Don't Ignore This Chart

Is This Data Storage Company Ready For A Breakout?

by Tom Bowley

There's a potential bottoming reverse head & shoulders pattern in play on Western Digital's (WDC) three year weekly chart as it attempts to clear its downtrend on its SCTR.  All of this comes on the heels of printing a positive divergence on its MACD.  This alone would have me looking for a 50 week SMA test, with that moving average currently residing at 56.70.  Here's the visual: While we still have one more trading day left this week, currently the weekly candle is that of a dragonfly doji.  Considering it marks a potential reverse right shoulder and is Read More 

Don't Ignore This Chart

Bristol Meyers Leads as Price Relative Hits New High

by Arthur Hill

Chartists need just two plots to find leaders and stocks in uptrends: price and the price relative. Price, of course, can be a line chart, bar chart or candlestick chart. Stocks hitting 52-week highs are in clear uptrends and often leading the market. Bristol Meyers is one such stock because it hit a 52-week high in early June. In addition, the stock held just above the May lows during the June pullback. I view these May lows as "benchmark" lows that chartists can use to compare charts. Stocks holding above the May lows show relative chart strength. Stocks breaking their May lows show Read More 

Don't Ignore This Chart

North Atlantic Drilling Floats Above The Surface (NADL)

by Greg Schnell

North Atlantic Drilling (NADL) has been off a lot of the investing community's radar as it was such a beaten down stock in an area that everyone expects to stay bearish forever. But the stock has consistently climbed off the early 2016 lows and continues to have some of the best price action inside and outside the energy space. The SCTR moved up in early June and the stock continues to rally above the 200 DMA. The uptrend has started in Relative Strength and that continues to push higher. Today was a big push up of 15% so the stock is very volatile. Read More 

Don't Ignore This Chart

Kroger Follows Through on Engulfing Pattern

by Arthur Hill

Stocks were hit hard on Friday and again early Monday, but Kroger (KR) bucked the selling pressure with a bullish engulfing on Friday and further gains early Monday. Even though the overall trend for KR remains down, a double bottom could be forming as the stock gets its second bounce in the 34 area. The intermittent highs mark resistance at 37 and a close above this level is needed to confirm the double bottom. KR came to my attention because its SCTR surged over the last two days. This is because stocks tanked and KR bucked the selling pressure. KR is part of the consumer staples sector Read More 

Don't Ignore This Chart

Nordson's Selling On Friday Could Be An Opportunity

by Tom Bowley

After the stock market closed on May 23rd, Nordson Corp (NDSN) reported quarterly earnings results that absolutely blew away Wall Street's consensus estimates.  The next morning, as you might expect, NDSN shareholders were rewarded with a huge gap higher and continuing interest throughout the trading day.  Volume was the heaviest of the year but NDSN quickly became overbought and was in need of a pullback.  That's what we've seen and the selling intensified on Friday as NDSN simply became collateral damage from the Brexit results.  It's likely setting up a solid long Read More 

Don't Ignore This Chart

Pounding The Table, The Pound ($XBP) Broke Support

by Greg Schnell

The British Pound ($XBP) made historical lows this morning.  While this chart is trying to find support at the $136 level, there is no doubt that we are experiencing a moment in time that could mark a significant long-term trend change. This chart is very similar to the $CRB chart which also broke a 46-year support level earlier in the year. When big things change, it can mark historic turning points. From a macro perspective, we now have two charts that have snapped in 2016. The $CRB has rallied back above which is not a surprise.  As technicians, we Read More 

Don't Ignore This Chart

Broadcom Bouncing Off Gap Support

by Tom Bowley

Broadcom (AVGO) posted quarterly EPS in early June that topped Wall Street forecasts and the stock gapped higher from 155 to above 165.  Now, just a few weeks later, AVGO has returned to the scene of the crime, testing gap support and its rising 20 day EMA.  Volume has been much lighter on the retreat as well, setting up a possible long trade with a solid reward to risk.  Check it out: Heavy volume accompanied the most recent earnings-related gap higher and AVGO was very overbought on that push to the upside.  Since that time, the selling has relieved the overbought Read More 

Don't Ignore This Chart

London FTSE is the Best Performing European Index in 2016

by Arthur Hill

The London FTSE is still down year-to-date, but it is the best performing index in Europe for 2016. The PerfChart below shows year-to-date performance for nine European stock indexes. The London FTSE is in the middle (light blue) and down less than 1% this year. In comparison, the Madrid IBEX 35 (black), Portuguese PSI (teal), Swiss Market Index (purple) and Italian MIB (orange) are down double digits. The Netherlands AEX is the only European Index holding up this year because it is down just 1.30%.  The CandleClance charts below show the London FTSE Read More 

Don't Ignore This Chart

HOG Makes Big Relative and Absolute Moves

by Arthur Hill

Chartists looking for the movers and shakers of the day need look no further than the StockCharts home page. Tables for most actives and SCTRs can be found midway down on the left-hand side. These tables can be viewed by Top 10, Bottom 10, Top Up and Top Down (click column headings). I like to sort the large-cap SCTRs by Top Up to find stocks showing a burst of relative strength. Notice that there are links under each table to create PerfCharts, CandleGlance Charts or Relative Rotation Graphs (RRG) for the ten symbols.  I spotted Harley Read More 

Don't Ignore This Chart

Is The Viacom (VIAB) / Sumner Redstone Battle Investable?

by Greg Schnell

Viacom (VIAB) stock is in the crosshairs of the Sumner Redstone battle. With so many issues surrounding the stock, it seems to be a disaster in progress. This morning, Viacom announced that their third quarter earnings would come in below expectations, but the stock continued to rally. Let's look at the sentiment of investors. First of all, the SCTR has moved above 75 which is a flag pointing to outperformance. The Relative Strength in purple has broken the 1-year downtrend and is now starting to make 4-month highs. It is an important point on the chart today as the stock is trying Read More 

Don't Ignore This Chart

VIX Over 20 Can Be A Huge Problem

by Tom Bowley

The Volatility Index ($VIX) is often times referred to as the fear index and fear is a necessary component of bear markets.  So the recent surge in the VIX should not be taken lightly.  We can and do see the VIX spike quickly during bull markets - only to settle down shortly thereafter.  But a VIX above 20 is a common denominator of all bear markets.  Such markets require high levels of fear and the VIX is the tool I use to measure it.  Below is a monthly analysis of the VIX this century with the S&P 500 performance shown beeneath it: From the chart Read More 

Don't Ignore This Chart

Key Moving Averages Converge as Boeing shows Signs of Accumulation

by Arthur Hill

Boeing has been stuck in a trading range since late March and signs of accumulation suggest an upside breakout. On the price chart, notice that BA surged from the 102 area to 135 from mid February to mid March. The stock was certainly entitled to a consolidation after a 30+ percent advance. The 200-day moving average flattened in the middle of this consolidation and the 50-day moving average is also near the middle and flattening. It looks like Boeing is gearing up for a move here. But which way?   I added volume and On Balance Read More 

Don't Ignore This Chart

MeetMe (MEET) Makes A Move

by Greg Schnell

The dating stocks have been performing quite well recently. This week, MeetMe (MEET) is breaking out from a large base. Last month I featured Match.com (MTCH) as it was starting to perform better. Today, MeetMe broke out to new highs. This 7-year chart shows an annual trek to challenge the breakout level in the last 4 years. This week, it has finally broken through the ceiling. With only 2 days gone in the week, this stock is really accelerating on huge volume. It is already 50% above the average weekly volume. The Relative Strength in purple also broke to Read More 

Don't Ignore This Chart

Eurotop 100 Breaks Key Levels and Leads Lower

by Arthur Hill

Large-caps in Europe continue to underperform large-caps in the US and the EuroTop 100 ($EUR) is breaking down on the price chart. First, the price chart shows $EUR falling sharply from December to mid February and then recovering 50-61.8% of this decline with a bounce back to the 2700-2750 area. This bounce formed a rising wedge and the index then broke the wedge trend line in early May. Overall, the decline looks like the dominant price move and the wedge looks like a counter-trend advance (correction). The early May breakdown ended this counter-trend advance and signaled a continuation Read More 

Don't Ignore This Chart

Ligand's Bullish Wedge Touches Price Support

by Tom Bowley

Ligand Pharmaceutical (LGND) broke out above price resistance in April with solid volume confirmation.  But the stock was extremely overbought and in need of a pullback to unwind its momentum oscillators.  RSI had touched the 80s with stochastic elevated in the 90s.  LGND has lost approximately 12%-13% over the past six weeks as a bullish wedge has formed to drop the price back to price support from the April breakout.  Check it out: The black arrow now shows the RSI near 40 and stochastic at 24, a much better reward to risk entry point. Happy Read More 

Don't Ignore This Chart

Darden Restaurants (DRI) Hits New Highs

by Greg Schnell

Darden Restaurants (DRI) stroked a new high on Thursday's down day. The owner of Capital Grille, LongHorn Steakhouse and Eddie V's is continuing to outperform. The chart has a few nice traits on it that deserve mention. The SCTR has been in the top 25% for most of the 18 months shown. This continuous high level of performance is nice to see. The Relative Strength in purple has been trending up the last 6 weeks. Darden broke out to new highs this week and we can see it is really starting to pull away from the $64 level which was meaningful resistance through the last year. After Read More 

Don't Ignore This Chart

Amazon's Negative Divergence Could Spell Trouble

by Tom Bowley

Amazon.com (AMZN) has been one of the strongest performers in 2016 and just recently broke out on a relative basis vs. the S&P 500 when it impressed Wall Street with its latest quarterly earnings results.  But there are now a couple warning signs that indicate AMZN may be at or near a short-term peak.  First, its lastest price high has occurred with a lower MACD reading, a sign of slowing momentum.  The MACD, however, does not take into account volume so I prefer to see volume slowing on the breakout to confirm the weak momentum.  That's exactly what's happening Read More 

Don't Ignore This Chart

JO Makes a Big Jump

by Arthur Hill

The Coffee ETF (JO) is one of leading commodity ETFs this week with an 8+ percent gain in just three days. The chart shows JO trending lower from the October 2014 peak until the February 2014 trough. JO then surged with a sharp three week advance that exceeded 20 and then pulled back to the 18 area in April-May. It looks like this pullback is ending as JO surged above the mid May high and broke above its 52-week EMA.  The indicator window shows 26-week Aroon Up (green) and Aroon Down (red). Aroon Down crossed above Aroon Up in December and hit 100 Read More 

Don't Ignore This Chart

Corn (CORN) Looks Ripe For The Picking

by Greg Schnell

Corn is an interesting product. Normally associated with food, it has become a bit of an energy play for the ethanol component. Now that oil is rallying above $40, Corn (CORN) seems to be getting a bid. If you are interested in the commodities, there are lots of charts that are breaking out. Corn can be a leading indicator for agriculture as well. With the SCTR above 75, the downtrend in price being broken, and the MACD above zero, the technical indicators are looking very supportive of this move. The higher highs and higher lows in the price trend, as well as a move above the 40 WMA, all Read More 

Don't Ignore This Chart

Tesla Battles Key Moving Average as Momentum Improves

by Arthur Hill

Tesla was hit hard in early May, but the stock managed to reverse near the 50% retracement and a bullish wedge is taking shape near the 200-day simple moving average. The stock surged from 140 to 270 from mid February to early April. This was a 90% advance in less than three months. The stock was entitled to a correction and the decline to the 205 area retraced around 50%. This is normal for a correction and there are signs that the correction is ending.   Some encouraging signs are emerging as the stock broke above 220 in mid May and challenged the Read More 

Don't Ignore This Chart

Sina Might Be Best Internet Stock

by Tom Bowley

Sina (SINA) has just seen its SCTR rank break above 70 as its price has broken above multiple tops near 52.  Volume on the breakout was very strong, topping 3 million shares for the first time since July 2015.  Any period of selling or consolidation should hold support that now resides at the 52 level.  The rising 20 day EMA, currently at 50.28, would also provide support if the 52 level is lost.  Here's the visual: The move in the SCTR back above 70 (nearly 90 at the recent high) tells us that SINA is one of the better performing internet stocks.  The blue Read More 

Don't Ignore This Chart

XBI Biotech ETF Surges To Four Month Highs

by Greg Schnell

The Biotechs topped out almost a year ago. With all the new technology in cancer treatment, and a few biotech conferences next week, the rotation towards Biotech is in full gear. I have shown XBI here as it has a lot of volume, but some of the other ETF's including SBIO, IBB, CNCR are all in play. The new 4-month highs in RS is encouraging, but the SCTR is still pretty weak. The break above horizontal resistance at $58 is good with nice volume. Today the price action also broke through the downsloping trendline as it broke the horizontal resistance. A near-term test is the Read More 

Don't Ignore This Chart

Look To This Industry Group For Leadership

by Tom Bowley

The S&P 500 continues to battle overhead price resistance that's been well established since closing at its all-time high on May 21, 2015.  While a bullish advance typically requires strong and wide participation from many sectors and industry groups, there's one that I'm watching very closely. Internet stocks ($DJUSNS). There's a bullish ascending triangle pattern in play on its long-term weekly chart (not shown below) and a breakout on heavy volume would measure to the 1250 level.  Currently, the DJUSNS is at 1086 so that would represent an approximate rise of 15% from Read More 

Don't Ignore This Chart

Aroon Brothers Gear Up for a Signal in Oracle

by Arthur Hill

Oracle broke above its 200-day moving average back in early March and then pulled back over the last ten weeks. There are signs that this pullback is ending because Aroon Up just surged above Aroon Down. Developed by Tushar Chande, Aroon means "dawn's early light" in Sanskrit and this indicator pair can be used to get a jump on trend changes. There are many ways to use this pair and I relay on two steps for a bullish signal: Aroon Up crosses above Aroon Down AND Aroon Up hits 100. The indicator cross is the most frequent signal and the one most prone to whipsaws. Chartists can reduce Read More