As I mentioned previously, the DJ Transportation Average is outperforming the Dow Jones Industrial Average, which generally is bullish for the overall market. Let’s peek inside the average to see which components of the Transports are doing the best. Let’s break it down into the Air Freight and Railroads, and their percentage performance since the…
How did you do on today’s Fed day? Days like this can remind us why volatile conditions can either be very rewarding or very draining for your account. Let’s see what happened and where the dust settled: On the intraday chart of the DIA, the Fed announcement (they cut .25 to 2.00%, as expected) came…
Rectangle consolidation patterns can lead to amazing profits and are relatively easy to recognize on a chart. Let’s learn more about this chart pattern. Eaton Corp (ETN) recently broke out of a rectangle consolidation pattern, which gives us an example of how we could trade such chart patterns. Sears Holding (SHLD) broke a long-term rectangle…
IBM has been roaring its way to new highs recently to levels not seen since 2000. Let’s see the chart of this impressive stock, which has made new highs as the stock market indexes fell in 2008. In fact, its lowest point this year was early January! Price broke above what can be considered a…
The DJ Transportation Index ($TRANS) is outperforming the Dow Jones index, which is an interesting development that has implications for Dow Theory. Dow Theory stresses the ‘confirmation’ between the DJ Transports and the DJ Index itself (meaning both must make a higher high to signal a ‘Buy Signal’ and vice versa). According to the theory,…
Not long ago, I discovered Andrew Horowitz’s website The Disciplined Investor which probably has become most known for its Podcasts. So far, Andrew has hosted 54 episodes and has addressed a wide variety of topics, including many interviews with fellow bloggers and financial minds in the industry. Most impressive to me, he recently interviewed former…
There’s an interesting confluence of support coming in on the Dow Jones and S&P 500 Averages. Let’s look: S&P 500: On both charts, three proposed trendlines have all come together to a point, which sits just under the current index prices. It’s interesting to have such a confluence. Also, the key 20 and 50 period…
In my trading, I utilize moving averages to determine trend, support/resistance, and price structure. The example today from the FOREX Australian Dollar / US Dollar cross (AUD/USD) showed an excellent example not only of how price can respect its key moving averages, but of momentum divergences as well: This is a 5-minute chart of the…
Can the relationship between 10 Year Note Yields and US Stock Prices reveal risk seeking and risk averse behavior of funds and investors? Earlier, I posted a few charts on the topic, so be sure to refresh with those for more information: Stock Correlation with the 10 Year Yield A Look at Bonds, Stocks, and…
Let’s look at the price positions of the US Dollar Index and the Dow Jones Index to gather clues about possible moves next week: First, the Dollar: The Dollar Index rallied (strengthened) last week, after forming a tight coil and has broken above its key 20 period moving average. Price is finding preliminary resistance at…