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THE FOUR-YEAR PRESIDENTIAL CYCLE SUGGESTS THAT 2014 COULD SUFFER A MAJOR DOWNSIDE CORRECTION -- THE GOOD NEWS IS THAT A MAJOR BUYING OPPORTUNITY IS LIKELY LATER IN THE YEAR -- THE STRONGEST THREE MONTH PERIOD ENDS IN JANUARY
by John Murphy,
Chief Technical Analyst, StockCharts.com
SECOND YEAR OF PRESIDENTIAL TERM IS USUALLY THE WORST ... Those of you who have read my messages over the last year know that I am bullish on the long-term direction of the stock market. I believe that the "secular" bear market that started in 2000 ended this year...
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SPY APPROACHES SUPPORT ZONE AND BECOMES OVERSOLD -- RUSSELL 2000 IS UP 85% OF THE TIME IN DECEMBER -- DIA AND IWM CORRECT WITH BULL FLAGS -- HIGH-LOW INDICATOR HITS MAKE-OF-BREAK LEVEL -- SMALL DIVERGENCES FORM IN AD LINE AND AD VOLUME LINE
by John Murphy,
Chief Technical Analyst, StockCharts.com
SPY APPROACHES SUPPORT ZONE AND BECOMES OVERSOLD... Link for today's video. After a big October and big November, trading in the S&P 500 ETF (SPY) and stock market turned choppy in December. The trading range is relatively small and not enough to affect the overall uptrend....
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The Probability Buster Chart: Possibly the Single Best Visual Analysis Chart Ever
by Gatis Roze,
Author, "Tensile Trading"
If there was one mantra to embrace which would make you money it would be“let the probabilities work for you” or some similar phrase. As a seasoned investor with over 25 years trading the markets, I feel one of my core strengths has been my ability to find ‘probability...
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Delta and SW Airlines Lead Industrials Sector
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
The Sector MarketCarpet shows that Delta and Southwest, two airline stocks, are leading the industrials sector on Thursday. Airlines tend to move as a group and this means other airline stocks are likely strong as well. Note that both stock hit 52-week highs in late November and led the market...
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NYSE Breadth Weakens, but Evidence Remains Bullish
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
The December pullback weakened a few indicators, but the bulk of the long-term evidence remains bullish. Most notably, the NYSE AD Line formed a small bearish divergence, as did the NYSE AD Volume Line. The Nasdaq AD Line and AD Volume Line, however, did not form divergences and techs remain...
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Small-Caps Firm, but Techs Weaken as IGN Breaks Wedge
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Stocks put in a mixed performance on Thursday as the Russell 2000 ETF (IWM) edged higher and the Nasdaq 100 ETF (QQQ) edged lower. The sectors were also mixed with the Consumer Staples SPDR (XLP) taking the biggest hit (-1.38%). Techs were under pressure from the Networking iShares (IGN)...
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GLOBAL MARKETS ARE MOSTLY LOWER IN DECEMBER -- PERCENTAGE OF STOCKS ABOVE THE 50 DMA CONTINUE TO DETERIORATE -- $COMPQ IS STILL OUTPERFORMING -- UTILITIES AND ENERGY SECTORS UNDERPERFORM -- $USD APPEARS CORRECTIVE
by John Murphy,
Chief Technical Analyst, StockCharts.com
** GLOBAL MARKETS ARE MOSTLY LOWER IN DECEMBER **... Chart 1 shows the price moves of the major global markets since the close of November. The $BSE ( Bombay, India) has moved higher. The $FTSE (London) and $CAC (France) markets are continuing to go lower. Germany is still strong as it is up...
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Natural Gas ETF Leads as Metals ETFs Lag
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
The Natural Gas ETF (UNG) is on a tear with a 15+ percent gain since October 30th. The PerfChart below shows UNG with nine other commodity-related ETFs. The eight metal-related ETFs are down with the Gold SPDR (GLD) and Silver Trust (SLV) leading the way lower. The US Oil Fund...
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Correction Extends with Small-Caps Leading the Way
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Stocks extended their corrective ways as the major index ETFs fell over 1%. While most news outlets suggested that this was a taper tantrum, I am not so sure because stocks were up substantially in November, not to mention year-to-date. The prospects of a taper have been building for weeks...
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Charts of Interest: DDD, DNDN, EBAY, SYSS, TSM, XONE
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
DDD Forms Dark Cloud at Prior High.
DNDN Edges Higher with Good Volume.
Plus EBAY, SYSS, TSM and XONE
Individual charts are below video.
Sorry but your browser doesn't support HTML5 video.
**This chart analysis is for educational purposes only, and should not
be construed as a recommendation...
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European Top 100 Index Breaks Channel and Underperforms
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
The European Top 100 Index ($EUR) broke below the lower trend line of a five month channel with a sharp decline this month. In addition, notice that the index broke below the mid November low and these breaks are holding. European stocks are also showing relative weakness as the price...
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Small-Caps Turn Laggards as IWM Fills the Gap
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
SPY and QQQ remain in short-term uptrends, but stocks are in a December funk of sorts. Small-caps are lagging as IWM filled its gap and failed to hold its breakout. As shown yesterday, the S&P 500 AD Line formed a bearish divergence and broke support. In Tuesday'...
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BROADCOM LEADS SEMICONDUCTOR SPDR HIGHER -- RETAIL SPDR WEAKENS AHEAD OF RETAIL SALES -- HOME CONSTRUCTION SPDR CHALLENGES RANGE RESISTANCE -- TOLL BROTHERS CHALLENGES RESISTANCE - PLUS DHI AND PHM -- FACEBOOK AND LINKEDIN GET SOME MOJO BACK
by John Murphy,
Chief Technical Analyst, StockCharts.com
BROADCOM LEADS SEMICONDUCTOR SPDR HIGHER... Link for today's video. Programming note: Yesterday's video was truncated at the 15 minute mark and did not include the last section, which was a demo on using the SCTR tables. This video has since been fixed to include the last...
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An Array of Patterns Takes Shape for TEVA
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Teva Pharmaceuticals (TEVA) has been all over the place since early October, but two bullish patterns are taking shape and the stock could be poised for a breakout. First, the stock formed a massive island reversal with the late October gap down and the late November gap up. Second, the...
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Charts of Interest: BOOM, CVC, FLIR, K, LXK, SWC
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
BOOM Shows Relative Weakness.
CVC Breaks Out with Good Volume.
Plus FLIR, LXK, SWC
Individual charts are below video.
Sorry but your browser doesn't support HTML5 video.
Click here for iPad/iPhone Version
**This chart analysis is for educational purposes only, and should not
be construed as a...
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S&P 500 AD Line Forms Short-Term Divergence
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Stocks meandered on Monday with the Nasdaq 100 ETF (QQQ) edging higher (.41%) and the Russell 2000 ETF (IWM) closing fractionally lower (-.03%). Seven sectors were up and two were down (XLU and XLY). Despite weakness in the consumer discretionary sector, the Home Construction SPDR (ITB) and the Retail...
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A Dark Cloud forms over Seagate
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Seagate Technology (STX), which is a Nasdaq stock with a three letter symbol, opened strong and closed weak to make the dark cloud scan list. These are potentially bearish patterns that require confirmation. A move below 49.5 would break the three week trend line and produce a bull trap,...
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SHANGHAI COMPOSITE BREAKS A MAJOR TREND LINE -- COPPER BOUNCES WITHIN FALLING CHANNEL -- OIL BOUNCES OFF THE MIDDLE OF LONG-TERM RANGE -- OIL-RELATED ETFS UNDERPERFORMED DESPITE SURGE IN OIL -- RANKING SECTORS USING THE STOCKCHARTS TECHNICAL RANK (SCTR)
by John Murphy,
Chief Technical Analyst, StockCharts.com
SHANGHAI COMPOSITE BREAKS A MAJOR TREND LINE... Link for today's video. The Shanghai Composite ($SSEC) is making a breakout bid with a move above the 2011 trend line and a break above flag resistance. Chart 1 shows the index hitting a new low with a move below 1900...
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A Peak Inside Santa's Grab Bag for StockCharts' Users
Hello Fellow ChartWatchers!
Happy Holidays and Merry Christmas to you and yours from your good friends at StockCharts!
I have several important announcements I'm dying to tell you about but first a quick reminder that John, Arthur, Greg, Carl, Richard and Tom are all have articles later in...
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Don't Forget Historical Tendencies
by Tom Bowley,
Chief Market Strategist, EarningsBeats.com
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...
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US Dollar Bear Market
by Richard Rhodes,
Founder and President, Rhodes Capital Management and Rhodes Trading Group
In the fundamental economic forum, the balance of economic data has been "positive" as of late with the exception of the housing market. And this data has engendered a belief that the Fed shall begin to
pullback on its bond-buying campaign - which shall simply be US Dollar...
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Stocks Bounce Off Chart Support
by John Murphy,
Chief Technical Analyst, StockCharts.com
Friday's announcement that U.S. payrolls rose by 203,000 during November with the unemployment rate falling to 7% (the lowest level in five years) topped a week of encouraging economic news. Stocks rose strongly on that report, which suggests that good news is finally being recognized as...
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Gold: A Chance for a Bottom
by Carl Swenlin,
President and Founder, DecisionPoint.com
After making a bear market low in June, gold rallied about 20%. Then from the August top, price headed back down for a possible retest of the June low.
There is a good chance that the retest will fail, sending bear market prices to lower levels, but there is also...
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STRONG JOBS REPORT GIVES STOCKS A BIG LIFT -- GENERAL MOTORS LEADS AUTOS HIGHER AS TESLA JUMPS -- RAILS TOP INDUSTRIAL SECTOR AS NORFOLK SOUTHERN, CSX, AND UNION PACIFIC HIT NEW RECORDS
by John Murphy,
Chief Technical Analyst, StockCharts.com
STOCKS BOUNCE OFF CHART SUPPORT... Friday's announcement that U.S. payrolls rose by 203,000 during November with the unemployment rate falling to 7% (the lowest level in five years) topped a week of encouraging economic news. Stocks rose strongly on that report, which suggests that good news...
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The January Effect Gets Earlier and Earlier
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
The "January effect" refers to the propensity for stocks to outperform in January and for small-caps to outperform large-caps in January. According to this theory, stocks tend to rise more in January than most other months and small-caps tend to rise even more. Chartists looking to test these...
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Yield Curve Steepens as 10-Year Surges
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
The yield curve is steepening as the 10-YR Treasury Yield ($TNX) surges more than the 2-YR Treasury Yield and the 3-Month Treasury Yield. A steepening yield curve confirms loose monetary policy and this could help banks, which make money by borrowing short and lending long.
Click this image for a...
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Some Seasonal Goodies For You To Unwrap
by Gatis Roze,
Author, "Tensile Trading"
Over the past 10 years, the S&P 500 (SPY) has closed higher than it opened in the month of December 78% of the time.
This week, I culled a basket of half a dozen equities from Investor Business Daily’s IBD 50 list. All of these particular 6...
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FINANCE SPDR BOUNCES OFF BROKEN RESISTANCE -- REGIONAL BANKS OUTPERFORM BIG BANKS -- EEM BOUNCES WITHIN BULL FLAG -- SOLAR ETF STARTS TO LAG -- FIRST SOLAR FORMS BEAR FLAG, PLUS SCTY AND SPWR -- MANUFACTURING AND SERVICES REMAIN STRONG
by John Murphy,
Chief Technical Analyst, StockCharts.com
FINANCE SPDR BOUNCES OFF BROKEN RESISTANCE... Link for today's video. The Finance SPDR (XLF) led the market lower over the last four days, but the ETF found support near broken resistance and surged around 1% in early trading on Friday. Chart 1 shows XLF in a long-term uptrend...
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Breadth Indicators Hit New Highs and Small Caps Perk Up
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
The bulk of the evidence remains bullish as stocks continue in strong uptrends. The Nasdaq AD Line and AD Volume Line hit new highs as techs led the market in November. The NYSE AD Line and AD Volume Line are lagging somewhat, but are nowhere close to breaking down and...
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SPY Extends on Flag - $NATGAS Surges thru Resistance
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Stocks extended their corrective ways as the S&P 500 ETF (SPY) lost ground for the fifth consecutive day. Bespoke reports that 1996 was the last time the S&P 500 started December with a five day decline. Maybe so, but the index is down a mere 1....
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Facebook Challenges Key Moving Average
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Facebook (FB) got a bounce over the last seven days and broke above the wedge trend line. This is the first step to ending the correction that started in mid October. The 50-day moving average is the next hurdle. A follow thru break above this moving average on good volume...
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COMMODITIES GET A BOUNCE -- $WTIC TESTS THE 200 DMA FROM THE BOTTOM -- $GOLD FINALLY HAS A SHORT COVERING RALLY -- COPPER RALLIES WITHOUT DIVERGENCE -- $USD SPENDS NOVEMBER TRAPPED BETWEEN THE DMA'S
by John Murphy,
Chief Technical Analyst, StockCharts.com
$WTIC TESTS THE 200 DMA FROM THE BOTTOM ... Oil, Gold and Copper made big short covering rallies yesterday. More importantly, the $WTIC 200 DMA is tilted down now and the 50 DMA has crossed below. This is a price zone of significant resistance. We can see from the chart that...
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IWM Hits Moment of Truth - TLT Falls Sharply
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Stocks extended their mixed correction with weakness for the third day running. The declines, however, remain very modest and selling pressure has been contained. The Russell 2000 ETF (IWM) lost .27% on the day, while the Nasdaq 100 ETF (QQQ) edged higher with a .09% gain. Microsoft led QQQ higher...
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Charts of Interest: ATVI, CHRW, EMC, FFIV, TIBX
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
ATVI Triangulates with Two Patterns.
CHRW Tests Key Support Level.
Plus EMC, FFIV and TIBX
Individual charts are below video.
Sorry but your browser doesn't support HTML5 video.
Click here for iPad/iPhone Version
**This chart analysis is for educational purposes only, and should not
be construed as...
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Lexmark Bounces off Support with Good Volume
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Lexmark (LXK) presents a conundrum for traders. On the bullish side, the stock bounced off support near 35 with a three day advance on pretty good volume. Relative to the market, the stock is also holding up pretty well the last three days. On the bearish side, the stock shows...
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Tech Sector Shows Relative Strength During Correction
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
The major index ETFs corrected over the last two days, but this correction turned mixed as the tech sector held up relatively well on Tuesday. Also notice that the declines in the major index ETFs were modest and not that significant, especially considering the big gains from November. The PerfChart...
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WTI Surges, but Brent-WTI Spread Remains Large
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
Brent Crude ($BRENT) surged above $110 this week and WTI Crude ($WTIC) moved above $96, but the spread between the two remains wide. The chart below shows Brent trading some $18 higher than WTI. The indicator window shows the $BRENT:$WTIC ratio nearing 1.2 for the first time since...
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OVERBOUGHT MARKET STARTS TO LOSE UPSIDE MOMENTUM -- THE DOW MAY RETEST SUMMER HIGHS -- THE VIX IS BOUNCING OFF CHART SUPPORT WHICH IS ANOTHER SHORT-TERM CONCERN -- MONEY MANAGERS MAY BE TAKING PROFITS A LITTLE EARLY THIS YEAR
by John Murphy,
Chief Technical Analyst, StockCharts.com
OVERBOUGHT DOW MAY BE STARTING SHORT-TERM CORRECTION ... Given the extent of the market rally since October, it's no surprise that it has reached an overbought condition. Chart 1, for example, plots the Dow Industrials. The 14-day RSI line (top of chart) is backing off from the 70 level...
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STEEL ETF STARTS UNDERPERFORMING AS WEDGE TAKES SHAPE -- RSI HITS MAKE-OR-BREAK LEVEL FOR METALS & MINING SPDR -- SEMICONDUCTOR SPDR PERKS UP WITH WEDGE BREAKOUT -- NETWORKING ISHARES BOUNCES WITHIN LARGER DOWNTREND
by John Murphy,
Chief Technical Analyst, StockCharts.com
STEEL ETF STARTS UNDERPERFORMING... Even though the stock market is strong overall, there are pockets of weakness in various industry groups over the last one to three months. Today's commentary will look at some of the underperforming industry group ETFs and show what it would take to reverse...
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Gold Nears July Low as Dollar Firms at Support
by Arthur Hill,
Chief Technical Strategist, TrendInvestorPro.com
After a two week surge at the end of November, stocks started December with some selling pressure. Small-caps and micro-caps led the two week surge, and the Monday pullback. The Russell 2000 ETF (IWM) fell 1% and the Russell Micro Cap ETF (IWC) fell 1.44%. The sectors were mixed...
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