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The 40 Week Moving Average Turns Down Again $SPY

by Greg Schnell

The SPY is a tracking ETF for the S&P 500. What that means is that SPY represents the price action of the $SPX; in fact, it actually outperforms the $SPX, as investors holding the SPY also get the dividends. The rising purple area chart below shows the SPY outperforming the $SPX, which is due to the dividend. Looking at the weekly RSI, we have dipped below 50, which is bearish. In bull markets, we would expect this to bounce near the 40 level. The real problem is that the big push down in December to 30 suggests we have started a bear market. The recent rally almost got to 70 Read More 

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Did We Just Complete a H&S Top In $SPX?

by Julius de Kempenaer

It seems I did not have to look very far to find today's DITC entry The S&P 500 ($SPX) provides enough ammunition to get excited - or maybe worried is a better word - and not ignore the price action that is unfolding at the moment. Looking at the 6-month chart of the index, the contours of a head-and-shoulders top formation can be distinguished. Is it a perfect H&S? Probably not. Does it have enough validity to not be ignored? Definitely. The rally out of the December low ended at the high on the 1st of May, when a more Read More 

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Cardiovascular Systems Breaks from Pennant

by Arthur Hill

Cardiovascular Systems (CSII) shows bullish price action with signs of accumulation that could lead to higher prices. First and foremost, the long-term trend is up because CSII recorded a new high in early March and is above the 200-day SMA. The 50-day SMA (green) is also above the 200-day SMA (red). After hitting a new high, the stock fell back to the 200-day SMA in April and even gapped lower on April 11th. This gap did not last long as the stock surged above 40 and filled the gap. This surge also put the stock back above its 50-day and 200-day lines. Read More 

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AMD Bucks The Trend

by Greg Schnell

Semis have been getting short-circuited lately. The $SOX chart looks abysmal. However, the chart of AMD continues to hold up in the face of industry weakness. When a stock refuses to be beaten down with the rest of the group, this is indicative of clear investor interest. The broad market is overwhelmingly weak, with more and more information coming out about big slowdowns. According to my Twitter feed today, these numbers are not just weak, they're aggressively weak.  If the overall market pulls back, it will be hard for AMD to keep going up, but, if it just Read More 

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Coty Gets Better Looking (COTY)

by Greg Schnell

The four-year chart for Coty (COTY), a consumer staples fashion house, has not been one of beauty; rather, it looks like ten miles of bad road, as dad used to say. This month, though, something happened that changed the trend and put lipstick on my interest in the stock. Let's walk through the indicators together.  First of all, the SCTR surged early in the new year and pulled back. One-time surges can and do happen; it is the second trip to the top area that tweaks my interest. This is a bull trait. Some interest shows up, the stock relaxes, then interest Read More 

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Is China About To Pick Up The Pace Again?

by Julius de Kempenaer

Yesterday, I wrote about the relationship of US stocks against other international stock markets in my regular RRG Charts article. The Relative Rotation Graph that I use for these analyses is one of the pre-defined groups and is shown above. While working on that article, I noted the long tail and the hook down on the Chinese market index $SSEC. Afterwards, I decided to make that chart today's chart to not be ignored. Resting At Support Levels Near 50% Retracement The Chinese Read More 

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A Medical Device Stock with Strong Volume Trends

by Arthur Hill

An existing uptrend and short-term breakout on high volume point to higher prices for Boston Scientific. The chart below show BSX hitting a new high in early March and then falling rather sharply into mid April. A volume spike punctuates the plunge below 35 and this looks like a selling climax that washed out most the sellers. The stock then recovered with a move back above its rising 200-day SMA and I think the long-term uptrend remains intact. Short-term, the stock moved above its 200-day in late April and then corrected into mid May with a Read More 

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Could GoPro Go? Yes It Could Go! GPRO

by Greg Schnell

GoPro (GPRO) is a classic IPO that initially traded with a lot of hype before ultimately losing its mojo. The stock IPO'd almost 5 years ago and has been in a big slide ever since. However, there's now a big reason for you to put GPRO on your radar, which is that the stock actually made new 52-week highs in May - the first time that has happened in its life! Is the GoPro finally ready to run?  The SCTR for GPRO has just pushed to its highest level since shortly after its IPO, which suggests excellent price strength. Due to the big Read More 

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A Momentum Break for Ross Stores

by Arthur Hill

Ross Stores (ROST) recently bounced off its rising 200-day SMA with a bullish candlestick pattern and short-term RSI broke to its highest level of the month. It looks like the short-term pullback is ending and the bigger uptrend is resuming. ROST plunged in November-December with a sharp decline below the 200-day SMA. This plunged caused the 200-day to flatten in December, but it never really turned down. ROST quickly rebounded in January with a move back above the 200-day and the 200-day is back on the rise. Short-term, the stock edged lower Read More 

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Walmart Fires Up The Jet $WMT

by Greg Schnell

A few years ago, Walmart bought Jet.com, an online retailer. It was a big purchase of an unprofitable retailer, but the expertise of the online platform management was part of the action. On that note, Walmart reported strong earnings numbers yesterday above street expectations, crediting their online initiative for the growth. (The revenues were a touch light.) Walmart has allowed the online unit to really get rolling, which bodes well for management as acquisitions can die in large companies. I guess you could say they fired up the jet! But can it lift the stock to new Read More 

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Will this break in IEF be able to hold up?

by Julius de Kempenaer

Browsing some Relative Rotation Graphs, the relationship between Stocks and Bonds once again drew my attention. When I shifted to their respective charts, I decided that the current price action of IEF, as shown in the graph above, deserves our (or, at least, my) attention. This ETF, which tracks the performance of 7-10 year Treasury bonds, broke above an important horizontal resistance level (106.50) three days ago. It then hovered above that breakout level the day after the break, before then jumping to a high of 106.97 yesterday. Read More 

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Is GE for Real This time?

by Arthur Hill

General Electric (GE) is one of the worst performing stocks over the last two years, but the stock is perking up in 2019 and outperforming in May. The S&P 500 is down 3.8% so far this month and GE is up 1.5% after a big surge on Tuesday. GE is trying to reverse the long-term downtrend with a move above its 200-day SMA over the last two weeks. The stock broke above this key moving average with a gap up on April 30th and is largely holding above the SMA. The moving average, however, is still falling. The chart sports a bullish reversal pattern Read More 

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Is This Defense Stock Preparing For Take Off?

by Greg Schnell

In a market with 240-point swings based on 240-character tweets, it can be pretty hard to pick a direction. While the market churns through this current trade debate, we have a few more such debates on tap with Europe and Japan. As car tariffs with Europe could potentially start this weekend, the uncertainty looks set to continue.  With all this going on, it makes sense to try insulating our portfolios with some stocks that might not be trade-related. One suggestion might be the defense stocks. While the market has pulled back from May Read More 

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AMD Holds Up Well with Semiconductor Group

by Arthur Hill

The S&P 500 was down 2% last week and the Nasdaq fell 3%. Stocks that gained on the week showed relative and absolute strength. Stocks that fell less than 2% showed relative strength. The average semiconductor stock within the S&P 1500 was down 5% last week with only 3 of 46 closing higher. AMD did not close higher, but it fell less than 1% and held up much better than the group as a whole. DIOD and QRVO also held up well and have interesting charts. The table below shows the top 12 peforming semiconductor stocks last week. Only three were up and nine were down.  Read More 

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Aflac Is Unflappable $AFL

by Greg Schnell

With all the news this week regarding trade, some stocks just quietly fly under the radar. This week, it was Aflac (AFL). While the market made lower lows almost every day this week, Aflac made its lows on Monday and its high on Friday. I like seeing that relative strength. The SCTR suggests AFL is a top performer, moving above 75. While Aflac usually performs in line with the $SPX, it recently pushed up in relative strength. If the market needs more time to be defensive here, this chart looks like a stable theme. I like seeing the PPO momentum indicator turning up after bouncing Read More 

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Strong Rotation For AXP on RRG vs DJ Industrials

by Julius de Kempenaer

Watching the Relative Rotation Graph for the DJ-Industrials universe, you can see a few stocks, like AAPL, BA and WBA, that stand out immediately. Despite the current setback in the market, there are still some stocks that are worth approaching from a buyer's perspective. Inside The Leading Quadrant and At Strong Heading One of these positive exceptions is AXP. You need to zoom in on the RRG to find it, as the area around the center of the chart is a bit crowded.  The best way to do that, IMHO, is to click "fit" to make the RRG use Read More 

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Micron Fails at Break Zone

by Arthur Hill

A basic concept of technical analysis is that broken support turns into future resistance. This concept is proving true for Micron (MU) as it returned to broken support in April and backed off the last two weeks. The chart shows MU breaking down with a support break in September and further weakness into late December. The stock recorded a 52-week low near 30 in late December and then rebounded to the 45 area by April. Even though a 50% advance off the lows is impressive, it retraced less than 50% of the prior decline and met resistance near broken support (blue zone). Also notice that Read More 

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Both Composite Indexes Stall At Resistance

by Greg Schnell

Looking at the broad composite charts below, we can see that both the Nasdaq and NYSE Composites are at important resistance points. The Nasdaq Composite is hovering at important technical resistance; the black line could be at 8100, but, by putting it at 8000, we can give it some wiggle room. This is after a huge thrust of 32% off of the December lows. The other major index is the New York Composite. Notice how important 13000 is for the $NYA. The New York Composite is a better index for warnings and is usually the first to break. The broad Read More 

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Ebay Holds the Gap and the Break

by Arthur Hill

Ebay (EBAY) reversed its downtrend with a reversal pattern and break above the 200-day SMA in late January and early February. After digesting its gains with a corrective pattern in March-April the stock broke out again with a gap and appears headed higher. The stock formed a rare island reversal from October to January. Notice how the EBAY gapped below 31 and continued lower in October. After consolidating for a few months, the stock gapped above 31 in January and continued higher. The gaps align to create an island where those with short positions are trapped with losses. Read More 

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Monster Beverage Pours An Earning Boost $MNST

by Greg Schnell

Monster (MNST) reported great numbers, beating on both earnings and revenue. What makes the chart valuable is that, after all is said and done, we can see that price is moving above the centre of the range. The real story here is that MNST has been flat money for the last 1.5 years. Also worth noting is the fact that the stock recently tried to break out, pulled back and has now relaunched.   While some of the mainstream stocks have garnered all of the attention, the technology names have underperformed over the last few weeks and defensives have Read More 

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Will JNJ Be Able To Pull The Sector Back On Its Feet?

by Julius de Kempenaer

The Healthcare sector is not in its best shape. On the Relative Rotation Graph for US sectors, XLV is deep down inside the lagging quadrant against SPY, without any signs of improvement at the moment. However, if you feel that this situation will not last forever and are gutsy enough to prepare a bit for a turnaround, you may want to look at JNJ. Price On the weekly price chart above, JNJ looks to be clearing horizontal resistance around $140. There are still two days left in the week, but things look good so far. The next Read More 

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Docusign Breaks from Consolidation Pattern

by Arthur Hill

Docusign (DOCU), a company that provides e-signature solutions, started trading on August 27th and surged over 30% on its IPO. The stock advanced another 65% after this initial gain and then fell back to the IPO price in October. Notice that the six month lockup period ended on October 24th and the stock established support in the 40 area the next two months. The stock moved higher in the first quarter and the chart looks bullish after a consolidation breakout in late April. Even though there is less than a year of price history, there is enough to form an opinion on Read More