I’ve been hearing a lot of discussion about the “Death Cross” in the Russell 2000, particularly in the IWM ETF. Let’s identify what a “Death Cross” is and then test out prior performance of “Death Crosses” specifically in the IWM Russell 2000 ETF. Here’s a current chart – and we’ll step inside it all shortly:…
Electronic Arts (EA) surprised to the upside yesterday on earnings but failed to impress traders with tepid future guidance and we’re seeing a sharp gap-down and sell-off from the recent highs. Let’s take a look at this strong trending stock, note two prior ‘pullback’ scenarios, and chart the probabilities of what to plan now. Here’s…
Recent swings and reversals in commodity markets give us an example to study lengthy divergences and reversal trading tactics. Let’s take a look at these larger reversals, note the supply/demand shift, and the dual divergence chart signals that preceded these reversals (for lessons of identification and trading similar situations in the future). We’ll start with…
Savvy traders know to treat “Fed Days” differently than normal trading sessions while new traders often get tripped up by the sudden volatility or instant shift in the rhythm of a trading session. Let’s take a quick look at today’s “Fed Day” action and segment the day into “Before Fed” and “After Fed” to note…
I’ve been covering the price breakout and impulsive trend move up for Caterpillar (CAT) shares. Recently, shares reached a key price target which gives us a chance to study a quick lesson and plan the next potential swing for this Dow Jones stock. Let’s start with the Triangle Pattern Target that has been achieved (and…
Bull Traps are the enemy of Breakout Traders, and it’s important to learn the educational reference lessons when these scenarios trigger. Goal #1 is to protect yourself from escalating losses on a breakout opportunity that failed and Goal #2 (for aggressive traders only) is to profit from a trade outcome failure by playing into the…
With today’s Stick-Save intervention buying power propelling the market higher after a morning downside gap, let’s take a quick look at a few similar examples to compare what happened then to what may be playing out for the rest of the day. Doing this exercise can help you focus on concepts rather than the tiny…
For intraday traders, it’s often difficult to buy a strong stock in a strong intraday trend. The minute you buy will be the minute the trend reverses, you think. However, this can be an excellent strategy for new traders to practice, particularly when trying out trading pro-trend or retracement strategies. Let’s take a look at…
One of the greatest challenges as a trader is to determine whether a trend in motion is likely to continue or reverse. Reversing a trend is a process, similar to reversing a freight train, and a stock tends to signal reversals we can see on a price chart. Let’s take a closer look at four…
For intraday traders of stocks, ETFs, or index futures, it can be very advantageous to compare mini-trends in the NYSE TICK with the S&P 500 (or Dow, NASDAQ, or Russell 2000). One main way of studying TICK Trends is to spot a clear deterioration or visual trend divergence with price (the index) and the NYSE…