Thursday, January 11, 2007

Technical Indicators

Accumulation/Distribution Line

The Accumulation/Distribution Line was developed by Marc Chaikin to assess the cumulative flow of money into and out of a security. He decided to focus on the price action for a given period (day, week, month) and derived a formula to calculate a value based on the location of the close, relative to the range for the period. This is the "Close Location Value" or CLV. The CLV ranges from plus one to minus one with the center point at zero.

The signals for the Accumulation/Distribution Line are fairly straightforward and involve divergence or confirmation. A bullish signal is given when the Accumulation/Distribution Line forms a positive divergence. Be wary of weak positive divergences that fail to make higher reaction highs. A two-week positive divergence should be suspect. However, a multi-month positive divergence deserves serious attention...


Trading Ideas & Picks

Occidental Petroleum Corp - OXY - Below an influential trendline

OXY: Recent weakness in the oil and gas sector has caused the stock to fall below an influential trendline on above average volume. The ascending trendline has been able to provide support for OXY since early 2004, but the recent break below suggests that we could see a further pullback...

Trading Picks - Read More

Trading Education Tutorial

Volume Climax

Volume Helps Identify Reversals

Various price patterns can alert us to potential reversal candidates. Trendline Breaks, Support and Resistance Levels, Fibonacci Retracement Levels and other price information are valuable in determining a change in direction for a security. However, one of the most overlooked chart patterns that help us determine reversals is not reflected in the price itself. Volume climaxes are easily identifiable and valuable in assessing a change in market sentiment.


NASDAQ Chart of the Day

IVGN is getting a solid upside break through the top of a clear triangle consolidation at 57.75, which is quite bullish. Watch for continued strength out of this pattern.

Daily Trading Signals

NYSE Chart of the Day

DNR is holding at major support at 25.95, which has held for many months. Watch this level for a big break or bounce for the next key move. Watch 27.25 up, and 25.75 down.

Daily Trading Signals

Daily Market Commentary

Updated Wednesday, 1/10 for Thursday's market.

Key DOW Levels for 1/11


Above 12,475


Below 12,350

Reversal from Lows...

- Dow bounces higher from key support yet again, but remains within tight consolidation range. The index reversed course and rallied slowly to the Close to end the day with a 26 point gain.

- The NASDAQ continues to lead the way higher, but the broader market has been reluctant to push in either direction over the last four or five days of trading. Look for the NASDAQ to remain strong with the S&P finally agreeing with move.


The Dow ended the day with a nice rise from the session's lows after being rebuffed by key support at 12,350 yet again. Look for the index to finally get a big breakout opportunity through 12,465 tomorrow.


This page is powered by Blogger. Isn't yours?