Don't Ignore This Chart

Dark Cloud Cover for ODFL

by Chip Anderson

( Click here to see a live version of this chart.) The Dark Cloud Cover candlestick pattern occurs when a stock that is in an uptrend has a tall hollow candle that is followed by a tall filled candle that extends below the mid-point of the first candle. A Dark Cloud Cover pattern signals short-term weakness for the stock.  The idea is that investors who were excited by Thursday's big rise are now disheartened by today's lack of follow through - thus making another rally unlikely in the near term. Read More 

Don't Ignore This Chart

Nasdaq Bullish Percent Index will Signal the Return of the Bulls

by Chip Anderson

(Click on the chart for a live version) The Nasdaq Bullish Percent Index represents the percentage of Nasdaq stocks that have Bullish signals on their P&F charts.  Typically, readings oscillate around 50.  Readings above 60 are rare and indicate a strong rally is underway.  Readings below 20 are also rare and usually indicate market weakness. $BPCOMQ's strong move above 60 in early 2003 signaled the end of the last bear market.  Expect a similar move to herald the end of the current recession. Read More