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About this blog: is our free newsletter for individuals interested in technical trading and chart analysis. It is sent out twice a month via email. This blog contains early-access, preview versions of the articles that later appear in the official newsletter.

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ChartWatchers

Two Continuation Patterns Take Shape in XLI

by Arthur Hill

The Industrials SPDR (XLI) has struggled in 2018 and is pretty much unchanged year-to-date. Despite flat performance this year, a pair of bullish continuation patterns are taking shape. Let's look at the key levels to watch going forward. Long-term, the trend is still up because the PPO(50,200,0) is positive, which means the 50-day EMA is above the 200-day EMA. The ETF also recorded a 52-week high in January. The first continuation pattern is a large falling wedge. This pattern represents a correction after the big advance from October to January (~22%). The falling wedge Read More 

ChartWatchers

Dovish ECB Offsets Hawkish Fed

by John Murphy

Editors Note: This article was originally published in John Murphy's Market Message on Thursday, June 14th at 11:39am EST. The Fed raised its short-term rate by a quarter point yesterday as expected. But it also added a fourth rate hike this year which gave its announcement a more hawkish tilt. That had the immediate effect of boosting Treasury bond yields and weakening bond proxies like utilities and REITS. Bank stocks, however, ended in the red after an early bounce. And stock indexes lost a little ground. A dollar bounce also faded by day's end. Some of those reactions to the Fed are Read More 

ChartWatchers

Shorting Stocks that Miss Earnings Expectations

by John Hopkins

  I have found over many years of trading that it is so much more difficult to make money shorting stocks than going long. With the exception of the Dot.com bubble between 2000-2002 and the bear market of 2008-2009 during the Great Recession we've been in a bull market for a long time and trying to short stocks in a bull market is like pulling teeth. However, just like it makes sense to seek out companies that beat earnings expectations as long candidates, you might want to consider seeking out companies that miss earnings expectations as potential short candidates. Read More 

ChartWatchers

Strong Jobs Report Boosts Stocks, While S&P 500 Nears May High

by John Murphy

Editors Note: This article was originally published in John Murphy's Market Message on Friday, June 1st at 1:19pm EST. A stronger than expected jobs report for May is giving a boost to stocks today. So is the fact that European stocks are rising (as well as Italy's bond and stock markets). In addition, yesterday's stock selling in response to new tariffs was relatively mild which is also encouraging. The bottom line is that stocks are having a strong day today and are starting the month of June in a stronger technical condition. Chart 1 shows the S&P 500 ending the week on a Read More 

ChartWatchers

Why We Emphasize Honoring Stops - A MUST Read

by John Hopkins

At EarningsBeats we issue long/short trade alerts on companies that beat/miss earnings expectations. When we issue a trade alert we include entry price, target price and stop loss. Stop losses are based upon key technical or price support, so they matter. We continuously emphasize the importance of honoring stops if they come into play. Why? Because ignoring a stop can become extremely painful and we have an actual recent example to share with you. We issued a long alert on Frontier Communications (FTR) on May 15 as it beat earnings expectations and pulled back to a level that presented Read More 

ChartWatchers

The Stock Market Will Go Much Higher And Its Strength Will Be Shocking

by Tom Bowley

While many market pundits seemed to grow very concerned about the 10 year treasury yield ($TNX) rising to 7 year highs at its recent 3.11% peak, I only grow nervous when the TNX falls.  Why?  Well, rising rates are typically a precursor to economic strength.  The S&P 500 ($SPX) has a strong positive correlation with the direction of the TNX.  It might go against common sense as many believe that rising rates will slow our economy.  At some point, that could be the case, but not when we're near all-time low levels on the TNX.  Interest rates are at Read More 

ChartWatchers

S&P 500 Gets Third Bullish Breadth Thrust

by Arthur Hill

There were eight breadth thrusts in the month of May and seven of these were bullish (>70%). In particular, there were three bullish breadth thrusts last week. These strong readings show broad participation and give the bulls the edge going forward. Chartists can measure daily breadth by using the AD Percent indicators for the S&P 500, S&P Mid-Cap 400 and S&P Small-Cap 600. AD Percent = (Advances - Declines) / Total Issues. This shows net advances as a percentage of total issues and we can compare these values across indexes. I use +70% to signal a bullish breadth thrust Read More 

ChartWatchers

Online Gaming Is Dealing Winning Hands

by Greg Schnell

Three stocks in the online gaming arena are particularly interesting. With the changing regulations these three stocks are making big moves. You'll have to find your entry but they should be on watch lists. The Stars Group is listed in the USA and Canada.  Boyd Gaming Group Canadian listed Great Canadian Gaming. This area of the market is in full speed ahead mode. Try to figure out a place to get involved.  I host a new TV show on StockCharts.com called The Final Bar. It airs Thursdays at 5 PM ET and is repeated Read More 

ChartWatchers

Bonds (TLT) IT BUY Signal Arrives Too Late to the Party

by Erin Swenlin

Bonds enjoyed quite a rally over the past two weeks which isn't a surprise given Bond Yields took a nose-dive. The daily chart of the $TYX shows how yields crashed. However, they are now bouncing off strong support at 2.95%. They may not be able to avoid the IT Trend Model Neutral signal that is setting up, but like the new IT Trend Model BUY signal on TLT-- it's arriving too late. The PMO is decelerating on this latest bounce and will likely turn up soon. The IT Trend Model BUY signal was triggered when the 20-EMA crossed above the 50-EMA. Note Read More 

ChartWatchers

When the Market is Choppy Search for the Best of the Best

by John Hopkins

The S&P hit its all time high of 2872 on January 26, less than 4 months. ago. Two weeks later, on February 9, it touched 2532, having fallen almost 12% before recovering some. But since then the bulls have struggled to make progress with the S&P pretty much at the same level it was in early February. Though the VIX, which hit 50 on February 6, has since pulled back into the 13's, volatility has kept traders on their collective toes, which has made stock selection when trading more important than ever. Though the S&P remains 5.5% below the February high it's still over 7% above Read More 

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