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Break Out or Fake Out ? April 29, 2017

Posted by Tom in Thoughts.
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April 28, 2017 – No doubt that this past week the market broke out of the trading range that has persisted for over a month.  Higher bars on increased volume, market sentiment back to Bullish and money flowing into the markets.  All generally good news, which likely is being fueled by good earnings reports.

So far a little over half of the S&P 500 companies have reported, and of those, 77% have beat earnings estimates and 70% showed increasing sales revenues that were above forecast.  Pretty good news corporate wise all around.

This is looking more like a “stepping stone” pattern inside of an overall bullish price structure.  I’ve moved price support levels up and trend lines to reflect that.  I think it’s still a wise thing to look out for a distribution bar on heavy volume, just in case.  Geo-politically, there’s a bunch of things that could cause it.

The pie chart below shows sectors that I’m prospecting for stocks.  In addition to Wireless and Internet stocks, there is strength in Internationals (especially European), Consumer Services and Technology.

So I’m “cautiously Long” right now, building a few more positions and still a little concerned about the investing environment in general.  Have a good week.     …… Tom …..

Price chart by MetaStock; pie chart & table by http://www.HighGrowthStock.com. Used with permission.

Well Within (trading) Range April 22, 2017

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April 21, 2017 – This week we saw the markets clip the lower edge of the trading range then bounce back up.  The chart below of the NASDAQ Index shows the directional indecision in this market.  There is just too much going on, or potential to happen, to have investors feeling very confident.

And so we wait for the outcomes of the French elections (1st round), Congress on tax cuts / healthcare (round 2), North Korea nuclear testing, big Tech companies report earnings next week etc.  I’m still looking at the 5769 level as a major support for this market.  If we are to go higher, we’ve got to see conviction; higher prices on high volume , over multiple days.  But, beware of the Up Thrust bar on low volume, closing near the low.

Price have improved overall.  The stocks in the S&P 1500 Index are showing more “green” / up movement.

Here are the sectors that I’m monitoring for a break higher:

(click on any graphic to enlarge it for easy viewing)

Right now I’m rather neutral, part invested, part in Cash.  It’s good to be able to go in either direction, especially now.   Have a good week.  ….. Tom  …..

Price chart by MetaStock; pie chart & table by http://www.HighGrowthStock.com. Used with permission.

Market Getting Closer to Thin Ice April 14, 2017

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April 13, 2017 – More and more of my indicators are turning down now.  Volume is low (lack of demand) and prices are dropping because of that; buyers are not stepping in right now.  Are all of the “willing buyers in” right now, and there is no one left to buy ?  Doubtful in the overall picture but there is all sorts of news to make folks concerned about the immediate future.

Earnings have begun to come out and this market has not been inspired by them even thought the bank earnings have been pretty good.  The NASDAQ Composite Index (above) needs to hold above 5769, otherwise we’ll likely see a very low & slow summer.

I’m not looking to add any positions, but let’s look at the very broad S&P 1500 stocks.

Buying / Selling Pressure:

Price Strength:

Have a Happy Easter !         ……. Tom ……

Market Waiting April 8, 2017

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April 7, 2017 – Looking at the chart below we’ve broken the upward trend channel and have settled into a fairly narrow trading range.  I’ve labeled the chart as a possible Distribution structure to be on the cautious side.

Money and Volume flows are muted and rather neutral; there isn’t much buying or selling lately.  I’ve moved my support price level up just a little to 5769 on the NASDAQ Composite Index.  that’s were the last “buying” started on a weekly basis.  Last Wednesday could be labeled as a UTAD (up thrust after distribution), but that case is not very strong.   Market Sentiment is weak, especially when compared to where we’ve come from.  Volume on Thursday & Friday was low, not much activity in either direction.

Earnings reports begin week of 4-24, and that’s what this market is waiting for.  Prices are fairly rich so any significant disappointments or forward guidance surprises could generate a swift reaction lower.  Without any indication as to the trend, I’ve got to stay neutral and raise Cash as support levels are broken.  The stocks in the broad S&P 1500 Index are split down the middle and don’t show much of a bias in either direction:

Price Strength –

Accumulation/Distribution –

This is a rare time when I’m really not seeing any edge or strength in any sector.  Sure Precious Metals lately, but the action has been very erratic; Utilities, very muted trend; Technology, not a clear trend.  Sector wise I’d rather be waiting in Cash.

Have a good week.   …….. Tom  ……..

Price chart by MetaStock; pie chart & table by http://www.HighGrowthStock.com. Used with permission.

 

Market Neutral April 1, 2017

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March 31, 2017 – I want to see a UTAD (Up Thrust After Distribution) so bad, and it may well happen yet, but for now I’ve got to call it “Market Neutral”.  The market is struggling to climb the lower trend line, narrow bars on modest volume.  But it is holding on right now.

Sentiment has improved to “neutral” and both Money & Volume Flows are holding onto a light Bullish posture.  We’re just going to have to wait and see what pushes this market higher or lower.  Earnings season starts with Alcoa on April 10th and it just keeps rolling for the next 3 weeks for the “big guys” to report and guide.  Political news is a wild card in the whole thing.  I’m keeping an eye for either a rush to the exits or a more positive “all clear”.  Make no mistake, this market is expecting very good things.  A case could be made that it is over price and due for some correction, but the markets run on expectations, and not reality (until it can’t be deigned).

I’ve got to go, a busy weekend, but here’s the market sectors that I’m watch for strength:

In the mean time, I’ll watch for an up thrust bar (to a new high), on light volume, followed by a big down bar (wide range) on heavy volume.  Right now I’ve lighted up on some holdings that are showing weakness, waiting for more proof in either direction.

Have a great week.          ……….  Tom  ……….

Price chart by MetaStock; pie chart & table by http://www.HighGrowthStock.com. Used with permission.

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