Thursday, August 30, 2007

 
Technical Indicators

Moving Average, Triple Exponential

The Triple Exponential Moving Average (TRIX) is an oscillator used to identify oversold and overbought markets as well as a momentum indicator. For use as an oscillator look for a positive value to indicate an overbought market and a negative value indicate an oversold market. When TRIX is used as a momentum indicator, a positive value suggests increasing momentum just as a negative value suggests momentum is decreasing. Some believe that the TRIX crossing above the zero line is a buy signal and a closing below the zero line is a sell signal. Divergence between price and TRIX can also indicate significant turning points in the market.

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Trading Education Tutorial
Courtesy of Nirvana Systems

Volatility



Well Behaved Stocks Reap Rewards

Some stocks move multiple points and multiple directions in one trading session. Other stocks are more methodical in their day-to-day movement. Which type of stock is more attractive to you as an investor?

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NASDAQ Chart of the Day
Courtesy of Nirvana Systems




COST is winding up within tight triangle pattern that could offer an explosive breakout move. Watch 61.50 up, and 59.00 down for the next key breakout move.

Daily Trading Signals

 
NYSE Chart of the Day
Courtesy of Nirvana Systems




NUE has formed a potentially bullish inverted head-and-shoulders pattern with a clear neck line (resistance) at 56.00. A break through this level could send the stock back toward 65.00.

Daily Trading Signals

 
Daily Market Commentary
Courtesy of Nirvana Systems

Updated Wednesday, 8/29 for Thursday's market.

Key DOW Levels for 8/30

UP

Above 13,400

DN

Below 13,300


Big Reversal...

- Dow reverses from yesterday's lows, rallies strong into the Close. The Index rallied early in the day, formed a higher low and then rallied strong the rest of the day, eventually closing the session with a solid 247 point gain.

- The NASDAQ and S&P each rallied from yesterday's lows and closed the day at session highs. Each index looks poised for another test at the major upper trend line, which we will watch closely tomorrow.

Summary

The Dow closed the day with a very nice rally into the Close, as the index covered 170 points in the final 2 hours of the day. The index is now winding up within a potentially explosive triangle that we will continue to watch tomorrow.

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Technical Indicators

Zig Zag

The Zig Zag indicator shows past performance trends and only the most significant changes. It does this by filtering out any changes less than a specified amount.

The Zig Zag indicator is used primarily to help you see changes by highlighting the most significant reversals. Understand that the last segment in a Zig Zag chart can change based on changes in the underlying plot, price being only one example. That is, a change in a security's price can change a previous value of the indicator. Since the Zig Zag indicator adjusts its values based on subsequent changes, it has perfect hindsight into what prices have done. Do not try to create a trading system based on the Zig Zag indicator, as it to be used to illustrate historical patterns.

The Zig Zag indicator is calculated by placing imaginary points on a chart when prices reverse by at least the specified amount. Straight lines are then drawn to connect these imaginary points. Any changes in prices that are less than the specified amount are ignored.

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Trading Education Tutorial
Courtesy of Nirvana Systems

Trading Ranges




Big Moves Occur Outside of the Range

A trading range is basically a horizontal channel in which a security moves from the high and low of the channel for an extended amount of time. Obviously, the upper level of the range can be considered resistance and the lower level represents support. Trading within a range is possible, but it's the breakout from the range that provides the best opportunities.

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NASDAQ Chart of the Day
Courtesy of Nirvana Systems




ALXN is testing support at 56.50, which happens to be the neck line of a clear head and shoulders pattern, which is typically a very bearish pattern. Look for more weakness should 55.25 be crossed.

Daily Trading Signals

 
NYSE Chart of the Day
Courtesy of Nirvana Systems




RRI has formed a large head-and-shoulders pattern that could spark a big decline ahead. This pattern has formed at highs over the last several months, developing a clear neck line at 23.65. A break through this zone could spark a sell-off of about 7 points.

Daily Trading Signals

 
Daily Market Commentary
Courtesy of Nirvana Systems

Updated Tuesday, 8/28 for Wednesday's market.

Key DOW Levels for 8/29

UP

Above 13,400

DN

Below 13,000


Heavy Sell-Off...

- Dow sells off early, drops hard into the Close. From prior commentary, "...The fact that the Dow has rallied from 12,500 and stopped precisely at this upper line indicates many traders are watching this level. If the Dow cannot rise above this zone with follow-through, we will likely see another wave of selling to new lows..."

The Dow opened the session with selling right from the beginning, which never let up the rest of the session, as seen across all timeframes. The Dow dropped significantly from the major upper trend line at 13,400 and sold off heavily back toward the 13,300 level, as seen int he Daily and 60 Minute Charts. The Dow ended the day with a big 280 point loss, but several more days of heavy selling could be seen.

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Monday, August 27, 2007

 
The brand NEW Universal Market Trader!
Stocks, Futures & Forex, both for Daytrades and Swing trades


Fellow Swing Trader,

NetPicks will be pulling the product off the market at exactly 5pm EST today (New York Time) 2pm PST. The order links will come down, the chance to own it, gone for now.

It is 2 days earlier than they wanted but the demand was strong as expected.

This is the last chance to get your copy. It may return, but it will be a while, and very possibly not at the introductory pricing.


Click for Universal Market Trader


As this will be the last you will hear about this release, here's the most recent performance:

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To give you an idea of the most recent possible performance, let's look at Friday, August 24th. Trading just one hour on the Russell e-Mini yielded +4.80 Points ($480 before costs per contract), S&P e-Mini in the morning session +5 Points ($50 per point per contract), Dax Futures a quick two trades for +28 points which is almost $900 per contract before costs and Crude Oil one long trade gained +0.49 which at $10 per tick is worth $490 per contract traded. And, how about a swing trade on the Wheat futures - something totally different? Just hit target on a buy that went 34 points, and $50 a point means over $1,500 per contract on this swing trade. You can see the versatility between markets and day or swing trading and you are about to empower your trading at this level.

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Technical Indicators

Ease of Movement

The Ease of Movement Indicator was designed to illustrate the relationship between volume and price change. It shows how much volume is required to move prices.

High Ease of Movement values occur when prices are moving upward with light volume. Low values occur when prices are moving downward on light volume. If prices are not moving or if heavy volume is required to move prices then the indicator will read near zero.

A buy signal is produced when it crosses above zero (an indication that prices are more easily moving upward ). A sell signal is produced when the indicator crosses below zero (prices are moving downward more easily)...

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Trading Education Tutorial
Courtesy of Nirvana Systems

Moving Averages and the Trend




Moving Averages Help Us Identify Trend Reversals

One of the old axioms of technical analysis is that 'the trend is your friend'. This holds true, as long as you trade in the direction of the trend. However, your 'friend' has two faces, and can turn on you to eliminate profits (and your friendship!). Trend reversals can occur at any time and one of the important skills a trader must possess is the ability to identify a reversal. It is easy to exit a position too early if we over-anticipate a trend reversal, and just as easy to watch our profits evaporate if we are too slow to exit the trade.

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NASDAQ Chart of the Day
Courtesy of Nirvana Systems




MENT finally broke a major upper trend line to the upside via a big breakaway gap through 13.35. This breakout could lead to a serious uptrend.

 
NYSE Chart of the Day
Courtesy of Nirvana Systems




TER has pulled back precisely to the 50% Fibonacci Retracement zone and looks poised to head lower. This lower high at Fib level indicates we could see another round of selling to new lows.

Daily Trading Signals

 
Daily Market Commentary
Courtesy of Nirvana Systems

Updated Friday, 8/24 for Monday's market.

Key DOW Levels for 8/27

UP

None

DN

Below 13,150


Steady Uptrend...

- Dow trends slowly higher throughout session, closes at highs. The Index trended steadily higher into the Close and eventually ended the day with a big 143 point gain. The Dow is now at a decision point at the key 13,400 level.

- The NASDAQ and S&P each trended steadily higher throughout the day, with the tech-heavy index leading the way. Look for more strength ahead if near-term support remains untouched.

Summary

The Dow closed the day at the session's highs with a nice gain after trending higher the entire day. Look for the index to test the major upper trend line at 13,400 next week. This line will likely dictate direction.

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The Lowdown on Bottoms

Bottoms print as a result of market physics. Uptrends and downtrends exhibit natural wave motion as they thrust forward, and they pull back to test gains or losses. This action-reaction becomes very important at market turning points. It implies that a reversal pattern will appear at some point in each trend. In an uptrend, a lower high will eventually follow a higher high and mark a new top. In a downtrend, lower lows will finally stop when price action prints a higher low. This marks the birth of a bottom.

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Trading Education Tutorial
Courtesy of Nirvana Systems

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.

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NASDAQ Chart of the Day
Courtesy of Nirvana Systems




REGN has formed a clear inverted head-and-shoulders pattern at the lows of the Summer decline. The neck line (resistance) is clearly defined at 19.00 and makes for a very solid fulcrum in the charts. A break above this level will likely lead to key strength, while a failure will lead to another big round of selling. Watch it closely.

Daily Trading Signals

 
NYSE Chart of the Day
Courtesy of Nirvana Systems




NBR has thrown some big reversal tails at the key 27.20 support level, which has held firm since last Fall. If NBR can continue to hold above 27.20, we could see another nice rally toward the Summer highs.

Daily Trading Signals

 
Daily Market Commentary
Courtesy of Nirvana Systems

Updated Thursday, 8/23 for Friday's market.

Key DOW Levels for 8/24

UP

Above 13,500

DN

Below 13,000


Quiet Session...

- Dow opens session with promise, but closes flat for the day. From prior commentary, "...While the Dow has picked up a considerable amount of points along the way, today's upside break through 13,200 does not lend confidence to the bulls...a break back below 13,150 could give us an early sign of weakness..."

The Dow opened the session with a fair bit of strength this morning, but the index quickly reversed course and settled into a very tight range, as seen in the 15 Minute Chart. The index basically traded sideways the entire session and eventually closed flat on the day. The Dow continues to near the highs of the six-day uptrend, but does not look poised to head higher.

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