The Dow Jones Industrial Average, along with the broader S&P 500, is hovering dangerously close to full-bear technical territory. The daily chart is in a confirmed downtrend (as defined by moving average orientation and series of lower highs and lower lows), and is threatening to test the lows made in August which carved out a…
In the interest of Technical Analysis Education, let’s quickly look back at the year 2000 when the Dow Jones Index resolved a descending triangle to the upside. In technical analysis, traders often expect descending triangles to resolve to the downside and ascending triangles to resolve to the upside. StockCharts.com defines Descending Triangles as bearish formations…
I have returned after the Trader’s Expo in Las Vegas with new knowledge, new connections, and new information. For those of you who were unable to make it this year to Vegas but wanted to attend a Traders’ Expo, the next event will be held in New York City in mid-February. I truly recommend newer…
I’m excited to announce that I will be in Las Vegas attending the Traders Expo from Thursday, November 15th until Sunday, November 18th. This will be my fifth Traders Expo and I have loved each and every one of them, including seminars attended, contacts with other traders, product demonstrations, and everything. I even love Las…
The strength of today’s upwards action may have shocked some people, but let’s look at some factors that let us know today’s action wasn’t so surprising indeed. First, we were deeply oversold by most oscillator indicator readings (RSI, Stochastic, etc) on the US Index Daily Charts. Second, we experienced a large volatility, high momentum move…
E*Trade Financial Corporation (ETFC) plummeted 50% today after it reported that “deterioration in the value of its mortgage-backed securities has fallen significantly.” The stock had been in a recent downtrend on the daily charts (since August, 2007) and a fresh downtrend after a lengthy consolidation period on the weekly charts. From a 2007 high of…
Chris Perruna recently posted an excellent look at recent history’s corrections (which sometimes have been 10%) and then discusses full-blown bear markets and makes note of some key differences. Specifically, he pulls the camera back to the monthly charts which, I assume, a minority of active traders do. It is important to view the major…
Last week saw some extremely volatile and violent selling pressure hit many high-flying stocks and the broader indexes as well. A sell swing was imminent, but was deeper than most people anticipated. In the coming week, we have major economic announcements that will help set the tone for the market likely for the rest of…
Could we be on the verge of a new downtrend on the US Indexes? Let’s look at the past for some clues. Uptrends are defined as a series of higher highs and higher lows. Downtrends are defined as a series of lower lows and lower highs. To change an uptrend, price must first make a…
The implications from Sector Rotation Theory are showing more bearish/defensive themes are occurring with money flow across the nine major US Sectors. Over the last 65 days, energy prices led the charge with the greatest sector percentage increase, and we are seeing significant strength as well in the usually dormant utilities sector. Consumer staples (a…