Don't Ignore This Chart

November 2013

Don't Ignore This Chart

The Squeeze Play is On for Qlogic

by Arthur Hill

After a big surge in October, Qlogic (QLGC) moved into a consolidation as volatility contracted. Notice that the Bollinger Bands contracted and the Bandwidth moved to its lowest level of the year. The stock is showing some signs of buying pressure with two white candles over the last five days. A follow through breakout at 12.6 would signal a continuation of the October advance. Read More 

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Home Construction SPDR Makes the Aroon Bull Scan

by Arthur Hill

The Home Construction SPDR (ITB) is making a bid to break resistance as Aroon Up surges above Aroon Down. Also notice that Aroon Up hit 100, which suggests that a new uptrend may be emerging. Note, however, that this is the third time in three months that Aroon Up has surged to 100. ITB needs to confirm with a breakout and higher high. Read More 

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Skyworks Solutions Breaks Cup-with-Handle Resistance

by Arthur Hill

The cup-with-handle pattern is a bullish continuation pattern that was popularized by William O'Neil of IBD. The handle marks a small consolidation near resistance and the breakout confirms the pattern. With the cup measuring around three points from low to high, chartists can project a three point move from the rim breakout, which targets a move to the 29.5 area (26.5 + 3 = 29.5). Read More 

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Pre-defined Technical Alerts Page Lights Up Green

by Arthur Hill

Stocks opened higher on Monday with several ETFs hitting new highs and new all time highs. Chartists can follow these milestones on the Predefined Technical Alerts page. In addition to several major stock indices, note that XLY, XLV, XLI and XLF recorded new highs on Monday. Also note that oil dipped below 95. Click this image for a live page Read More 

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Retail SPDR Hits Channel Trend Line

by Arthur Hill

The Retail SPDR (XRT) has been one of the strongest industry group ETFs this year with a 25+ percent advance. Even though the ETF is looking overextended as it hits the upper trend line of a rising channel, it is by no means weak. Notice that XRT has traded in the upper half of this channel for most of 2013. Also notice that CCI has been positive since the first week of January. Any weakness would be considered a correction within the bigger uptrend. Broken resistance turns first support in the 84-85 area and January support is set in the 75-76 area. Read More 

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Gentiva Bucks the Selling Pressure with 3-Day Advance

by Arthur Hill

The healthcare sector is one of the strongest sectors in the market, but Gentiva (GTIV) has lagged and failed to keep pace. Even though the stock is in a medium-term downtrend, this decline could be a correction. Notice how the decline formed a falling wedge and retraced 62%. Also notice how the stock firmed after the sharp decline in early November and bucked market selling pressure the last three days. Key resistance is set at 12 and a breakout here would reverse the falling wedge. Read More 

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Vertex and Yahoo! Lead Nasdaq 100 MarketCarpet

by Arthur Hill

The Nasdaq 100 MarketCarpet was mixed on Wednesday with several big losers and a handful of strong gainers. The dark green boxes show big gains in Yahoo! (YHOO), Vertex (VRTX), PriceLine (PCLN) and Gilead Science (GILD). These gains were countered with sizable losses in Tesla (TSLA), Randgold (GOLD), Ebay (EBAY) and DirectTV (DTV).   Read More 

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Under Armour Forms Bearish Candlestick Pattern

by Arthur Hill

Under Armour (UA) is currently in a long-term uptrend, but the stock stalled over the last three months with a head-and-shoulders pattern taking shape. The right shoulder is under construction with a bearish engulfing marking the high. The September-November lows mark neckline support in the 75-76 area. Read More 

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LinkedIn and Tesla Go their Separate Ways

by Arthur Hill

There was a time when LinkedIn (LNKD) and Tesla (TSLA) were joined at the hip and led the momentum crowd. Both stocks surged from January to September and then corrected from early October to mid November. This relationship appears to be changing as Tesla sank to new lows for the month and LinkedIn rebounded with a strong surge. Notice how Tesla broke down in early November, consolidated with a pennant and broke pennant support with a sharp decline the last three days. In contrast, LinkedIn formed a bullish engulfing last week and followed up with a surge above 230. Read More 

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Peabody Breaks P&F Support as Coal Loses Favor

by Arthur Hill

Coal stocks were hit with selling pressure after the TVA announced the closing of eight coal-fired power plants. The 60-minute P&F chart shows BTU breaking Quadruple Bottom support and sporting a downside price objective of 18.65. Note that chartists can change the period settings and price fields underneath the chart. You can read all about P&F charts in our ChartSchool.   Read More 

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Zynga Forms Bullish Pattern and Zyngs Higher

by Arthur Hill

After a bullish engulfing on Tuesday, Zynga (ZNGA) surged to triangle resistance with high volume on Wednesday. Overall, chartists can make a bullish case for this internet-mobile gaming company. A higher low formed in August and the stock surged above the July high with good volume in September. The subsequent triangle consolidation represents a rest after this big move and a break above triangle resistance would signal a continuation higher. Careful with this one because the combination of low price and high volatility make this a high-risk play – either way. Read More 

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Nasdaq and NYSE Most Actives Go Ten for Ten

by Arthur Hill

It was a big day for stocks as the ten most active stocks on the NYSE and Nasdaq advanced. As the Free Charts page shows, both exchanges went ten for ten. Bank of America (BAC) led the NYSE with a 2+ percent gain. Facebook (FB) led the Nasdaq with a 4+ percent gain. Chartists can click on the PerfChart or CandleGlance links to see charts for all ten.  Click this image for ten most active Nasdaq stocks. Read More 

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Nikkei Breaks Wedge Resistance as Yen Weakens

by Arthur Hill

The Nikkei 225 ($NIKK) broke above wedge resistance with a surge to 14589 and extended its long-term uptrend. First, note that the long-term trend is up after the big surge from November to May. Second, this triangle represents a consolidation and the breakout signals a continuation of the uptrend. Third, notice that the Yen Index ($XJY) is breaking the triangle trend line and the Nikkei is negatively correlated with the Yen. Key support for the Nikkei is set at 13900 and a break below this level would warrant a reassessment.   Read More 

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Bollinger Bands Narrow as Copper Consolidates

by Arthur Hill

Spot Copper ($COPPER) has gone nowhere the last three months and a narrowing consolidation is taking shape. The pink lines show the Bollinger Bands narrowing as volatility contracts. This is confirmed by the bandwidth indicator, which is trading near seven month lows. Traders should watch range for a break to trigger the next directional signal. Read More 

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Dow SPDR Forms Massive Engulfing Pattern

by Arthur Hill

There are bearish engulfing patterns and then there are BEARISH ENGULFING PATTERNS. With a strong open and weak close on Thursday, the Dow SPDR (DIA) formed the latter. This is the second bearish candlestick pattern in two weeks. A follow through break below the early November low would confirm this pattern and reverse the five week upswing. Chartists can also watch the MACD Histogram as a move into negative territory would signal a downturn in momentum.   Read More 

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Twitter Establishes First Support with Consolidation

by Arthur Hill

There is not much historical data for Twitter (TWTR) because it opened for trading just today. However, there are already signs of support near the opening price. The 1-min chart shows TWTR opening at 45.10, surging to 50 and then falling back to the 45 area. Notice how the stock consolidated from 11:20 to 11.35. The consolidation lows now mark the first support level to watch (44). Things will change rapidly on this chart, but you can click the image to see a live chart with current data. Read More 

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Facebook Doubles Down with Two Candlestick Patterns in Four Days

by Arthur Hill

Facebook (FB) came across the bullish engulfing scan twice in the last four days. The stock fell to support last week and then formed a big bullish engulfing pattern on high volume. After a pullback on Friday-Monday, the stock opened weak on Tuesday and closed strong to form another bullish engulfing. Read More 

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RSI Breaks Key Level on Carmax Chart

by Arthur Hill

Carmax is making a move as it bounces off support and breaks wedge resistance. Support in the 46-47 area extends back to the July low. The breakout is valid as long as it holds and I would watch 47.6 for the first signs of failure. The indicator window shows RSI breaking the early September trend line and moving above 50. Read More 

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Paper-Forest Products Lead Industry Group Market Carpet

by Arthur Hill

The Market Carpet shown here focuses on the US industry groups from the Market Summary Market. Chartists can focus on a particular section of a Market Carpet by double clicking a square. Notice that the DJ US Paper-Forest Products Index ($DJUSFR) is the best performer over the last five days. The HealthCare Products Index ($RXP) is also strong, while the Disk Drive Index ($DDX) and the Gold-Silver Index ($XAU) are weak. *LINEBR** Read More 

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Dollar ETF Gains in October as Oil ETF Gets Hit Hard

by Arthur Hill

This PerfChart shows ten ETFs that cover the intermarket picture. Notice that nine of the ten moved higher with stocks and gold leading the way. Oil was hit the hardest with a 5+ percent loss. In a surprise, the Dollar and the Euro both gained. Dollar strength can be attributed to Yen weakness. Read More