Friday, February 09, 2007

 
Technical Indicators

Standard Error Bands

Created by Jon Anderson, Standard Error Bands are two moving averages based on standard error levels above and below the Linear Regression Indicator. As a type of envelope, they are similar in appearance to Bollinger Bands but are calculated and interpreted quite differently. While Bollinger Bands are plotted at standard deviation levels above and below a moving average, Standard Error Bands are plotted at standard error levels above and below the linear regression plot.

Andersen recommends default values of "21" for the number of periods, a 3-day simple moving average for the smoothing, and "2" standard errors. He also notes that very short time frames tend to produce unreliable results.

Because the spacing between Standard Error Bands is based on the Standard Error of the security, when the two bands are close together, it signifies a strong trend. When the two bands are far apart, prices are more volatile and will tend to fluctuate between the two bands. If the bands are close and then begin to widen, it may signify that the trend is weakening and may possibly be due for a reversal...

Read More...

 
Trading Education Tutorial

Elliott Wave Theory

In the 1930s, Ralph Nelson Elliott found that the markets exhibited certain repeated patterns. His primary research was with stock market data for the Dow Jones Industrial Average. This research identified patterns or waves that recur in the markets. Very simply, in the direction of the trend, expect five waves. Any corrections against the trend are in three waves. Three wave corrections are lettered as "a, b, c." These patterns can be seen in long-term as well as in short-term charts. Ideally, smaller patterns can be identified within bigger patterns. In this sense, Elliott Waves are like a piece of broccoli, where the smaller piece, if broken off from the bigger piece, does, in fact, look like the big piece. This information (about smaller patterns fitting into bigger patterns), coupled with the Fibonacci relationships between the waves, offers the trader a level of anticipation and/or prediction when searching for and identifying trading opportunities with solid reward/risk ratios.

There have been many theories about the origin and the meaning of the patterns that Elliott discovered, including human behavior and harmony in nature. These rules, though, as applied to technical analysis of the markets (stocks, commodities, futures, etc.), can be very useful regardless of their meaning and origin...

Read More...

 
Daily Market Commentary

Updated Thursday, 2/8 for Friday's market.

Key DOW Levels for 2/9

P

Above 12,700

DN

Below 12,550


Drop & Pop...

- Dow drops through support, but recovers to the Close. The index closed out the day with a 29 point loss, but continues to look very indecisive at present.

- The NASDAQ and S&P each pushed lower early in the day, but led nice upside reversals to the Close. Look for the indexes to continue to build out at highs ahead of the next key breakout move.

Summary

The Dow ended the day with a nice recovery from the session's lows. The index continues to wind up beneath the key 12,700 level and could eventually approach a big breakout opportunity soon. Watch 12,700 and 12,550 for big moves.

Read More...

Thursday, February 08, 2007

 
Technical Indicators

Polarized Fractal Efficiency

Developed by Hans Hanula, the Polarized Fractal Efficiency indicator draws on Mandelbrot and fractal geometry to illustrate the efficiency of how pricing moves between two points over time. The more linear and efficient the price movement, the shorter the distance the prices must travel.

Use the PFE indicator to measure how trendy or congested the price action is. PFE readings above zero indicate that the trend is up and the higher the reading the "trendier" and more efficient the upward movement. PFE readings below zero mean that the trend is down. The lower the reading the "trendier" and more efficient the downward movement. Readings near zero indicate choppy, less efficient movement and a balance between supply and demand.

Read More...

 
Trading Ideas & Picks

Swing Trade of the Week

AZO: Stock surged past a resistance area with a bullish green candle, then traded at the upper end of the bullish breakout candle, representing a consolidation and possible setup for further upside. Look to go long at 128.01...

Trading Ideas - Read More

 
Trading Ideas & Picks

Graco Inc- GGG - Support of a long-term trendline

GGG: The stock is nearing the support of a long-term trendline. Many traders will pay close attention to this trendline because a move below it would be a technical indication of a reversal in the long-term uptrend...

Trading Picks - Read More

 
Trading Education Tutorial

Double Tops and Bottoms





Waiting for the Setup to Complete Results in Profits

There are various chart patterns that help us find good reversal candidates. Of the major reversal patterns, the double top or bottom is not only one of the most recognizable, but also one of the most predictive.

Read More...

 
NASDAQ Chart of the Day




MEDI took a big gap down through a major lower trend line at 33.00, which looks highly bearish, especially given the increased volume on this move. Watch for more selling ahead.

Daily Trading Signals

 
NYSE Chart of the Day




HLF has pulled back sharply from key resistance at 41.25 several times since last summer. The stock now looks maxed out beneath resistance yet again and has built out a bearish exhaust gap pattern. Watch 38.00 for more weakness.

Daily Trading Signals

 
Daily Market Commentary

Updated Wednesday, 2/7 for Thursday's market.

Key DOW Levels for 2/8

P

Above 12,700

DN

Below 12,620


12,700 Holds...

- Dow rallies to 12,700, but is rejected back to near-term support. The index ended the day with a 1 point gain and continues to build out ahead of the next big breakout move.

- The NASDAQ and S&P each pulled back from the day's highs, but not to the extent of the Dow, which indicates further overall strength. Watch key near-term support for key directional move ahead.

Summary

The Dow closed the day with a big bounce from lows and is now holding within the boundaries of the key consolidation range. Look for a solid breakout from this range for the next big move.

Read More...

Wednesday, February 07, 2007

 
Trading Education Tutorial

Measured and Exhaustion Gaps





Identifiable Patterns After Confirmation Move

We have previously mentioned the three types of gaps that are of relevance to investors - the breakaway gap, the measured (or continuation) gap, and the exhaustion gap. We previously discussed the breakaway gap, but it is important to discuss the measured gap and exhaustion gap at the same time. Why? Because it is difficult to tell one from the other until after the fact.

Read More...

 
NASDAQ Chart of the Day



OSTK got a huge upside break from a tightly-wound triangle range at 16.00, which sparked big strength to the upside. Look for more strength from this stock, especially if it continues to hold above 16.00.

Daily Trading Signals

 
NYSE Chart of the Day




WMI is holding at a major resistance level at 38.70, which has held firmly since May of last year. If the stock cannot rise above this zone, we will likely see a big downside push away from it. Watch 37.50 for early signs of weakness.

Daily Trading Signals

 
Daily Market Commentary

Updated Tuesday, 2/6 for Wednesday's market.

Key DOW Levels for 2/7

P

Above 12,700

DN

Below 12,620


Consolidating...

- Dow trades sideways throughout session, builds out clear range. The index closed the day with a 5 point gain, but is clearly gearing up for a big breakout from this consolidation pattern.

- The NASDAQ led the market lower to begin the day, but eventually rebounded to the Close. The S&P continues to build out a clear range that will surely factor into direction.

Summary

The Dow continues to build out within the boundaries of the clear rectangle consolidation, which could spark the next big move. Watch 12,620 and 12,685 for early direction.

Read More...

Tuesday, February 06, 2007

 
Technical Indicators

Directional Movement Index (ADX)


Directional Movement helps determine if a security is "trending." Developed by Welles Wilder and explained in his book, New Concepts in Technical Trading Systems, it can be used either as a system on its own or as a filter on a trend-following system.

Two lines are generated in a DMI study, +DI and -DI. The first line measures positive (upward) movement and the second number measures negative (downward) movement. A buy signal is given when the +DI line crosses over the - DI line while a sell signal is generated when the +DI line crosses below the - DI line.

Read More...

 
Trading Tools

With VisualTrader, you will know when the market is turning, which industry groups are leading the stampede, and which charts have the best setups.

OmniTrader gives you the power to make decisions fast! It gives you real trading signals with all of the supporting information automatically displayed for you.

Chart Pattern.com

Daily Trading Alerts

Swing Trades.com


 
NASDAQ Chart of the Day




GOOG got a big downside break from the large triangle range at 480.00 today and is poised to head much lower. Given the geometry of the triangle, this stock could move about 60 points from the breakout point, which puts the target at about 420.00.

Daily Trading Signals

 
NYSE Chart of the Day




UCO got a big upside break through a major resistance level at 65.40 via a large breakaway gap and increased volume. Look for more strength from this stock above 65.40.

Daily Trading Signals

 
Daily Market Commentary

Updated Monday, 2/5 for Tuesday's market.

Key DOW Levels for 2/6

P

Above 12,700

DN

Below 12,620


Still Holding...

- Dow trades quietly sideways throughout session, builds out tight consolidation. The index has done a good job so far in holding above the major 12,600 resistance level, but we also need to see more bullish movement ahead. Otherwise, the index is still vulnerable to another potential sell-off.

- The NASDAQ and S&P each continue to hold within their respective consolidation ranges. Each looks to be gearing up for another big move, but look as though they are favoring a downside break. Watch the current ranges for key direction tomorrow.

Summary

The Dow continues to hold at the overall highs above the key 12,600 resistance level. The index has managed to hold above this zone for three straight days, which is promising looking forward. Continue to watch the key 12,620 zone for clear direction.

Read More...

 
Daily Market Commentary

Updated Monday, 2/5 for Tuesday's market.

Key DOW Levels for 2/6

P

Above 12,700

DN

Below 12,620


Still Holding...

- Dow trades quietly sideways throughout session, builds out tight consolidation. The index has done a good job so far in holding above the major 12,600 resistance level, but we also need to see more bullish movement ahead. Otherwise, the index is still vulnerable to another potential sell-off.

- The NASDAQ and S&P each continue to hold within their respective consolidation ranges. Each looks to be gearing up for another big move, but look as though they are favoring a downside break. Watch the current ranges for key direction tomorrow.

Summary

The Dow continues to hold at the overall highs above the key 12,600 resistance level. The index has managed to hold above this zone for three straight days, which is promising looking forward. Continue to watch the key 12,620 zone for clear direction.

Read More...

Monday, February 05, 2007

 
Technical Indicators

Fibonacci Retracements

Fibonacci Retracements are displayed by first drawing a trendline between two extreme points, i.e. a trough and opposing peak. A series of horizontal lines are drawn intersecting the trendline at the Fibonacci levels.

After a significant price move in either up or down direction, prices will often give back a significant portion (if not all) of the original move. As prices retrace, look for support and resistance levels often occurring at or near the Fibonacci Retracement levels.

Read More...

 
Trading Ideas & Picks

Weekly Swing Ideas Report for February 5th - February 9th

Stock Picks - Long and Short Potential Swing Candidates ... SwingTracker Scans: Trading Window, Force Swings (CMX,Caremark Rx, APA,Apache Corp, RDC,Rowan Cos, SAI,SAIC Inc, THE,TODCOA), Triangle (C,Citigroup Inc, WFT,Weatherford Intl, UDR,United Dominion Rlty Tr, ZOLT,Zoltek Co, NCR,NCR Corp), Revival, Reversals (ERIC,Ericsson(LM), OCNW,Occam Networks, WPL,W.P. Stewart Ltd), and more...

Trading Ideas - Read More

 
Would You Like To Own A System So Accurate, So Consistent And So Powerful, It Will Literally Remove All Traces of Fear And Doubt Every Time You Take a Trade...?

Then this is your Opportunity


Ultimate Trading Machine

UTM is brand new and exciting trading tool. Forex and E-mini's are the hottest markets today.

If you'd like to know what works, and what doesn't, common myths busted for good, the top Q&A active traders are burning to know the answers to and much more, you need to see this. No other way to put it.

CLICK to Download FREE Video NOW!

UTM has ZERO subjectivity. Ten people use it, ten people get the SAME results. This is a huge advantage over 99% of the other systems.

Ultimate Trading Machine - Limited Edition

 
Daily Stock Picks

Bottoming -

Feb 2 for Feb 5:
AVAV ESEA FRPT GNSS OCNW PXLW

(
Stocks making a 52 WK low but closing higher than they opened)


Oversold Stocks
-

Feb 2 for Feb 5:
ECIL RDWR

(Stocks closing higher than they opened, crossing up through their 25 Stochastic level, and on 150% + greater than average 6 month volume)


Volume Pop
-

Feb 2 for Feb 5:
MSPD NMSS OLGC TMTA XOMA ZICA ZIXI

(Volume Pop With High ADX & RSI)


More... Stock Picks Page #1

 
Trading Ideas & Picks

The QQQQ Report for February 5th - February 9th

QQQQ: Relative Strength Index has been creating a series of new lows while the QQQQ has continued to move sideways. This negative divergence is another technical sign of traders' lack of conviction of a move higher...

Trading Picks - Read More

 
Daily Market Commentary

Updated Friday, 2/2 for Monday's market.

Key DOW Levels for 2/5

P

Above 12,700

DN

Below 12,600


Holding...

- Dow holds throughout session, gets bullish lift to the Close. The index closed the day out with a modest 20 point loss, but looks to be building out the framework for a potential continuation pattern above 12,600, which would be bullish.

- The NASDAQ and S&P each traded quietly sideways today, but look primed for another big week next week. Watch the key triangle pattern in the NASDAQ for early direction Monday.

Summary

The Dow closed the day quietly lower today, but the index continues to maintain its stance above the key 12,600 zone, which is the clear fulcrum in the charts. Watch this level for key direction next week.

Read More...

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