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At The Top of Channel August 24, 2018

Posted by Tom in Thoughts.
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Aug. 24, 2018 – OK, here’s where it gets interesting.  Note the chart below: we closed at / near the top of the channel.  This is where the market has recently bounced lower & headed “south”.  So next week as we head into the (US) holiday weekend, will it bounce lower or continue higher?  We’ll have to wait but I do note Price Strength and Volume Flow heading higher.

Volume lately has been anemic but late in the week it did pick up.  The question remains: will this strength follow through next week.  Support & Resistance levels remain the same and will serve as a guide.

Else where, I get a monthly e-mail from his site: www.automated-trading-system.com/trend-following-wizards-june-2/ , which puts out performance figures on some large “trend following” CTAs (Commodity Trading Advisors).  Many of these are well known in the industry, and I find it interesting to benchmark myself off of these guys.  With hundreds of millions of $ (or more) under management they make a heck of a lot more in fees than I can even imagine.  Check out the website & subscribe (it’s free).  In the mean time, here’s the report for June and Year To Date.
Hopefully you can read this OK or blow it up.  I find it interesting.

I see strength in Healthcare, Government Bonds (yes, hard to believe), Consumer Services and Pharmaceuticals.  My dominate index is Small Cap. Growth.  I’m being a bit careful here as we approach a channel & market top, but ready to commit more in either direction.  My stock positions are 90% full, so hedging is my insurance if we drop.

Take Care & have a good week.   …………  Tom  ………….

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

Range Bound August 19, 2018

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Aug. 17, 2018 – A quick look at the chart below shows why this market is range bound; i.e. bouncing between high & low price levels.  Note the “short term” trend channel and the support and resistance price levels are nearly the same.

NASDAQ

This market is looking for a reason to go up or down, but can’t find the follow through to break out of this range; at least not yet.  Echoing that idea is the rather low volume . . . not much commitment in either direction.

Looking at the top performing sectors (below) we really don’t see the typical leadership; that being Finance or Tech or Energy.  So the major sectors are on vacation too.

Top Sectors

Looking at the percent of stocks in the broad S&P 1500 Index and their status we note it being fairly even without much bias in either the Bullish or Bearish direction:

Price Strength –

Price Strength

Stocks in Accumulation or Distribution –

A-D

So, overall not much to dwell on for now.  The old saying “Never short a dull market” may have some validity here because this appears to be more of a pause.  Keep an eye on these levels and watch for volume confirming any directional change.

That’s about it for this week.  Take Care.    ……….  Tom  ………..

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

Summer Doldrums ? August 11, 2018

Posted by Tom in Thoughts.
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Aug. 10, 2018 – This is another short post as I’m winding up my “road trip”.  A short look at the chart below shows some very narrow range bars from Tuesday through Friday of last week.  We’ve bounced off the previous swing high and now that swing high is resistance to future price increases. That resistance is at the 7933 level on the NASDAQ Composite Index (green line).

Support of prices are at the 7604 level (red line).  These are our “lines in the sand” and represent where buyers and sellers have previously taken a stand.  I own personal feeling is that this market has entered into a trading range, a.k.a. the summer doldrums”.  Hey, it’s August and many of the big guys are on vacation.  Likely not much will happen until after Labor Day.   . . . . . unless a big news item comes along.  This administration appears to be trying to solve problems by edict . . . . and that doesn’t appear to be working out well in the short term.  (i.e. tariffs)

Where I see some strength is in Pharma, short China, short Gold, Wireless and Healthcare.  Banks and Financials bring up the rear.  So, let’s be a little patient for now, but be careful also.

That’s it for this week.  Have a good week.       ……………….  Tom  ……………

Within the Channel -Trend Continues August 5, 2018

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Aug. 3, 2018 – I’m taking a short vacation but never “away” from the markets, but these posts will be brief.  Looking at the chart below we see that the broad NASDAQ Composite Index did the “predictable” in that it broke to the lower trend channel line and reverted higher.  Now . . . . looking at Fridays bar (the last one on the chart) we nore it being a very narrow range bar; indecision.

NASDAQ

Investors are unsure as to buy or sell into this short term rally.  The 7604 level is now support and the 7933 is now resistance.  A break below 7604 spells problems, especially if volume (selling) increases.  The 7933 level is the previous high, which is where selling appeared.

So, we’re really at or near a crossroad where this market could show it’s hand into the Fall.  Friday showed us that indecision.  What this market needs is leadership and a reason to bring buyers into the market.  Here’s a listing of current market sector strength in the short term:

Sectors

Have a good week.       ………..  Tom  ……………

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