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

What a Difference a Month Makes for Sector Performance

by Arthur Hill

The two sector Performance charts below show a rather dramatic shift in market leadership over the last two months. First, note that these PerfCharts are using the nine equal-weight sector ETFs. In contrast to the cap-weighted sector SPDRs, these equal-weight ETFs provide us with a performance picture for the "average" stock in the sector. The top PerfChart shows performance from October 12th to November 10th. Notice that technology (magenta) and energy (teal) are the clear leaders with the biggest gains (black arrows). In contrast, the consumer discretionary and finance sectors were down Read More 

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Freeport McMoRan (FCX) Solders A New 9-Month High

by Greg Schnell

Freeport McMoRan (FCX) hit new 9-month closing highs today. As a miner of Copper and Gold, the strong price action in the face of weakness in the underlying metals is a very bullish trait. When the stock is outperforming the base metal, that can be a very good signal. The last panel shows a breakout on FCX compared to Copper. The second last panel shows FCX compared to Gold. The last two big thrusts in the stock have broken relative performance trend lines. The SCTR is moving above 75 which suggests strong price action. The relative strength in purple to Read More 

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Ingersoll-Rand Surges off Support

by Arthur Hill

Ingersoll-Rand (IR) is showing renewed signs of life with a surge off support and two mini breakouts. Note that IR is part of the industrials sector and this sector is showing upside leadership with a 52-week high recently. First and foremost, Ingersoll-Rand is in a long-term uptrend with a 52-week high in October and a positive PPO(50,200,0). Note that the PPO(50,200,0) is positive when the 50-day EMA is above the 200-day EMA.  The stock fell quite hard from late October to mid November, but managed to find support near the August low and firmed into Read More 

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Intel Testing Key Short-Term Support

by Tom Bowley

On October 26th, Intel (INTC) posted quarterly earnings results and beat both revenue and EPS estimates.  It resulted in a very strong gap higher the next morning and then INTC continued rising, tacking on another 10% within a week.  But INTC became very overbought with an RSI above 90 and needed a pullback.  Since topping in early November, INTC has lost close to 10% and is now testing the top of gap support and its rising 50 day SMA: The RSI has fallen back into the 40s (black arrow) and that's typically a level where we see prices turn higher again in an uptrend Read More 

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The View Gets Clearer for Valeant (VRX)

by Greg Schnell

The view for Valeant (VRX) improved substantially this week as the stock broke out of a well-defined base. From a  technical analysis perspective, this is a text book breakout. The stock has based by building a one year range. The new 52-week high broke out of the base this week. The view is a little clearer now for the owner of Bausch and Lomb eye care products.  The SCTR has surged to 99. The moving averages are in the proper alignment with the 10-week moving average above the 40-week. The volume surged on the breakout which is what we want to Read More 

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Here's A Pharma Printing A Hammer After Filling Gap

by Tom Bowley

I'm constantly looking for short-term trading opportunities and Perrigo (PRGO) fits the bill.  After reporting better-than-expected results in its latest quarter, PRGO gapped up strongly and today filled its gap before finishing on a solid note to print a hammer (blue circle below) - many times a signal of a bottom after a downtrend.  Reported revenues of $1.23 billion easily exceeded expectations of $1.17 billion.  In addition, EPS of $1.39 blasted past the $1.10 consensus estimate.  Now the issue is whether PRGO can overcome a very weak Read More 

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United Technologies Forms Classic Continuation Pattern

by Arthur Hill

United Technologies (UTX) looks ripe for a breakout to new highs as a bullish cup-with-handle pattern takes shape. Note that UTX is in the industrials sector and the defense-aerospace industry group. The Industrials SPDR (XLI) and the iShares Aerospace & Defense ETF (ITA) both hit new highs on December 1st. The chart shows UTX in a long-term uptrend because it hit a new high in July and the 50-day EMA is above the 200-day EMA. It looked like the stock was breaking down with the gap-plunge in early September, but this turned into a high-volume selling climax. The September low marks the Read More 

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Clorox (CLX) Makes Fresh New Highs

by Greg Schnell

Clorox broke out on Monday to news highs and continued the move today. With the rotation from growth to value or growth to defensive, this would fit right in. The SCTR is pushing into the top quartile, which I particularly like. The relative strength is improving, the news highs are bullish, the volume accelerated on the breakout and the MACD is pointing higher. All that to say the stock looks set up for a big move here. As long as it holds above $140, it looks like a nice breakout is in order. Good trading, Greg Schnell Read More 

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Mylan Continues its Move with Expanding Volume

by Arthur Hill

Mylan (MYL) was hit hard in early August with a plunge to 30, but firmed and recovered with a gap and surge to the upper 30s. The stock consolidated after this gap-surge and recently broke out with above average volume. Notice that the gap-zone held in the mid 30s as the stock consolidated in the 35-39 area. A consolidation after a sharp advance represents a rest that is needed to digest gains and alleviate overbought conditions. The consolidation did its job for eight weeks and ended with Friday's breakout. In addition to the breakout, note that upside volume outpaced downside volume over Read More 

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Shake Shack Starts Shaking (SHAK)

by Greg Schnell

Shake Shack (SHAK) started shaking this week. The stock made new 16 month highs today. This surge above a well defined base is very bullish. The SCTR is pushing back up above 70. The 10 week moving average has moved above the 40 week moving average. The price has broken above significant resistance, going back to August of 2016. The MACD is going positive and is at the highest level since the first few months of trading. This is a great base. This base is very similar to Facebook (FB) in 2012 and Alibaba (BABA) in 2016. The ultimate move might not be the same Read More 

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