If ever the bulls needed to see some stellar earnings results and/or positive forward guidance, it was about one month ago. From the late September high of 2019 to the mid-October low of 1821, the S&P 500 fell nearly 10% just as earnings season kicked off.... READ MORE
First, let me say Happy Halloween to all! It's an exciting time for many, but especially the children. I know our neighborhood is always buzzing with kids anticipating the sugarfest! :-) Unfortunately, the stock market bears were SPOOKED on Halloween this year. I've said for months the... READ MORE
Make no mistake about it, volume has exploded and stock prices have fallen and lost key support levels. That combination is bearish in and of itself. But the part that really bothers me is that intermarket warning signs have been flashing for months so this high volume market drop confirms... READ MORE
The Fed is winding down its asset purchase program and the historically weak month of September is now behind us. So what's in store next? Earnings season. The stock market sends us signals all the time and given the recent performance of certain sectors and industry groups, we... READ MORE
You should know by now that I'm a HUGE fan of the Moving Average Convergence Divergence (MACD) indicator. Other than the combination of price/volume and the use of candlesticks, it's probably my "go-to" indicator. As a case study for this weekend, let&... READ MORE
Identifying a tradable gap can be quite profitable, but also frustrating at times. Awful news hits the wires and a stock gaps lower. The immediate question becomes "Should I sell at the open?" Well, conventional wisdom may suggest that you sell and your emotions may suggest it as... READ MORE
The NASDAQ has been powering forward off the mid-April lows and one big reason has been the semiconductor industry. The Philadelphia Semiconductor index ($SOX) rose 15% in just a seven week period from May 15th through July 3rd. From there, a severe long-term negative divergence printed and that... READ MORE
Warning signs have piled up for months, but there have been few breakdowns to confirm all of these bearish signals. That changed last week as volume surged leading to breakdowns across many of our major indices, sectors and industry groups. One obvious problem was the S&P 500'... READ MORE
Financial stocks have lagged throughout 2014 and are showing signs of slowing momentum. That's keeping hope alive for the bears. The XLF (ETF tracking financial stocks) has a clear long-term negative divergence in play on its MACD as you can see from the chart below: Most of... READ MORE
It's been quite confusing for several reasons, a few of which are discussed below. Historically, the S&P 500 nearly always struggles during the balance of a calendar year in which January performance is weak. In January 2014, the S&P 500 fell 3.56%, ranking... READ MORE
The Dow Jones US Industrial Suppliers Index ($DJUSDS) experienced a HUGE bull market run off the 2009 lows through mid-2013, quadrupling in value during the period. Momentum on the weekly chart turned negative, as evidenced by the long-term negative divergence on its MACD. As a result, this index... READ MORE
In my last article, I posted a chart of the Russell 2000, identifying a potentially bearish head & shoulders pattern. This pattern, however, requires a high volume breakdown to confirm the likelihood of future weakness. That breakdown never occurred and small cap bulls used historical bullish tendencies from late May... READ MORE
I've been very cautious about the stock market throughout most of 2014. There are warning signs galore. But the Russell 2000 has been hit particularly hard year-to-date, dropping approximately 10% from the high set in early March. That was the time when money began rotating away... READ MORE
In 2013, market participants couldn't get enough of cyclicals, or consumer discretionary stocks. The XLY (ETF that tracks consumer discretionary) rose more than 40% in 2013 to lead all sectors on a relative basis. But things have changed in 2014, with many of the strong industry groups in... READ MORE
Last week's gains may have been more about options expiration and an oversold bounce than anything else. I have my eyes set squarely on the NASDAQ right now, waiting either for a resumption of the five year bull market or a breakdown of its current head & shoulders... READ MORE
In earlier 2014 articles, I've discussed warning signs that emerged from Volatility indices, behavior in the treasury market, relative weakness of banks and relative strength of defensive areas of the market like utilities and REITs. In addition, the S&P 500 has shown a propensity to struggle... READ MORE
Nope, I'm not referring to college basketball. Instead, it's this wacky stock market. In my last article, I discussed several reasons why the 2014 advance is on shaky ground. Since then, we've seen increased volatility and lots of whipsaw action. Earlier in March, our... READ MORE
Make no mistake about it, I prefer to be bullish. History supports this notion because the stock market has always tended to move higher more than it moves lower. Dating back to 1950, the S&P 500 has moved higher over 53% of trading days. Did you know that... READ MORE
Just two weeks ago, the stock market seemed on the verge of its first correction in a long time - all within the confines of a long-term bull market that began in March 2009. Then came the breakdown I was looking for to confirm it. Check out the head &... READ MORE
Signs of a sustainable bull market rally include strong relative performance from financial stocks, especially banks, and rising treasury yields that result from rotation away from treasuries. Both of these areas of the market are flashing warning signs right now, although technical breakdowns to confirm the weakness have not yet... READ MORE
This bull market has been humming along since March 2009, but we cannot ignore the storm clouds building on the horizon. The technical conditions have slowly deteriorated with the highly influential banking industry ($DJUSBK) reversing hard last week with a long-term negative divergence present on its weekly chart. Those... READ MORE
It's my favorite time of the quarter - as a trader. I approach it like an offensive or defensive coordinator on one of the NFL playoff teams this weekend. I study recent history to find strengths and weaknesses of the market and then I anticipate "plays" (price... READ MORE
It's quite easy to look at the S&P 500 and see if it's rallying or not. But not every rally is created equal. Many rallies carry significant warning signs that should have you running for cover. Others simply invite you to jump on the... READ MORE
When I map out my trading strategies, I consider fundamentals, especially quarterly earnings reports, but I FOCUS on technical indicators. The study of price action helps to determine future price action, but note that it doesn't guarantee it. The basic premise of trading is to set up the... READ MORE
I rarely question a market move to the upside when banks are leading the charge. And if you're wondering how the banks performed last week as the S&P 500 broke to a fresh all-time high, check out the Dow Jones US Bank Index chart: Banks... READ MORE
I've maintained a bullish stance throughout this bull market, but I have to admit I'm beginning to get a little nervous. As a stock market historian, it's difficult for me to think bearish thoughts as we enter November because November, December and January are... READ MORE
I've mentioned it before, but I'll say it again. I LOVE trading stocks (in bull markets) that gap higher on better-than-expected revenues and earnings and very strong volume as it's a sign of great management execution and investor accumulation. That combination is... READ MORE
As a trader, this is my favorite time of each quarter. I love it when earnings begin to roll out because the increased volatility generally sets up excellent trading opportunities. In early April, I wrote about the strong earnings report that Nike (NKE) enjoyed in March and I highlighted a... READ MORE
Federal Reserve Chairman Ben Bernanke has had several mandates since the financial crisis began several years ago. One was to keep interest rates extraordinarily low for an extended period of time. Check. Another was to make the Fed more transparent. This one was humming along just fine....until Wednesday'... READ MORE
The past 5-6 weeks have not been overly kind to the bulls. In fact, since topping at 1709.67 at the close on August 2nd, the S&P 500 has lost more than 50 points or roughly 3%. Many are calling for the end of the four and... READ MORE
Most areas of the stock market have enjoyed the past few months, especially since the lows of June 24th. Don't count software as one of those groups, however. At first glance, this might seem like an area of the market to avoid because of poor relative strength over... READ MORE
Transportation stocks helped lead the market rally from October 2012 through March 2013, but since that time it's been a struggle on a relative basis. Check out this relative chart: Relative support resides near the 3.80 level in the chart above - a relative close beneath this level... READ MORE
In the very near-term, it's difficult to predict which way the S&P 500 is heading. Recently, we saw the Volatility Index ($VIX) spike to nearly 22 and the multi-month uptrend line on the S&P 500 was violated. Take a quick look: The... READ MORE
Volatility plays a role in any market environment, but I always look to key areas of resistance on the VIX to help identify tradable bottoms on the S&P 500. In my last article on June 1st, I suggested that the 18-19 resistance on the VIX could prove... READ MORE
That's the bad news. The good news is that momentum issues are more of a short-term nature than a long-term one. Still, as traders, we need to respect them just the same. First, let's take a look at the benchmark S&P 500... READ MORE
So much for "Go away in May"! I've written in the past that this is VERY misleading information that's routinely provided to the investing public. For example, the month of May is one of the best months of the year to invest in small... READ MORE
Every quarter, my goal is to identify the absolute best stocks that I can find from both a technical and fundamental standpoint. I am a firm believer that stocks beating expectations, raising guidance, trading extraordinarily high amounts of volume and printing bullish candlesticks have much better odds of trading higher... READ MORE
At its highest level last week (Thursday afternoon), the VIX was up 50% from its prior Friday close. That's a HUGE spike in volatility. Volatility, as measured by the CBOE Volatility Index (VIX), provides us a gauge of fear in the stock market. The VIX measures the market&... READ MORE
This is my favorite time of the quarter. Being a "technifundamentalist", I like finding companies that look solid both technically and fundamentally and concentrate my trading efforts there. For me, it all begins with volume. If a company reports earnings and receives a ho-hum response in terms... READ MORE
Personally, I love the MACD. It's one of my favorite technical tools when trading. It's not perfect - nothing is - but it does provide us a snapshot of momentum of a stock or index. The MACD is nothing more than the difference between two exponential moving averages,... READ MORE