Hey Fibonacci Enthusiasts: An interesting pattern occured in the Dow Jones Index that I thought was worth showing. Since March 19th, we have had (in order): A 5 day rally A 3 day decline (counter-rally) An 8 day rally These not only constitute perfect Fibonacci sequence numbers, but evidence of greater (recent) buying pressure in…
The second earnings season of the year is set to begin at the close today (April 10th) when Alcoa releases its earnings for the first quarter 2007. Other Dow and S&P components will release earnings this week and next as well, meaning that volatility and possible market gaps are likely if actual earnings differ from…
We survived the Jobs data to the upside, with positive surprises higher than expected. Perhaps the economy is doing better than expected? The Jobs Report is a lesson in how good news can be bad news for the market, and that a deeper level of analysis is required for proper market study. While there are…
Brett Steenbarger recently posted a link to four articles by Professor Andrew Lo that are helpful to trading. Dr. Steenbarger summarizes each article, and I recommend them also for deep reading on academic literature. Topics include academic studies on emotion, day trading, sentiment, risk taking, fear/greed, and randomness in the market. Dr. Andrew Lo’s website…
Do you feel overwhelmed with opportunities when you complete an evening scan of your charts? Adopt a simple quantification method to separate trade ideas into three categories for increased possibility of action, and decreased confusion. This method assumes that you scan various charts either on the evenings or on the weekends, and are looking for…
Following the surge Tuesday, the market is consolidating yet again, but this time the likely culprit is the upcoming holiday weekend (the Market will be closed Friday) and the release of the Jobs/Economic Report Friday morning. The report often swings the market quite forcefully in either direction, and for short-term traders, it is often best…
TickerSense recently posted the First Quarter Stock Market Returns sorted by Country, and the good news is that the United States is in positive territory for the first quarter. The bad news is that 65 (of the 87) countries (75%) beat the US stock market (S&P 500: up 0.18%) in the first quarter. Topping the…
We finally got the range expansion as expected in the major market indices, and the market has broken (again) to the upside as was also forecast, especially in light of the rampant negativity on the general state of the market. Is it surprising that, with all the negative sentiment around, the market rose yet again…
I am sounding like a broken record, yet so is the market. We have reached a clear equlibrium point and soon price will break one way or the other out of the consolidation we are experiencing. Remember, the longer the consolidation, the larger the move, yet it is difficult to predict which direction price will…
Sector Rotation Strategy can help you view the larger picture on money flows in the market and possibilities of where strong sectors will emerge. Regarding sector rotation, probably the best book I read on the issue, which helped me determine my strategy, is Peter Navarro’s “If it’s Raining in Brazil, Buy Starbucks.†Navarro introduces the…