trendlines or above very short-term resistance. Read More
ChartWatchers June 16, 2018 at 04:45 PM
Relative Rotation Graphs® originally emerged out of my work on sector (rotation) analysis while employed as a sell-side analyst providing services to institutional clients. Shortly after the first introduction as a tool to visualize sector-rotation a lot of other possibilities to use RRGs sprung to mind. One of the first ideas was to use a Relative Rotation Graph at the highest level of an investor's decision tree, Asset Allocation. The first decision someone has to make whether he (or she) wants to invest or stay with a savings account. But once the Read More
ChartWatchers June 16, 2018 at 02:03 PM
On Friday, the weekly charts went "final". With that finalization, the NDX which had been carrying a positive Price Momentum Oscillator (PMO) crossover throughout the week, finally posted the IT PMO BUY signal on its DP Scoreboard. Additionally, sentiment charts were very interesting this week. The National Association of Active Investment Managers (NAAIM) posted the 3rd highest market exposure reading since it started in 2006 and put/call ratios are at multi-year lows. High readings on NAAIM suggests excessive bullishness. I've annotated the Read More
