With the "troika" of the US mid-term elections, FOMC meeting decision on QE-2, and the US Employment Situation Report having been digested by the markets, we thought it instructive to step back and take a longer-term viewpoint of the NASDAQ Composite. Perhaps by looking at the Composite, we... READ MORE
It's been a breathtaking move. The NASDAQ was trading near the 2100 level at the end of August. Friday it closed at 2579. That's more than a 25% move in just over two months. Of course that followed a 17% decline from April through August. The... READ MORE
Hello Fellow ChartWatchers! One of the things we are always trying to do here at StockCharts is "improve." We are always trying to make the website better - faster, more powerful, more flexible, you name it. We are also always trying to increase its value. Today, I'... READ MORE
Although a little late to the party, the Nikkei 225 ($NIKK) is showing signs of life with an inverse head-and-shoulders pattern taking shape. Note that the S&P 500 formed an inverse head-and-shoulders from mid May to mid September and broke resistance in the second half of September. The... READ MORE
(This is an excerpt from Friday's blog for Decision Point subscribers.) As of 7/14/2010 the US Dollar has been on a Trend Model NEUTRAL signal, and it has been in a bear market since the end of September when the 50-EMA crossed down through the 200-EMA.... READ MORE
The Homebuilders SPDR (XHB) finally broke above resistance with a surge the last few days. XHB was one of the laggards because it had yet to break its July high. This changed on Thursday as the ETF broke resistance with a gap and long white candlestick. Also notice that the... READ MORE
OVERBOUGHT READINGS AND THE 2006-2007 ADVANCE ... Link for todays video. The Commodity Channel Index (CCI) is a popular momentum oscillator that fluctuates above/below the zero line. Unlike RSI and the Stochastic Oscillator, CCI is not bound on the upside of the downside. Typically, a reading above +100 is considered... READ MORE
That certainly did not take long. Five indicators were downgraded from bullish to neutral last Friday. These indicators did not break down to warrant a bearish stance, but I downgraded them to neutral because they were not confirming the new highs seen in the major indices. That changed this week.... READ MORE
Stocks started the week strong and surged on Thursday with big gains in all major indices. All sectors were up with materials, energy, and finance leading the charge. These three were up over 3%. It is positive to see relative strength coming from the finance sector. On the daily SPY... READ MORE
After retracing around 62% of the prior advance, Newmont Mining (NEM) broke above flag resistance with a surge over the last few days. The breakout was under threat with Wednesday's pullback, but Thursday's surge keeps the flag breakout in play. There is one concern. NEM remains... READ MORE
SEMICONDUCTOR HOLDERS CLEAR APRIL HIGH ... The ability of any stock index or group to clear its April high is a sure sign of strength. In case you haven't noticed, the Semiconductor Holders are doing just that today. I point that out because, up until a couple of months... READ MORE
ANOTHER POSITIVE DOW THEORY SIGNAL ... With the US elections behind us, and the Fed giving the markets what they wanted yesterday, global markets are reacting very swiftly and in a positive manner. The US Dollar Index has fallen to the lowest level in two years and giving a big boost... READ MORE
$CIEN firms at key retracement. $CVS forms bull flag. $FITB shows relative strength. $GPS, $HD, $QLGC and $WFC. ----------------------------------------------------------------------------- This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need... READ MORE
Two down, one to go. The elections and the Fed have passed with little fanfare for stocks. Details of QE2 were released in the Fed policy statement. Bonds went one way and the Finance SPDR (XLF) went the other way. Funny how that worked. Bonds, which are direct beneficiaries of... READ MORE
After plunging on Monday, the Regional Bank SPDR (KRE) firmed on Tuesday to form a harami. This is essentially an inside day. Also notice that the ETF managed to firm near the 62% retracement mark. Wednesday's surged above Monday's high confirms the harami. Click this image... READ MORE
SLOW GRIND HIGHER CONTINUES FOR STOCKS... Link for todays video. The elections and the Fed policy statement have passed and the major indices have yet to be knocked out of their uptrends. Upside momentum has slowed, but we have yet to see any downside momentum, and certainly no support breaks.... READ MORE
The Euro broke resistance as long-term rates fell back to support. The first chart shows the Euro Currency Trust (FXE) breaking above range resistance and moving above the triangle trendline. This bullish development for the Euro is a positive for stocks. Range support around 138-138.2 is now the first... READ MORE
MIDTERM ELECTIONS ARE GOOD FOR STOCKS... One of the reasons that I started turning more positive on stocks over the summer was the fact that the four-year cycle was due to bottom this year. That and a positive turn in technical and intermarket trends. My September 2 message carried the... READ MORE
The Natural Gas Continuous-Futures ($NATGAS) formed a large weekly outside reversal pattern last week. Combined with a falling wedge and support in the 3.3-3.5 area, Natural Gas is threatening a bounce within its long downtrend. Watch the MACD-Histogram for a move into positive territory to signal some upside... READ MORE
The Nikkei 225 ($NIKK) failed at resistance as the Yen surged to new highs. The Nikkei 225 surged in September, but never broke resistance as a weak Dollar drove the Yen higher. It is possible that an inverse head-and-shoulders pattern is forming, but there are no signs of support or... READ MORE
ELLIOTT WAVE COUNTS FOR THE S&P 500... Link for todays video. The Elliott Wave count for the S&P 500 remains bullish overall. $SPX is currently in Wave 5 of a possible 5 wave advance that began in March 2009. The red numbers show this advance on... READ MORE
First note that I will be travelling on Tuesday and will not be able to write a commentary that day. The next commentary will be Wednesday morning. It is just as well because the markets will digest the week's first big event on Wednesday morning. The elections are... READ MORE
Linear Tech (LLTC) formed a large triangle over the last three months and broke resistance with a surge this week. Also notice that the stock broke above its September highs. Semis are showing upside leadership and this is positive for the tech sector. Click this image for a live chart... READ MORE
UTILITIES AND FINANCE LAG IN OCTOBER ... Link for todays video. The sector performance picture shows relative weakness in two interest-rate sensitive sectors. PerfChart 1 shows the relative performance for the nine sector SPDRs since September 30th. Keep in mind that this is not absolute performance. On an absolute basis, all... READ MORE
The indicator summary remains bullish overall, but five indicators were downgraded from bullish to neutral. First, the NYSE AD Volume Line peaked in mid October and is starting to lag. Second, the Nasdaq AD Line flattened as the Nasdaq continued higher. Third, the S&P 500, Nasdaq 100, VIX... READ MORE
There are likely to be some serious fireworks next week. This is one of the biggest news weeks that I can remember. First, we have election results on Tuesday. Second, the Fed meets on Wednesday. Third, there is the employment report on Friday. We can also throw in the ISM... READ MORE
BAND SUPPORT AND RESISTANCE LEVELS... I recently applied Bollinger bands to one of the major stock indexes to show the current uptrend and, more importantly, to spot any downturn. I thought this would be a good time to explain this useful indicator more fully, and to show different ways that... READ MORE
After a breakout and big surge towards the August highs, the USO Oil Fund (USO) took a breather with a pullback over the last few weeks. The falling zigzag in October looks like a falling flag, which is a bullish continuation pattern. The surge from 32.5 to 36.5... READ MORE
This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think for ourselves when it comes to trading our own accounts. First, it is the only way to... READ MORE
There is no change on the daily chart. Even though the advance has grown laborious, SPY remains in an uptrend. The surge above 114 on September 20th marked the easy part of the advance. Since this surge, SPY has worked its way higher within a rising price channel. All kinds... READ MORE
The DJ Greece Index ($GRDOW) shows a potential head-and-shoulders pattern evolving over the last five months. This version is a continuation pattern. A move below the October low would confirm the pattern and target lower prices. Click this image for a live chart... READ MORE
RUSSELL 2000 ETF STALLS WITH CHOPPY RANGE... Link for todays video. Since moving above 71 on October 13th, trading in the Russell 2000 ETF (IWM) has turned quite choppy with a trading range the last few weeks. Chart 1 shows IWM with a sharp advance from 59 to 71. The... READ MORE
There were some serious rumblings in the intermarket arena on Tuesday. Bonds plunged, long-term rates surged, the Euro declined sharply and the Dollar bounced. Forget about the Fed and QE2. These are already priced into the market. Bonds and the Dollar are looking ahead of QE2. Long-term rates are rising... READ MORE
After a trendline breakout in August, Vertex Pharma (VRTX) traced out a potentially bullish ascending triangle. Notice the higher low in early October and the equal highs in August and September. A break above the September high on good volume would confirm this bullish pattern. Click this image for a... READ MORE
DOLLAR TESTS 2009 LOW... The falling U.S. Dollar has been the driving force behind rising global stocks and commodities since the spring. And there's no convincing signs of any of those trends reversing (the 10- and 40-week moving averages for the dollar are still in bearish alignment)... READ MORE
Charts: AKS, ALTR, AMKR, HOLX, HRS, IDCC, MAS, POOL, WHR ----------------------------------------------------------------------------- This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think for ourselves when it comes to... READ MORE
I continue to watch bonds and the Euro for clues on equities. The first chart shows the Euro Currency Trust (FXE) surging on the open, but failing to break last week's high and falling back. It is possible that we have a lower high taking shape after last... READ MORE
MATERIALS SECTOR LEADS WITH A 52-WEEK HIGH... Link for todays video. The Basic Materials SPDR (XLB) continues to show leadership with a move above its October high today. Chart 1 shows XLB meeting resistance around 34.5 the last two weeks and then surging above 35 to forge a 52-high.... READ MORE
John Murphy's industry group perfchart shows oil services and internet stocks leading the market since August 27th. It's a rather motly pair. Banks are the biggest laggards. In a bit of a surprise, gold and silver stocks ($XAU) are also lagging the broader market. Click this... READ MORE
The Euro Currency Trust (FXE) and the S&P 500 ETF (SPY) have been positively correlated throughout 2010. This positive correlation is especially strong since late August. Both are up over 10% since late August. Why the positive correlation? First, a weak Dollar is beneficial to US exports because... READ MORE