The morningstar formation, as most readers know, is a three-day bullish reversal pattern. It consists of a large dark down-day candle , foloed by a narrow opening and closing range doji candle, and completed by a large white or up-day candle. It represents a transition in bearishness, to a neutral stance, to bullishness. The formation… Read More »
The S&P 500 index gapped higher last Friday but, as I noted in the previous post, the initial move faded and the close was well into the day’s lower range. That pull back formed a spinning top candle. A spinning top and also the doji candle, is a candlestick whose close is at or near… Read More »
While the action that played out on the charts of the major market averages on Friday may seem at first bullish, there were some underlying technical issues. The Dow Jones Industrial Average was up over 500 points early in Friday’s session and finished out the day 319 points higher. The S&P was up about 2%… Read More »
Thursday on Twitter we pondered the possibility that a bullish morningstar reversal pattern could be forming on the $SPY daily chart. The only piece of the pattern missing was the third and final large bodied up-day candle. That was exactly what we got at the end of Friday’s strong session, with the formation of a… Read More »
These charts reflect stocks in uptrends with clearly defined trend lines that represent good stop-loss reference points:
The medical devices and scientific instrument and research companies are showing strength this month. Several in the space like Danaher (DHR) and EXACT Sciences (EXAS) look like they are ready to break out. One way to take advantage of the broad sector strength is to trade the iShares US Medical Devices ETF (IHI). The daily… Read More »
Bond yields continue to reflect a risk-off environment. It has been that way for a long time but when that docile dynamic starts to reverse, it could accelerate quickly. Traders should be prepared to profit from the machinations of the “bond vigilantes,” and higher yields. Jeffrey Gundlach, of DoubleLine Capital has been warning about corporate… Read More »
All the significant highs that were made on the Russell 2000 (RUT) chart, going back to October 2018 have been signaled by an eveningstar candle pattern. Most readers know what a candlestick pattern is and what it suggests about trader sentiment. The eveningstar is a three day reversal pattern that starts with a large up-day… Read More »
Caterpillar (CAT) is a component of the Dow Jones Industrial Average (DJIA) and, as such, is a good measure of the condition of the traditional industrial sector. It’s machinery is used in mining, agriculture, infrastructure rebuilding, and many other areas of heavy construction. Another aspect of Caterpillar’s importance is as a measure of the world… Read More »
A nearly seven month inverse head and shoulders pattern has formed on the Financial Select Sector SPDR Fund (XLF) weekly chart. This bottoming process began in October last year and was completed by a neckline breakout this month. The left shoulder formed after the XLF made a low in October in the $25 area, and… Read More »