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

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 

Don't Ignore This Chart

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 

Don't Ignore This Chart

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 

Don't Ignore This Chart

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 

Don't Ignore This Chart

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 

Don't Ignore This Chart

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 

Don't Ignore This Chart

Which Way Will The Bond Market Turn On Fed News?

by Greg Schnell

The bond market has narrowed itself into a tight range. Below is the TLT chart, with the yield payments removed from the price action. This chart allows us to see how the price is moving, and right now it is sitting at a particularly interesting junction. Bond prices started to rise after the Fed meeting on November 7-8th and have continued to rise since, but they now face an important decision point. Let's walk through what the chart is telling us. In a down market, the weekly RSI has trouble rising above 60. Back in March (2019), the market players pushed the RSI to Read More 

Don't Ignore This Chart

Palo Alto Readies for its Next Move

by Arthur Hill

Palo Alto Networks (PANW) is a leading cyber-security stock that fits into the technology sector. Needless to say, the Technology SPDR (XLK) and the EW Technology ETF (RYT) are the leading sectors here in 2019. PANW took a break with a consolidation over the last eight weeks, and this could be the pause that refreshes. First and foremost, PANW hit a new high in early March and is well above the rising 200-day SMA. The long-term trend is clearly up. The stock is also a leader in 2019 because it recorded a 52-week high this year. The stock surged Read More 

Don't Ignore This Chart

XLV Gets An Injection

by Greg Schnell

The Healthcare sector recently broke to 2019 lows. Does that make the sector a don't-touch, even as the market makes all-time highs? Well, this week's price bar looks like a strong bounce off a three-year support line. With that as a backdrop, the chart provides some more information that suggests this is a tradable low, with support nearby to shoot against. The Pros: Healthcare's SCTR ranking is at its lowest point in 5 years. It does not usually stay down at this level, but it will have to start outperforming to climb back up past how other ETFs are performing. Because Read More 

Don't Ignore This Chart

Party Like It's 1999 for QCOM

by Julius de Kempenaer

Technology is doing very well on the Relative Rotation Graph for US sectors, with a rotation that is well inside the leading quadrant and pushing further into it. If we shift gears and look specifically at the RRG for the technology sector (against XLK), we can see there is one tail that firmly stands out: QCOM. At present, QCOM has a long tail inside the improving quadrant, traveling at an RRG-Heading between 0-90 degrees, and is close to a crossover into leading. With all that going for it, this chart definitely seems to be worth a look Read More 

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