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About this blog: is our free newsletter for individuals interested in technical trading and chart analysis. It is sent out twice a month via email. This blog contains early-access, preview versions of the articles that later appear in the official newsletter.

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ChartWatchers

Staying on the Right Side of the Market

by Arthur Hill

The first rule of trading is to stay on the right side of the broad market trend. There are different indexes and indicators we can use to determine the broad market trend, but few are as efficient as the S&P 500 and its 12-month EMA. The chart below shows monthly bars for the S&P 500 with the Percentage Price Oscillator (1,12,0), which measures the difference between the 1-month EMA and the 12-month EMA. Note that the 1-month EMA is essentially the monthly close. The long-term trend is up when the PPO is positive and down when the PPO is negative. Showing the PPO as a histogram Read More 

ChartWatchers

Cash Flow Stocks Break Out

by Greg Schnell

Investors in growth stocks had another troublesome week. The bifurcation continued as the NASDAQ 100 $NDX breadth data had a tough week while the $SPX breadth improved. Three stocks of interest showed up on the most active list for the $SPX to highlight the trend. Equifax had a data breach last year in September. While it has rallied well off the lows, this week it started to push above the resistance that has been in place since January.  With the SCTR moving above 80 and the MACD turning up while staying above zero, this looks like a good momentum move. Equifax Read More 

ChartWatchers

Life After Earnings

by John Hopkins

Q2 Earnings season has come and gone with the overall market response being mostly positive. And the good news for traders is there are plenty of companies that beat expectations, made nice moves higher and could become high reward to risk trading candidates on pullbacks. As just one example, take a look at the chart on GrubHub, a company that reported their numbers on July 24 and easily beat earnings and revenue expectations;     You can see from the chart above that the response Read More 

ChartWatchers

Stocks in Strong Rebound After Surviving Test of 50-Day Averages Yesterday

by John Murphy

Editors Note: This article was originally published in John Murphy's Market Message on Thursday, August 16th at 2:12pm ET. U.S. stock indexes are having an unusually strong day. Chart 1 shows the Dow Jones Industrial Average climbing more than 400 points (1.6%) in afternoon trading. The Dow tested its 50-day average yesterday and held. Chart 2 shows the S&P 500 trading 1% higher. Yesteday's pullback held above its June peak and 50-day average as well. Chart 3 shows the Nasdaq Composite Index also holding above its 50-day Read More 

ChartWatchers

Capturing the US stock market from different angles using Relative Rotation Graphs

by Julius de Kempenaer

Instead of showing asset class rotation or sector rotation, Relative Rotation Graphs can also be used to show rotation among various market segments. You have all seen or heard about a breakdown of the market in large-, mid-, and small-cap stocks. And maybe also the breakdown between growth and value stocks. The stock market can be seen from a lot of different angles. The good news is that index providers like Dow Jones are providing us with indexes that capture all these different market segments. In this post, I want to show you how you can use Relative Rotation Read More 

ChartWatchers

Are Railroads Still Rolling In Profits?

by Greg Schnell

Just a reminder, I am the opening speaker kicking off Chartcon 2018 on Friday morning, August 10th! DON'T BE LATE! I hope to be one of the strongest presentations to kick this off. While I love the SCTR, my presentation this year will be a totally different method of simply finding great set ups based on some of the biggest names in Technical Analysis. I am up against some fabulous speakers so I have my work cut out for me.   Seriously, when do you get to hear published authors Martin Pring, David Keller, Greg Morris, Alexander Elder, John Murphy, Arthur Hill, and Greg as Read More 

ChartWatchers

The Question Rarely Addressed - When Do I Sell?

by Tom Bowley

Buying is so easy.  When you pull that trigger to buy, optimism abounds.  Maybe it was a recommendation from a friend.  Perhaps there was water cooler talk of the next Apple (AAPL).  You might even have uncovered it from a time-tested scan.  The reason doesn't really matter.  The bottom line is you believe the stock just purchased is going to make you money.  It might.  It might not.  The bigger question is have you thought about when you're going to sell. Keep in mind that I write this blog article from a short-term trader's Read More 

ChartWatchers

Relative Rotation Graphs can show (much) more than just equity sectors

by Julius de Kempenaer

Relative Rotation Graphs are a great tool to visualize equity sector rotation and they are probably most used for that purpose. However, there are many more areas where RRGs can be used to get a big picture view of what is going on among a group of securities or related financial instruments. Commodities One of these areas is commodities. Here at Stockcharts.com commodities are regularly commented on by Greg Schnell, among others, who even has the commodities countdown blog, dedicated to the commodity markets. As there are many commodity-related indices Read More 

ChartWatchers

Finding Leading Stocks in Strong Uptrends (Trend Following)

by Arthur Hill

Trend following strategies are built on the premise that trends persist and we can make money by simply following the trend until it ends. There will be losers along the way, but a few strong trends will more than make up for the losses. It sounds great in theory, but putting it into practice is, of course, another matter. The first step to trend following is finding strong uptrends. As far as stocks are concerned, we should also focus on leading stocks. Thus, we need an indicator that captures strong trends and upside leadership. Enter the humble Price Channel, also Read More 

ChartWatchers

Selling in China Unsettles Global Stocks This Morning on Tariff Threats -- But US Stock Indexes Are Recovering from Early Selling

by John Murphy

Editors Note: This article was originally published in John Murphy's Market Message on Thursday, August 2nd at 1:43pm ET. TARIFF THREATS PUSH CHINESE MARKETS LOWER Threats of higher tariffs on Chinese imports, combined with Chinese threats of retaliation, put international markets on the defensive today. It started in Asia, spread to Europe, and caused a lower stock opening here. China took the biggest hit. The red line in Chart 1 shows the Deutsche X-Trackers CSI 300 China A-Shares ETF (ASHR) falling more than 2% today to the lowest close in more than a year. That helped pull Read More 

ChartWatchers

Fundamentals: Market Still Extremely Overvalued

by Carl Swenlin

What's a technical guy doing talking about fundamentals? Well, I believe that charts of fundamental data are as useful as price charts in helping us visualize fundamental context and trends. In the case of earnings, the following chart shows us where the S&P 500 would have to be in order to have an overvalued P/E of 20 (red line); fairly valued P/E of 15 (blue line), or an undervalued P/E of 10 (green line). I have added three hash marks on the right side of the chart to show where the range will be at the end of this fiscal year based upon earnings estimates for 2018 Q4. Read More 

ChartWatchers

You're One Week Away From The Two Most Transformative Days Of 2018

by Grayson Roze

Hello Fellow ChartWatchers! Can you believe that we’re just ONE WEEK AWAY from ChartCon 2018? Our 5th online investing conference goes LIVE on the morning of August 1oth at 10:00am ET, and I can hardly contain my excitement. The presentations have been sent in, our bonus videos are ready to go, and the speakers start arriving in Seattle this weekend. In short, we're ready to bring you two of the most transformative, inspiring days you can imagine. Now that we’re only a few days away from the conference, our Support Team has been receiving plenty of Read More 

ChartWatchers

This New Behind-The-Scenes Video Perfectly Captures The ChartCon Spirit

by Grayson Roze

Hello Fellow ChartWatchers! In case you missed it, we just released a special behind-the-scenes video that I want to make sure you see. I can hardly believe that ChartCon 2018 is now only TWO WEEKS AWAY, but watching this video really made it feel even more real. Last week, while filming bonus content for the conference, we had a chance to sit down with a few of our featured speakers and talk to them face-to-face about ChartCon. We asked what we thought were a few simple questions like, "What are you most excited for about ChartCon?", but the totally unscripted Read More 

ChartWatchers

Stubborn Weekly Momentum SELL Signals SPX and Dow

by Erin Swenlin

My expectation for week end was two new weekly PMO BUY signals. Instead we got only one. The SPX missed its weekly PMO BUY signal by hair or technically, by two one-hundredths of a point. The OEX managed to squeak its out and the Dow is finally seeing a possible weekly PMO bottom. The NDX is just sitting back and waiting for everyone to catch up. It's been on a weekly PMO BUY signal since mid-June. The OEX is attempting a breakout above resistance from the February/March top. It managed to hurdle the 2nd quarter top last week but pulled back slightly to close just Read More 

ChartWatchers

The Big Start To Earnings Comes Out Flat

by Greg Schnell

The US earnings season is in full bloom with major corporate earnings announcements flowing. The earnings have come out just fine, but it seems investors had already figured that out. This week the market is flat with a doji candle. What brings this doji to my attention is that it showed up while we were trying to make a convincing break above 2800.  There has been a lot of talk about the FANG leadership and the heavy weighting they have on the index. The bottom line is the NASDAQ 100 ended the week with a slight negative which is hardly the resounding Read More 

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