Early in writing these articles I talked a lot about market internals or market breadth. As a refresher, I’ll review the basics and then offer an opinion on why breadth is so important. Breadth Components Breadth components are readily available from newspapers, online sources, etc. and consist of daily... READ MORE
Market Recap for Friday, May 12, 2017 The NASDAQ finished higher on Friday, but that was not the case for the Dow Jones and S&P 500, which both finished fractionally lower. The Russell 2000 was hit hardest as this small cap index again threatened a short-term breakdown beneath... READ MORE
* Trying to replicate the Shanghai Composite with a Chinese ETF * Global Update Years ago, investing in China was a challenging proposition for US based investors. In recent years though, a number of ETF’s have been listed that embrace Chinese Indexes as well as specific sectors. The big daddy of... READ MORE
Intel (INTC) has been trading in bullish sideways fashion since topping in October. The Dow Jones U.S. Semiconductor Index ($DJUSSC) has continued to rise and lead the benchmark S&P 500 on a relative basis - even while INTC consolidates. A breakout in Intel would measure to 42... READ MORE
BOND YIELDS DROP ON FRIDAY... Some caution crept into financial markets near the end of the week. Part of that was reflected in Friday's sharp drop in bond yields. Chart 1 shows the 10-Year Treasury Yield falling back below its 50-day average in pretty decisive fashion. That was... READ MORE
I thought that last week's breakout was the initiation of a new rally that would continue this week. But no. This week price moved back below the breakout level, but strangely this failure did not develop into a more serious breakdown either. Price just continued to churn sideways,... READ MORE
Horizontal Point and Figure analysis is one of the great mysteries of technical analysis. Very few do this analysis, and even fewer do it correctly. An incorrect procedure leads to bad counts. But when it is done properly PnF is magical. We have spent much time here establishing proper counting... READ MORE
Small-Cap High-Low Line is Still Rising The bulk of the evidence remains bullish for stocks, but small-caps and mid-caps continue to drag their feet. The chart below shows the cumulative High-Low Line for S&P SmallCap High-Low Percent ($SMLHLP) with the 10-day EMA (pink). Notice that the High-Low Line... READ MORE
I’d like to paraphrase a fishing analogy. Show someone how to invest by following a winning trading methodology and he/she will be happy for awhile. Teach someone how to think effectively about trading and he/she will be profitable for a lifetime. All too often as investors, our... READ MORE
Weekly Market Review & Outlook .... On a Road to Nowhere ($VIX and $SPX) .... High-Low Lines Continue to Rise .... Deterioration in %Above 200-day Indicators .... SPY Holds the Breakout and the Gaps .... IJR and MDY Tests their Breakout Zones .... Mind the Gap-Breakouts in XLI and XLF .... Correlations with the 20+ YR T-Bond... READ MORE
Market Recap for Thursday, May 11, 2017 Consumer staples (XLP, +0.15%) and utilities (XLU, +0.14%) were beneficiaries of money rotating more defensively on Thursday. While the end result at the close wasn't bad overall (the Dow Jones and S&P 500 lost 0.11% and... READ MORE
No new changes to the DP Scoreboards to report...except that you can now find the DP Scoreboards on your member homepage! I'll be writing about how to quickly access it in tomorrow's blog. While everything remains green on most of the boards, I did note... READ MORE
* The VIX * The Dollar Index * The Euro * Swiss Franc * Japanese Yen The VIX Most of this piece is devoted to the dollar and some interesting looking currencies. However, I have been intrigued by a couple of articles and news stories recently appearing in the general purpose media. They have pointed... READ MORE
Market Recap for Wednesday, May 10, 2017 The energy sector (XLE, +1.32%) was very strong on Wednesday as crude oil ($WTIC) bounced more than 3%. With crude oil up nicely again this morning, we should see more strength and leadership from the XLE today. Technology (XLK, +0.38%) and... READ MORE
.... Split Performance Hinders Biotech ETF .... Amgen Lagging Biotechs and Market .... HealthCare SPDR Holds Breakout .... Pfizer Slows to a Crawl .... Delivery and Trucking Weigh on Dow Transports .... Use Sector Summary to Drill Down .... Refiner Stocks Catch a Bid .... Stocks to Watch: AES, EMR, FLIR, NTAP Split Performance Hinders Biotech ETF The... READ MORE
I realized that I haven't really reviewed the small and mid-cap ETFs in some time. You'll find these charts in the DecisionPoint LIVE shared ChartList if you want to keep an eye on them with my annotations. The chart patterns for these ETFs aren't... READ MORE
I was running through some charts today and came across and interesting setup - in Xerox of all names. It has been a long time since Xerox crossed my path. The company provides document management solutions with both hardware and services. It is a $7.2 billion company and part... READ MORE
Market Recap for Tuesday, May 9, 2017 Consumer discretionary stocks (XLY, +0.58%) were easily the leading group on Tuesday as hotels ($DJUSLG) and gambling ($DJUSCA) stocks were outperformers. Automobiles ($DJUSAU), recreational products ($DJUSRP) and home construction ($DJUSHB) also performed quite well. The latter group held recent price support and... READ MORE
The DP Scoreboards continue to show bullishness in all three time frames as far as price trends and momentum. The only outcast is the Dow which is still waiting on the weekly PMO to have a positive crossover. Unfortunately, the PMO on the weekly chart is still in decline. It... READ MORE
COMMODITIES DIVERGE FROM EEM... One of the long-held principles of emerging market behavior is that they're closely correlated to the direction of commodity prices. That's because several large emerging markets are exporters of commodities (like Brazil and Russia). China is the world's biggest importer... READ MORE
This is the fourth article dealing with cognitive biases that totally screw up your decision making. The first article, Know Thyself, covered anchoring, confirmation bias, herding, hindsight bias, overconfidence, and recency. The second article, Know Thyself II, covered availability, calendar effects, cognitive dissonance, disposition effect, and loss aversion/risk aversion.... READ MORE
Market Recap for Monday, May 8, 2017 The small cap Russell 2000 lagged on Monday with the other major indices tacking on minor gains. Energy (XLE, +0.71%) was the leader with coal ($DJUSCL) jumping 3.50%. The DJUSCL, however, is hitting major trendline resistance after kick-saving at price support.... READ MORE
.... IJR and MDY Tests their Breakouts .... Stocks and Junk Outperforming Treasuries .... Watch BAC, C, GS and JPM for Big Banks .... Watch USB, FITB, HBAN and ZION for Regionals .... Aroons Signal Consolidaiton for Arconic .... A Small Correction for Natty? .... BHI and XOM Held Up Better than their Peers .... Charts to Watch:... READ MORE
Merck is showing signs of life as it bounces off a breakout zone and the Stochastic Oscillator turns up. The overall trend is up because the stock hit a 52-week high in February and is above the rising 40-week moving average. After a breakout surge earlier this year, the stock... READ MORE
The Relative Rotation Graph for the 30 DJ Industrials (INDU) stocks once again presents us with some interesting insights. From the picture above we can read that AAPL is still the strongest stock in this universe with the highest JdK RS-Ratio reading and still inside the leading quadrant. Inside the... READ MORE
Market Recap for Friday, May 5, 2017 The headline news from Friday is that the Dow Jones was able to clear psychological overhead resistance at 21000 for only the second time in history (March 1st was the other) and that the S&P 500 managed to clear its all-time... READ MORE
As technicians, we look for prior price resistance to act as solid support once the resistance has been broken. That principle came into play on Nike, Inc. (NKE) as it tested a major price support just beneath 54.00 on Friday. NKE gapped down in the latter part of March... READ MORE
* $CRB and oil break to the downside * The stock market says commodities are headed lower * Bond market participants leaning in a deflationary way * Watch those commodity currencies The usual “Sell in May and Go Away” articles are starting to appear bigly, and a case can indeed be made in that... READ MORE
Last week I wrote regarding SPY: "Consolidation may continue for a bit, and it is possible that price will move lower toward the point of the breakout and fill Tuesday's gap; however, the charts in all three time frames are bullish, and I favor a breakout to... READ MORE
High yield bonds came into their own in the 1980’s and have become ever more important to the functioning of the economy. They are often referred to as ‘Junk Bonds’ because they are bonds of lower quality. Investors are attracted to them for the higher yields offered over treasury... READ MORE
----- Video Link ----- Art's Charts ChartList (updated 6-May) ----- Stocks were mixed this past week as the S&P 500 SPDR (SPY) and Nasdaq 100 ETF (QQQ) moved higher, while the Russell 2000 iShares (IWM) and S&P SmallCap iShares (IJR) edged lower. SPY is... READ MORE
I had already figured out what I would write about in today's ChartWatchers article, but that was put on hold when I received a Technical Alert in my email box telling me that we had IT Price Momentum Oscillator (PMO) signal changes on both the S&P... READ MORE
The McClellan Oscillator is a breadth indicator that Chartists can use to enhance their analysis of an index. StockCharts carries the McClellan Oscillator for dozens of broad market indexes, but not for the S&P sectors. There is no need to fret because StockCharts users can create the McClellan... READ MORE
SECTOR LEADERSHIP...One of the problems facing the current stock market is that some sectors have been rising, while others have suffered large losses. Since the start of the year, for example, technology has gained nearly 14% versus a 6.7% gain for the S&P 500. Energy stocks,... READ MORE
Approximately every five years, I dig into my Trading Journal with the specific mandate to unearth and review where I’ve earned my profits and losses. This is not a small project. I do it on an ongoing basis with all individual trades, but when taken in the 5-year aggregate,... READ MORE
Recent headlines have focused on tax reform, health care reform, partisan bickering, the president's first 100 days. But in the background many companies have been coming up big when reporting earnings which is why the market has been so strong of late. While the bears have been hoping... READ MORE
SECTOR LEADERSHIP... One of the problems facing the current stock market is that some sectors have been rising, while others have suffered large losses. Since the start of the year, for example, technology has gained nearly 14% versus a 6.7% gain for the S&P 500. Energy stocks,... READ MORE
... Weight of the Evidence for Stocks .... New Lows are Ticking Up in Large-caps and Mid-caps .... %Above 200-day Holds Strong for SPX and NDX .... Stocks and Bonds Rise Together .... Flags Take Shape in IEF and TLT .... S&P 500 SPDR Holds Breakout .... IJR Tests its Breakout .... QQQ Hits Another New... READ MORE
Market Recap for Thursday, May 4, 2017 Happy Cinco De Mayo! Cuatro De Mayo turned out to be a very flat day, with bifurcated action throughout the market. Even global markets were bifurcated. I counted 13 international ETFs higher yesterday with 10 lower. Markets everywhere are consolidating after mostly higher... READ MORE
The market hasn't really done much this week which is keeping the DP Scoreboards in a holding pattern. I've been getting regular 'technical alerts' that the OEX IT Price Momentum Oscillator (PMO) signal has changed, meaning that whipsaw is happening daily. We won'... READ MORE