The Big Picture shares an article from James Bianco entitled “The Dow is Distorted” which addresses some recent anomalies in the components in the Dow Jones Index. Specifically, Bianco argues that the Dow Jones is violating its own ‘unwritten rules’ that any stock that trades less than $10 per share will be excluded from the…
Caterpillar (CAT) announced today that it was laying off 20,000 employees, which sent the stock down to test the November lows and officially confirmed a Bull Trap that was sprung in early January. Let’s see Caterpillar (CAT) on the Daily Chart: I’ll leave the fundamental news to other websites and will only focus on the…
I had mentioned earlier that we were seeing relative strength in education stocks such as the Apollo Group (APOL) and ITT Education Services (ESI), both of which made fresh 52-week highs last week. However, Monday morning saw these stocks get clobbered in early trading. Let’s look at them and see this development. Apollo Group (APOL):…
Here’s a portion of the links I compiled for the NewsFlashr Business Blog Editor’s Picks this week (which are selected from the Business Blog section of NewsFlashr) with a few extra links here. Barry Ritholtz lists the “Six Errors” as written by Princeton Professor Alan Blinder (along with original source) and shares some of his…
With a very volatile week behind us, let’s step back and take a look at the XLF Financial Sector from its 2007 peak to present. XLF Financial SPDR: The XLF actually topped in May 2007, five months ahead of the October 2007 stock market top which underscores the assumption that Financials lead the broader market. …
As I mentioned earlier this morning, the US Equity Indexes are experiencing a strange phenomenon – let’s call it ‘Extreme Triangulation.’ It’s not actually a triangle, but price is being almost entirely contained within the range of the previous day, drawing price to a finely balanced zone. Let’s view this action from multiple sources. S&P…
Just an administrative note, we’re upgrading servers at Afraid to Trade.com as I’ve outgrown my current plan and am transferring the site to the new server upgrade which is complete. I’m sorry if you experienced an error page today. This will allow me to spread my wings more and provide better service to readers. If…
Let’s take a quick look at the intraday structure developing currently on Friday’s morning trading for clues to a possible range expansion move yet to come. S&P 500 15-min chart: I’ve been saying something is ‘off’ or ‘unhinged’ this week and now perhaps I have a better picture to explain that. As of 10:30am EST…
I thought I’d give one of my intraday posts a catchy title. Let’s get some insights from the intraday action and develop our experience in price behavior as we look at the intraday DIA action for January 22, 2009. DIA 5-min chart: The market began the day with a large-scale (over $1.00) downside gap which…
Often it can be helpful to analyze relative strength charts of key stocks or sectors to get hidden insights into possible future price moves or current structure. Analysts often use the ratio of the Consumer Discretionary Sector (XLY) to the Consumer Staples (XLP). Let’s see what this might mean and where this ratio is currently….