DecisionPoint

March 2016

DecisionPoint

The DecisionPoint Thrust/Trend Model - Part II

by Erin Swenlin

Welcome to Part II of Thrust/Trend Model (T/TM) education. In Part I, I discussed how the Intermediate-Term Trend Model (ITTM) and Long-Term Trend Model (LTTM) generate BUY/SELL and Neutral signals. The ITTM and LTTM make up the "Trend component" of the Thrust/Trend Model. The second component of the T/TM is "thrust". Thrust measures momentum and internal strength using two DecisionPoint indicators, the Price Momentum Oscillator (PMO) and the Percent Buy Index (PBI). Each creates their own BUY and SELL signals. Combined, these signals determine the overall timing signal for the Thrust Read More 

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Market: Overbought and Topping

by Carl Swenlin

On Thursday SPY broke below a short-term rising trend line. This might not have been too big a deal, but there is other evidence that something more negative is developing. For one thing, we can see on the chart that the PMO has topped at an overbought level similar to the PMO top in November. Zooming out to a three-year time frame gives us a better perspective, emphasizing that the current PMO reading is at the top of the normal range. The three DecisionPoint proprietary indicators shown are my primary intermediate-term tools. The PMO is derived from Read More 

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The DecisionPoint Thrust/Trend Model - Part I

by Erin Swenlin

I'm going to give you jump on a ChartSchool article in the making on the DecisionPoint Thrust/Trend Model. Although Carl and I retired it from the DecisionPoint Market/Sector Summary, it is still available in the DecisionPoint Market Indicator ChartPack (free download!).  The Thrust/Trend Model is made up of two primary components, thrust and trend. Each component produces its own BUY/SELL signals, with the Trend Model sometimes triggering Neutral signals. The T/TM actually combines three different timing signals. Thrust is about momentum and internal strength Read More 

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House of Cards and the 50-50-90 Rule

by Carl Swenlin

While watching the fourth season of House of Cards I have been reminded of the 50-50-90 rule: Anytime you have a 50-50 chance of getting something right, there's a 90% probability you'll get it wrong. House of Cards is a Netflix series depicting political intrigue and mayhem in Washington, D.C.  Season four is set in the 2016 election season, which is a bit tedious, considering all the real political stuff we watch in our home. An amusing (to me) back story this season is that oil prices are through the roof, and we see a replay of the 1970's gas shortage. It is amusing because in Read More 

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Bear Market PMO Scan Screens a Few "Dogs"

by Erin Swenlin

With the market overbought and ready for at least a pullback, I decided to run one of my bear market Price Momentum Oscillator (PMO) scans to see if I could find a few "dogs" out there. The scan produced a handful for review but the two below stood out to me. They are in the Healthcare/Pharm industries which is the last sector on the DecisionPoint Market/Sector Summary with Neutral signals. Here is the scan that I performed: [group is SP500] AND[today's PMO Line(35,20,10) > today's PMO Signal(35,20,10)] Read More 

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Financial Sector Lagging - Review of Deutsche Bank (DB), Equal-Weight ETF (RYF) and SPDR (XLF)

by Erin Swenlin

A reader and viewer emailed me and asked me to take a look at Deutsche Bank (DB). While I normally don't do specific chart reviews as part of my blogs or webinars, today we received a new Intermediate-Term Trend Model (ITTM) BUY signal on the equal-weight Financial ETF (RYU). The Financials SPDR (XLF) hasn't yet triggered an ITTM BUY signal, but it is getting close. The question is whether this is really a recovery in the Financials sector. If you look at the DecisionPoint Market/Sector Summary (found in the DP Reports blog) below, you can see that it has been moving "green" during this Read More 

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SPY: Rising Wedge Delivers but Dissapoints

by Carl Swenlin

One of my favorite chart patterns is the wedge -- rising or falling -- because it can usually be depended upon to resolve opposite the direction the wedge is moving. Specifically, a rising wedge will usually resolve downward and vice versa. Recently I saw some wedges developing on the SPY chart that reinforced my bearish feelings about the rally off the February lows. They have resolved as expected, but bearish expectations have not been realized. Let's watch the evolution of the evidence. On Monday the wedge formation I had been following looked like it was sure to break Read More 

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Dow Leads the Way with First Intermediate-Term PMO BUY Signal on DP Scoreboards

by Erin Swenlin

Short-term and Intermediate-Term Trend Model BUY signals began appearing on the DecisionPoint Scoreboards this week. I suggested in a previous ChartWatchers article that these signals would be the first indication that the bear market may be coming to a close. I also wrote that the next step would be to see the weekly Price Momentum Oscillators (PMOs) on the DP Scoreboards have positive crossovers. The first of those signals, appeared today on the Dow Industrials. Below is the weekly chart where you can see the Read More 

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New! Intermediate-Term Trend Model BUY Signal on Dow

by Erin Swenlin

The DecisionPoint Scoreboards had a big change today, probably the first of a few more. The new Intermediate-Term Trend Model BUY signal for the Dow Industrials isn't necessarily a buying opportunity. With the recent rally, price has been trading well above the 50-EMA so consequently, the 20-EMA was able to speed up for a positive crossover the 50-EMA. However, there are some serious problems with the charts that suggest price is ready to decline not breakout. First is the daily chart for the Dow Industrials. The rally has been Read More 

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GOLD: Correction Coming?

by Carl Swenlin

Last week I expressed my reluctance about writing an article about gold two weeks in a row; yet, here I am with article number three. I couldn't help it because I'm seeing a chart pattern that makes me think that gold will be experiencing a correction very soon. Last week I said I expected $GOLD to break out of the pennant formation seen on the price chart. This happened on Thursday, and on Friday price pulled back to the breakout point, as is the technical expectation. The only problem is that now I see a PMO (Price Momentum Oscillator) pattern forming that typically appears at price Read More 

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What Do You Mean... "Fierce Overhead Resistance"?

by Erin Swenlin

I suspect a few eyebrows were raised when they saw the title to my DecisionPoint Alert blog article today, "Fierce Overhead Resistance Looming". Resistance lines, support lines and trend lines are usually considered stronger based on how many times price "touches" them. Intuitively this makes sense. If price forms support at a intermediate-term low and then rallies, when it begins to fall again, buyers begin lining up to purchase at that low so they can catch the next rally. Each time price falls to that level and buyers pick price back up, it forms an even stronger support line. The Read More