Money is rotating towards financial stocks as the market prepares for what appears will be Fed tightening later in 2015 into 2016. Higher yields on treasuries and a steepening yield curve generally increase net interest margin, the key metric in bank earnings. So traders are using this fundamental development to... READ MORE
A solid labor market had bond traders heading for the exits on Friday and that extended the recent surge in treasury yields. The 10 year treasury yield ($TNX) closed at its highest level since early October and that has many traders heading for the financial sector. While the financial ETF... READ MORE
Okay, I'm being a bit dramatic with this title because I'm not ready to throw the towel in on this bull market. But there are clearly warning signs technically that the next bout of rotation in the stock market could negatively affect the healthcare sector. As... READ MORE
JP Morgan downgraded Verizon (VZ) this morning, instead choosing AT&T (T) and that has put pressure on VZ in the early going. Thus far, buyers have emerged and VZ has risen off its opening gap lower. Technically, VZ is continuing its downtrend that it started just over a... READ MORE
If you know one thing about me, you should know that I'm a stock market historian. I've logged every day's S&P 500 activity onto an Excel spreadsheet since 1950. If there's a trend, I can tell you about it. So... READ MORE
Just a couple days after finally clearing two month resistance at 1950, the Dow Jones U.S. Semiconductor Index closed above 2000 for the first time in 14 years late last week. Semiconductors tend to move quickly in both directions so given the breakout, I'd be looking for... READ MORE
Apple (AAPL) is more than a $750 billion market cap company, by far the largest on the NASDAQ. Therefore, AAPL's price performance will have a rather significant impact on the overall performance of the NASDAQ as the NASDAQ is a market cap weighted index. In other words, AAPL&... READ MORE
ABIOMED (ABMD) has fallen much of the past three weeks after surging on better-than-expected quarterly earnings results on May 5th. ABMD posted revenues of 67.56 million in its latest quarter, easily surpassing Wall Street forecasts of 62.33 million. In addition, ABMD's EPS trounced estimates, .28 vs.... READ MORE
Gaps are strange creatures and knowing what to do after one is difficult because emotion does crazy things to our patience and discipline. Gaps 101 tells us that most gaps fill. What does that mean? Well, if ABC company closed yesterday at 10.00 and opened today at 11.00,... READ MORE
One of the advantages that the technical trader carries in his/her back pocket is the ability to visualize the future price action before it happens - based on the prior price action. Trending price action to the upside is generally followed by bullish continuation patterns. Periods of consolidation can... READ MORE
The Dow Jones U.S. Gambling Index ($DJUSCA) has been under pressure for quite some time with many gambling stocks under pressure as well. That has not been the case for Penn National Gaming (PENN), however, as it's been in an uptrend and has been a tremendous relative... READ MORE
We've been in a six year bull market where most stocks have been trending higher. But not every industry group and stock follows the primary trend higher. In fact, catching a falling stock just as it hits rock bottom can provide a big lift to your portfolio. So... READ MORE
Over the past month, the Consumer Electronics Index ($DJUSCE) has fallen close to 9%, which ranks it as the third worst performing industry group. Only gambling stocks (-12.64%) and business training & employment agencies (-15.68%) - two consumer discretionary industry groups - have performed worse. Normally, I tend... READ MORE
During my webinar yesterday, I indicated that I'd take a look at the Russell 2000 ($RUT) and its lagging performance, but then I was sidetracked by other charts and questions. So I'll take an opportunity here in my blog to provide you those Russell 2000 comments.... READ MORE
The best stock traders on the planet share one common ingredient. They manage risk. Managing risk can mean lots of things. You can manage risk by trading Exchange Traded Funds (ETFs) instead of individual stocks. This will help to eliminate, or significantly reduce, specific stock risk. If you don'... READ MORE
This is a series of articles designed to remind each of us the keys to identifying the many potential warning signs that create stock market tops. If you're just tuning in, you can CLICK HERE for Part 1 that begins the series. Enjoy! This is the final part... READ MORE
This is a series of articles designed to remind each of us the keys to identifying the many potential warning signs that create stock market tops. If you're just tuning in, you can CLICK HERE for Part 1 that begins the series. Enjoy! Today, I want to delve... READ MORE
It's Kentucky Derby Day so of course! Oops, wrong blog! :-) We know that the stock market goes through periods of consolidation and rotation. Groups that lead for a period of time eventually fall out of favor as new groups emerge as leaders. Then we rinse and repeat.... READ MORE
Today marks two months for me here at StockCharts.com and I just want to thank everyone for your kind words and especially for all of the technical feedback. Your comments are very important to me so please keep them coming. Writing and teaching about the stock market is what... READ MORE
A little more than a week ago, CAMP broke trendline resistance after posting better than expected earnings results. CAMP's top line was $69.2 mil (actual) vs. $68.0 (estimate), while its bottom line also beat Wall Street estimates, $.29 vs. $.25. The breakout occurred on huge volume... READ MORE
I've discussed price action (duh!), the relative performance of aggressive sectors and defensive sectors vs. the benchmark S&P 500 and the relationship between consumer discretionary (cyclical) stocks and its consumer staples counterparts in prior articles and how they impact the future behavior of stock prices. This... READ MORE
When evaluating the stock market for a potential top, there's another intermarket relationship that seems to provide us a nice clue. So without further hesitation, let me move on to my third area of the stock market to watch: 3. WHICH GROUP OF CONSUMER STOCKS IS LEADING? There&... READ MORE
On Wednesday, I began a series of blog articles that is designed to evaluate the health of the stock market. In other words, what should we be looking for in determining whether we should leave our retirement and taxable accounts at risk? Wednesday's blog was the first, and... READ MORE
At 10am EST this morning, March new home sales were released and they fell well short of expectations. Is that a long-term problem for home construction ($DJUSHB) or is it an opportunity for traders to move into this area of the market at lower prices? Well, you'll have... READ MORE
Wow, this is a loaded question and it will take a few articles to try to address it. For every bear market, we seem to have a different reason. Since the turn of the century, we've seen two significant bear markets - one that gripped the market from... READ MORE
Perhaps one of the biggest mistakes we make is to misinterpret normal stock market rotation as a predecessor to a bear market. During a bull market, money rotates from sector to sector, from industry group to industry group and from stock to stock. Of course there are outperformers throughout a... READ MORE
I know looking at one industry group is taking a very small sample of the entire stock market, but throughout much of history the stock market has performed strongest when financial stocks, especially banks, at least go along for the ride. Let me show you a long-term chart of the... READ MORE
From a technical perspective, the StockCharts Technical Rank (SCTR) makes a TON of sense. It's a very quick way to see how a stock is performing relative to its peers (ie, large cap, mid cap, small cap). These rankings are based on technical scores developed by John Murphy... READ MORE
After the close on Wednesday, Netflix (NFLX) topped revenue and earnings expectations and promptly rose to all-time highs. NFLX had been consolidating in bullish sideways fashion for over one year following its prior uptrend. Volume today is extremely heavy suggesting accumulation and, in my opinion, likely higher prices ahead. The... READ MORE
Better than expected earnings and technical price action follow through is perhaps my favorite combination when trading a stock. My background in public accounting leaves a warm place in my heart for management teams that execute on their business plan and are able to surprise Wall Street to the upside.... READ MORE
On Monday, the Russell 2000 ($RUT) was breaking out to an all-time high intraday. Unfortunately, it wasn't confirmed on the close as this benchmark of small cap stocks reversed late in the day. It not only left a bearish tail to the upside and closed at its open... READ MORE
Most everyone knows that Uncle Sam is waiting anxiously for April 15th to arrive. Don't look now, but it's almost here! Even if you decide to extend the filing date for your tax return, any balance due must be paid now. The payment generally cannot be... READ MORE
The volatility index ($VIX) charts the implied volatility of S&P 500 index options. It's a sentiment indicator that measures the stock market's expectation of volatility over the next 30 day period. I could spend time talking about square roots, variance swaps and standard deviations,... READ MORE
SFUN serves as a real estate internet portal in the Peoples Republic of China and is rallying strongly today on the heels of overall strength in most Chinese shares. Technically, the downtrend in SFUN has been reversed on a series of positive technical developments. First, SFUN had been in a... READ MORE
Technology stocks have been lagging throughout 2015. One of the primary reasons for their uninspiring performance has been the underwhelming action in the Dow Jones US Semiconductor Index ($DJUSSC). Before we delve into the semiconductors, let's see what technology as a whole is facing - take a look... READ MORE
FMC Technologies (FTI) provides technology solutions for the energy sector. Much of the energy space has struggled for the last several months for a number of reasons, one of which has been the higher dollar. The rising greenback has provided a headwind for energy companies, but with the suddenly weak... READ MORE
Two months ago, there weren't many better looking industry groups than the Dow Jones US Electrical Components & Equipment Index ($DJUSEC). The breakout above price resistance was clear, but after a continuing advance of another 10% into mid-March, the DJUSEC ran into technical issues. Take a look at... READ MORE
Generally, I review my trading positions on a stock by stock basis. If I've hit my target on one, I try to be disciplined and take the profits - or at the very least partial profits. If my stop loss has been triggered, it's time to... READ MORE
I discussed how using the MACD in concert with price/volume can be instrumental in making a high probability exit in Parts 1 and 2. Today, I want to focus on candlesticks. I'm a fan of Steve Nison's and have read his books on candlesticks. The... READ MORE
Let's continue the discussion from yesterday. Broadcom (BRCM) had fallen back in late January to test both price and multiple gap supports, with an intraday move beneath both that suggested we could be witnessing a breakdown. By the close, however, BRCM printed a very bullish reversing candlestick (hammer)... READ MORE