I describe the market action before the opening bell and after the close and discuss set-ups for the next day.
It’s time for lower prices in the major US Indexes! So there are no guarantees, but the odds seem to favor a higher chance for more downside action in the short-term future. Let’s see why: First, the Dow Jones Daily Chart: Price failed at the confluence of the 20 and 50 EMAs Price formed a…
Today’s intraday price action gave us a major lesson in price patterns, volatility, and clean high probability trade set-ups. Let’s see what we could have learned today in the SPY. First, the day began with an overnight gap, which led to a stop-loss if you tried to trade back into the gap. Often, when a…
Popular stock Dry Ships Inc (DRYS) recently formed a major trend exhaustion (possible reversal) pattern that is worth further study. Let’s look at this pattern and what it may mean for the stock. Price rapidly increased from $20 to $130 throughout 2007, while collapsing at the end of the year, which brought us to the…
Yesterday, I examined the 10 Year Note, commenting that it had broken resistance. Now, let’s look at two bond funds to see how prices are being affected, and also view a strong correlation between the 10 Year Note Yield and the S&P 500 Index. First, the TIPS Bond Fund: iShares writes: The iShares Lehman U.S….
Today, the yield on the 10 Year Note sliced upwards through its declining 200 day moving average, signaling a potential reversal in trend and the possibility of higher rates yet to come. Daily Chart ($TNX): After forming a strange sort of double bottom, complete with a positive momentum divergence, the yield, now just under 4.1%,…
Let’s do a quick check on Wachovia Bank and the XLF Financial Index to see what interesting development has happened this week. First, Wachovia’s (WB) weekly structure chart: Price made a new intra-week low this week, testing just below $24 per share, but it did so on a developing positive momentum divergence (not drawn). The…
If you’re following the intraday charts, momentum seems to be diverging to the upside as selling pressure is waning and buying pressure seems to be picking up, as the shift from supply to demand is comfortably shifting. Let’s look at the 30-minute chart of the DIA: Although it’s clearly a short-term shift, we see at…
Often, the Foreign Exchange currencies markets (FOREX) offer cleaner trends and simple set-ups for astute traders, and I wanted to show an example of one of these clean examples that occurred last night on the Euro/US Dollar cross. (Click for full size image) Even if you don’t trade FOREX, the patterns in this chart are…
Let’s jump right into the intraday action and ideal trades (looking from the benefit of hindsight) that formed throughout the day. Let’s examine a new format, using the Dow Mini futures contract (@YMM08) viewed using what I see each day on TradeStation: (Click for full size image) Price was already on a move down when…
Let’s take a look at the recent sector money flow performance to see if we can glean any clues for the broader market, especially regarding risk-seeking or risk-avoiding behavior by larger funds. The 10 day rotation has taken money into the areas traditionally known as ‘defensive’ sectors, including Health Care, Consumer Staples, and Utilities. Energy…