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Chevron Leads Energy Sector with Breakout $CVX

by Arthur Hill

Chevron appears to be ending its correction and resuming its bigger uptrend with a five-day surge and breakout. The stock surged to a 52-week high in December and then retraced 61.8% of the prior advance with a decline into April. The decline basically ended in April because the stock found support in the 103 area from April to July. Notice that the broken resistance zone turned into a support zone - and held. The retracement amount and return to broken support are normal for corrections. Price action is turning bullish again as the stock broke above the June high and the 50-day EMA moved Read More 

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The Best Industry Within The Best Sector Awaits Its Next Breakout

by Tom Bowley

You might find it surprising, but healthcare (XLV, +15.51%) has posted the best six month performance among all sectors - even technology (XLK, +14.10%).  All five industry groups within healthcare have gained 10% or more in the past six months with medical supplies ($DJUSMS, +23.32%) leading the pack.  The DJUSMS has been consolidating this summer, but just bounced off of price support and its 50 day SMA and appears poised for another upside run: The consolidation has allowed the extended MACD to return closer to centerline support and the overbought RSI to dip back to a Read More 

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Scott's Fertilizer $SMG Is Top Dressing The Chart

by Greg Schnell

Scott's Fertilizer (SMG) has been hyped as a marijuana-related play for all those investors interested in the Cannabis trade. But even for non-cannabis focused investors, Scott's has some real nice seasonality that might make an excellent topdress to help green up your portfolio. Here is a link to the seasonality chart below. Notice the strong performance in the second half of the year. The actual stock chart looks equally compelling. A breakout above the $97 range would suggest $110-$112.  With the seasonality for Read More 

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Tractor Supply May Have Set A Bottom

by Tom Bowley

The NASDAQ 100 has been quite strong in 2017, but it's not because of Tractor Supply's (TSCO) performance.  TSCO had lost one third of its market value from the beginning of the year through early July, but a positive divergence emerged and that suggested that downside price momentum was slowing.  Thursday's action was quite bullish with TSCO breaking above its 50 day SMA on very heavy volume.  Check it out: When a company drops a bombshell - and missing both top line and bottom line estimates certainly qualifies - and the stock price reacts the way that TSCO's did Read More 

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Illumina Makes a Bid to End its Correction

by Arthur Hill

Biotech stocks are leading the market with the Biotech iShares (IBB) and Biotech SPDR (XBI) hitting 52-week highs this week. Even though Illumina (ILMN) is lagging its benchmarks a bit, it is firming at support and could be poised to end its correction. The chart shows ILMN advancing from 120 to 190 and forging a massive gap in January. A stock is entitled to a rest or correction after such a move and I view the decline back to the 165-170 area as a correction within a bigger uptrend. Notice that broken resistance turned into support in this area as the stock bounced in mid June and firmed Read More 

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Morgan Stanley (MS) Rings The New Highs Alarm

by Greg Schnell

Morgan Stanley (MS) has been consolidating for a while, but today, the stock broke out to new highs. The chart looks great with the SCTR moving into the top quartile and the Relative Strength is moving to new highs. The price exceeded the March highs after forming a nice consolidation panel. The MACD is making higher highs which also bullish. There is lots to like about this chart as the asset managers continue to roar. Good trading, Greg Schnell, CMT, MFTA   Read More 

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The Ultimate Software Group (ULTI) Consolidates

by Greg Schnell

The Ultimate Software Group has been working into a major consolidation over the last year. On Friday it pushed to a new intraday high, and today it is trying to push higher again. This mid-cap stock has light volume around 250,000 shares on average, but at $220 / share, that removes a lot of traders. The SCTR, the Relative Strength and the price action all suggest this chart is trying to break out to the upside. It made its 2016 high in August, so I don't have an answer if that is its seasonal peak, but I would suggest keeping this one on your radar. A breakout here would Read More 

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Biotechs Surge Again To New Highs

by Tom Bowley

Biotechnology stocks ($DJUSBT) are among the best performing stocks since the beginning of June with an approximate 16% gain over the past seven weeks.  It's not unusual for biotechs to remain on a tear for an extended period of time so pullbacks should be considered for entry.  The rising 20 day EMA is one such level to consider after a bout of selling as the weakness from late June into early July demonstrated.  Check it out: The group is in breakout mode again with signs pointing to higher prices ahead.  However, the DJUSBT is overbought once again so consider an Read More 

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Which metals hold the most value at the moment?

by Julius de Kempenaer

The above Relative Rotation Graph holds the main commodity groups (BCOM family) and uses the Bloomberg Commodity Index as the benchmark. The opposite directions in the rotations of Industrial metals ($BCOMINTR) and Precious metals ($BCOMPRTR) stand out for me. As they are both on the right-hand side of the graph we can conclude that the relative trend against $BCOMTR is positive. If you open up the live version of the chart and scroll through time you can see that Industrial metals rotated through weakening and have just turned up and crossed back into the leading quadrant Read More 

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Adobe (ADBE) Processes New Highs Again

by Greg Schnell

Adobe (ADBE) continues to find new ways to hit the new highs list. Recently I have been using some of Adobe's online forms and have been amazed by all the interesting software application techniques. The stock move suggests I am not the only one noticing something in Adobe's software. After consolidating for 2-months, the stock is pushing to new highs on a flat day for the overall market. The SCTR ranking continues to power on, suggesting ADBE is stronger than most stocks in the market. While the summer volume is a little light, it was that way for all of Read More 

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Hortonworks (HDP) Hears The Howl Of Fresh Highs

by Greg Schnell

HortonWorks (HDP) had its initial public offering a few years ago. The first year was a sell off, the second year built a base and in May, HDP broke out to fresh 52-week highs for the first time ever. After consolidating around the breakout level of $12.85, this morning HDP broke out from the consolidation. As technology has been leading for a while, this stock has been climbing since October. It is still just over 50% of the IPO price so there is a considerable distance to get back to the initial price of the offering. Good trading, Greg Read More 

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Texas Roadhouse Might Whet Your Appetite

by Tom Bowley

When money begins rotating to defense in a big way, I look for topping patterns in the market.  But when we're in the midst of a full-fledged bull market - as we are now - I'd much rather search for stocks in bullish continuation patterns.  That brings me to Texas Roadhouse Inc (TXRH).  There is lots to like here, besides the food.  Below features a very strong ascending triangle pattern on TXRH: The recent equal price highs and rising price lows establish the key points in this ascending triangle pattern.  A high volume price breakout above 51.50-52.00 would Read More 

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Xylem (XYL) Breaks Out To New Highs

by Greg Schnell

Xylem (XYL) specializes in water technology and spent this week pushing to new highs. This breakout looks good as it moves above a zone of resistance that has been in place for nine months. What I like most about the chart is the breakout comes after consolidating major gains from early 2016. Water is a growth industry and this chart looks set up to perform. I posted a Commodities Countdown video this week with some ideas around Commodities. It might be one of the best months to start getting involved in Commodities. Read More 

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A FOREX pair trade idea from Relative Rotation Graphs

by Julius de Kempenaer

The Relative Rotation Graph above shows the relative rotation, on a weekly basis, for the G10 currencies using the USD as the base. For a better understanding of how to use RRGs to monitor currency rotation please refer to this blog article on the subject. Looking at the RRG above there are two things that catch my eye. The first thing is the fact that ALL nine currencies on the RRG canvas (the USD is the tenth currency and the base/benchmark for this RRG) are positioned on the right-hand side of the plot indicating general weakness for the USD against all other Read More 

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Expeditors International (EXPD) Keeps The Wheels Rolling

by Greg Schnell

Expeditors International (EXPD) is a Large-Cap stock with a consistent chart pushing to new highs year after year. With all the attention to charts that swing and sway, this one seems to have a consistent trend of delivery shareholder profits. While its not a rapid rise in capital, the SCTR shows it to be a middle of the pack stock with readings between 30-70. This week the stock looks to be breaking to higher highs. With a weekly trading volume average of 5 Million shares, there is enough liquidity. The volume the last two weeks have been a little light Read More 

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Lithium ETF (LIT) Gets A Spark At 10 WMA

by Greg Schnell

The Lithium ETF has been climbing for a while, but recently it broke above some significant long term resistance. The chart is breaking out above the 4-year base at $28 and the current bounce looks set to push it to new 5 year highs leaving the base behind. Whether you use a Head/Shoulders base at $26 or the broader top at $28, this looks like it plans on continuing. Of course, Lithium is required in electric batteries. With all of the Tesla publicity, and all of the car companies trying to use the word 'Electric' in every marketing sentence, it seems natural that this continues to Read More 

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Life Insurance Index Breaks To All-Time High; Check Out This Stock

by Tom Bowley

Higher treasury yields ($TNX) are feared in some parts of the stock market like utilities (XLU), but not in others - especially in banking ($DJUSBK) and life insurance ($DJUSIL) where profits tend to soar during periods of rising interest rates.  The recent spike in the 10 year treasury yield ($TNX) from 2.10% to 2.40% has lit a fire under both of these industry groups and, given the Fed's desire to unwind its bloated balance sheet and to stay ahead of potential inflationary fears, I see the TNX rise continuing.  That should bode well for the DJUSIL, which broke out last week to Read More 

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Healthcare Is Entering A New Period Of Relative Strength

by Tom Bowley

Bull markets are comprised of rotating sector strength and bullishness.  On a relative basis, healthcare (XLV) was a laggard during 2009 and 2010 before outperforming in a major way from 2011 through 2015.  The sector saw relative weakness for nearly two years beginning in mid-2015, but has now resumed its relative strength.  In fact, I believe the breakout above relative downtrend resistance marks the very early stages of another relative push higher in healthcare stocks, particularly biotechnology stocks ($DJUSBT).  Take a look at the chart: You should Read More 

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Goldman Goes for a Breakout $GS

by Arthur Hill

Goldman Sachs (GS) appears to be ending its correction as it bounces off the rising 200-day moving average. The chart shows GS hitting a 52-week high in March and then declining into June. I consider this a correction because the stock was entitled to a pullback after a massive advance and it retraced around 38.2% of the prior move. Goldman found support near the rising 200-day SMA and turned up the last six weeks with a move back above its 50-day SMA. A move above 230 would break a resistance zone and argue for a challenge to the March high. The indicator window shows the price relative Read More 

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A Bullish Failure Swing for RSI on XLE

by Arthur Hill

The Energy SPDR (XLE) continues to firm after an extended decline and RSI could trigger a bullish signal this week. On the price chart, XLE shows signs of stabilization with an outside reversal five weeks ago and an inside week last week. Notice that XLE is firming near support from last summer's lows and near the 50% retracement. XLE bounced early this week and move above 67.5 would trigger a breakout.  Momentum is improving as 10-week RSI traces out a possible bullish failure swing. Developed by Welles Wilder, the creator of RSI, the bullish failure Read More 

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Semiconductors: Goodbye or a Good Buy?

by Tom Bowley

The Dow Jones U.S. Semiconductors Index ($DJUSSC) is an extremely volatile index.  When this index is trending higher, there aren't too many better places to be invested.  But when the fire goes out, you want to run, not walk, for the exits.  So where are we now, after a month of blood-letting in the space?  Should we be entering or should we be running away? Well, first let me say that the group needed a breather, by just about any measure.  From its low in mid-April, the DJUSSC gained roughly 17-18% in the next eight weeks.  That's a serious move Read More