The Consumer Discretionary Sector is important to study for the broader implications for the economy and stock market. When the consumers spend, it is generally good for the economy and when they don’t (or hold back purchases), it’s not. Let’s look at the chart for the XLY, Consumer Discretionary Sector SPDR ETF (weekly): Notice the…
The last two days in the major market ETFs have shown gap opportunities, though the gaps have (yet) to close on both occasions. Also, interesting momentum impulses have developed which warrant an educational lesson. Let’s see: DIA (Dow Jones ETF) 5-minute chart: First, notice the purple ovals, which represent overnight gaps. While January was a…
The Financial Sector has experienced a bit of rampant volatility since 2008 began. Let’s look at two ten-day periods and see the absolute returns and how they differ for that period for the XLF sector ETF. Everything was rosy as could be from January 17th until January 30th, 2008: The Financial Sector (red bar on…
As I mentioned in last night’s post, I saw some bullishness underlying the market from the fact that the sellers were unable to take prices lower than 12,500 three times in the last week. Also, the classic bear flag which formed wasn’t resolving with any satisfaction, meaning that the pressure was building behind the scenes…
Let’s take a quick visual overview of some key market indexes and where they stand as of now. First, the US Dow Jones Index (daily): Classic technical analysis would be forecasting prices beneath 11,800 due to the perceived bear flag which has formed and has resolved halfway, but it seems like this hypothesis is currently…
With the US Dollar Index having made new lows, the price of gold has been making new highs. This makes sense from an intermarket relationship, but let’s take a recent look at the chart for more insights. First, gold’s weekly chart: Notice the triangle (not drawn) throughout 2006 which broke strongly to the upside in…
Old Dominion Freight Line (ODFL) recently experienced a major momentum impulse price move up, which resolved a growing positive divergence and has set up a Sweet Spot trade. Let’s see what this amazing stock has done in 2008: Notice that as price was experiencing resistance around $25.50, the momentum oscillator was showing positive conditions through…
In the weekly review of the S&P 500, there are some interesting chart points to note. Let’s look at the up to the minute charts: The daily chart is working off a new momentum low, which indicates a probability that the new price low has yet to come. The S&P and Dow Jones are both…
Could the US Dollar Index be forming a bottom? That is the $64,000 question, no doubt, but the index which has been marked down to new lows is now showing early signs of potential strength. Make no mistake, the US Dollar Index is in a confirmed daily (and weekly) downtrend, but price has managed to…
Dean Reese, contributor to the excellent and popular Trading Goddess blogsite, recently posted an article entitled “Playing to Win? Or Playing NOT to Lose” which underscored a major point I try to convey as well. Paul at The Market Speculator also posted an informative article entitled “Winners Trade to Win” which deepens the discussion beyond…