One of the main activities that trip up traders, especially new traders, is the concept of continual price movement in one direction without meaningful pullbacks – also known as “powerful trends,” “creeper trends,” or “positive feedback loops.” Let’s take a look at the current situation and put it in the context of prior S&P 500…
Amazon’s (AMZN) chart structure is creating an interesting breaking point of tension between the higher and lower timeframes. While the daily chart argues for potential reversal higher, the weekly chart shows a barrier of overhead resistance that must be broken before a reversal higher can take place. It’s a good example of how to incorporate…
Following up with my prior inter-market post this week “Something’s Gotta Give,” let’s take a look at the sharp down-move that developed since then as seen in bond funds IEF and TLT. Let’s start with the 7 to 10-year Treasury Fund IEF: Quick analysis shows us a lengthy (mature) uptrend that is undercut by lengthy…
If you use Intermarket or Cross-Market Analysis in your trading or investment decisions, you’ve probably noticed something very strange over the last few months. Let’s take a look at “What’s Going Wrong” from a classic Intermarket perspective which leads us to “What’s Gotta Give” in terms of a building reversal. First, the closer perspective of…
Dual intraday divergences can be very helpful in pinpointing short-term turns (reversal) in price which create ideal low-risk, high probability trade set-ups for the intraday index futures or ETF trader. Let’s highlight a good example reference from today’s action on January 13th using the @ES Futures contract as our proxy. Click for full-size image. Without…
With traders focused on the S&P 500 at the round-number reference level of 1,300, let’s take a quick look at two competing classic price patterns that have formed into this critical level. Is the S&P 500 completing a short-term “Double Top” reversal pattern or an “Inverse Head and Shoulders” continuation pattern? Let’s look at these…
The S&P 500 is compressing between a shorter-term and broader consolidation pattern, so it could make for an interesting breakout resolution yet to come. Let’s take a look at the bigger picture of Market Structure and then zoom-in on the intraday structure to note key reference levels. First, the broader picture starting with 2011: To…
The fact that the S&P 500 “did nothing” in 2011 fails to take into account the performance of the individual sectors of the stock market, some of which returned as much as 15% in 2011. Let’s review Sector Performance in 2011, learn insights into the Sector Rotation Model, and see where capital flowed during the…
Will history repeat or will this time be different? That’s the famous question we’re all asking right now as Google shares break to new multi-year recovery highs not seen since late 2007. Let’s peek at the Weekly chart, note the key level to watch, and then compare that with what’s happening right now on the…
What a year it’s been! Unless there’s a major surprise in the next few days, the S&P 500 will end 2011 right where it began the year – at the 1,260 price region making this a stagnant year despite two big volatile periods. Let’s take a pre-end of year view of where the S&P 500’s…