Don't Ignore This Chart

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About this blog: The blog contains daily articles with intriguing or unusual charts selected by one of our Senior Technical Analysts, along with a short explanation of what exactly caught their attention and why they believe the chart is worth noting.

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Don't Ignore This Chart

Real(ly) Good Real-Estate (XLRE) But It Needs To Break Resistance

by Julius de Kempenaer

The Relative Rotation Graph for US sectors shows a remarkably steady rotation for the Real-Estate sector. This is a daily RRG showing a 15 day tail, or three weeks. Yesterday XLRE crossed over into the leading quadrant and is now the only sector inside the leading quadrant at a solidly positive RRG-Heading. Real Estate Select Sector SPDR Fund - XLRE The daily price chart for XLRE shows a steep rally from its late December low to current levels where it is running into overhead resistance. $34.10 (or $34.50 unadjusted) is the level to watch for a break higher. A Read More 

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Autozone Gets Back in Gear

by Arthur Hill

Autozone (AZO) is a leading stock because it recorded a 52-week high in December and remains above the rising 200-day SMA. The S&P 500, on the other hand, recorded a 52-week low in December and remains below its 200-day SMA. The chart below shows AZO with a falling wedge correction over the last six weeks. Even though this correction occurred when the S&P 500 moved higher, I still view it as a pullback within a bigger uptrend. The falling wedge is typical for a pullback within a bigger uptrend and the decline retraced around 50% of the prior advance. Think two steps forward and Read More 

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Is The Pressure Relief Valve Starting To Release? $SPX

by Greg Schnell

Well, what's it going to be - up or down? The market made its high on Options Expiration Friday and has been unable to take out that high for 6 days. With AAPL trading up in after hours and other tech names to report this week, will we be able to push through that high? The market is very sticky here. For technicians, the bright light we see ahead is a freight train loaded with resistance on daily and weekly charts. Fundamental investors, meanwhile, continue to see earnings downgrades. We have not had heavy volume on the selling days. However, the pressure got to me Read More 

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Another Gap for QQQ

by Arthur Hill

Last week (Monday) I featured an evening star reversal pattern in QQQ. This pattern did not foreshadow further weakness as QQQ firmed in the 161 area the next day and gapped up on Friday. This gap did not last long as QQQ gapped down on Monday morning and filled Friday's gap. We could probably call this an island reversal because the gap up and gap down match. Today's gap is still a work in progress and may or may not hold. Overall, QQQ has moved sideways the last eight days as two conflicting trends battle it out. Long-term, I think the trend is down because QQQ Read More 

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Bases Are Forming Inside The Great Wall

by Greg Schnell

There are a lot of bases forming currently inside the great wall of China. After suffering a huge downtrend, these charts are setting up for new buy signals each and every day. I'll be on StockCharts TV's MarketWatchers Live show (Monday, January 28th at noon ET) to talk about some of these setups, which have been particularly compelling given the recent pullbacks. Some have even started to move out of their bases with 10% moves each week! I want to give you an example of the kind of things that are starting to appear on these setups. Here is EDU, with Read More 

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Water ($DJUSWU) Is The Leading Group Inside The Utilities Sector (XLU)

by Julius de Kempenaer

One of the pages that I often visit on Stockcharts.com is the sector summary. It gives a tabular overview of the price changes that occurred over a certain period (you can choose). From that page, it is possible to open a Relative Rotation Graph that breaks the sector down into industries. This enables you to look inside the sector at the industry level and see which industries are driving or dragging the performance of the sector. To do that, simply click on the RRG icon (the four squares) at the end of the line. An RRG will open up, holding the industries Read More 

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A Rare Evening Star Forms in QQQ

by Arthur Hill

Despite a 15% surge the prior 17 days, the Nasdaq 100 ETF (QQQ) remains below its flattening 200-day SMA and the ETF formed a rare evening star candlestick pattern over the last three days. First and foremost, I think the long-term trend is down for QQQ. The ETF recorded a 52-week low in December and remains below the 200-day SMA. Even though a 15% advance is impressive, this advance is still in the shadow of an even larger decline (-16.9%). The early December high marks the last peak where the bulls lost control and a break above this high is needed to reverse the bigger downtrend Read More 

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Chipotle Fires Up The Mexican Grille

by Greg Schnell

Chipotle has been building a very large base over the last couple of years. With Tuesday's move, it is now trying to break out above the consolidation.  The SCTR has resumed its strong presence, while the relative strength in purple continues to run to the upside. The full stochastic is showing strength here as the price sits at the breakout level. One of the indicators I like the most here is the PPO, which is bouncing off the zero line after pulling back. This looks like a long runway for Chipotle. I think a tight stop in the high $480s should give it all the wiggle room you'd Read More 

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Can The Deere Start Running Again?

by Greg Schnell

There's been a nice surge in the Commercial Vehicles group over the past month. One of the leaders in the group is Deere & Co. (DE) which outperformed all of 2017 and consolidated through 2018. This week's price action on Deere looks like the highest weekly close in 9 months - and there are a few other technical clues that suggest there is more to come.  In November 2016, Deere broke out to a new 12-month relative strength highs compared to $SPX. That initial clue started Deere on a run, doubling the stock price. It continued to outperform - the SCTR ranking shows Read More 

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Long Tail And Strong RRG-Heading For IRM

by Julius de Kempenaer

The Relative Rotation Graph above highlights the rotation of IRM (Iron Mountain Inc.) in comparison to the other stocks in the S&P Real-Estate sector (XLRE). The sector itself is interesting to keep an eye on as it is positioned well inside the leading quadrant but rolling over, at high JdK RS-Ratio levels, on the weekly RRG. But it is inside the lagging quadrant and curling up on the daily RRG.  This setup suggests a longer-term (weekly chart) relative uptrend that goes through a pause/correction (daily chart). Assuming that the weekly trend is providing the Read More 

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