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Thomas Bulkowski’s successful investment activities allowed him to retire at age 36. He is an internationally known author and trader with 30+ years of stock market experience and widely regarded as a leading expert on chart patterns. He may be reached at

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Chart Patterns: After the Buy
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Busted
Patterns
Candles Chart
Patterns
Event
Patterns
Small Patterns
Market
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
As of 04/28/2017
20,941 -40.82 -0.2%
9,098 -96.36 -1.0%
704 -3.23 -0.5%
6,048 -1.33 0.0%
2,384 -4.57 -0.2%
YTD
6.0%
0.6%
6.8%
12.3%
6.5%
Tom's Targets    Overview: 04/17/2017
20,100 or 21,150 by 05/01/2017
8,500 or 9,500 by 05/01/2017
725 or 685 by 05/01/2017
6,150 or 5,900 by 05/15/2017
2,275 or 2,425 by 05/01/2017
Mutt Winners: None YTD

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December 2013 Headlines


Archives


Tuesday 12/31/13. Trading Tuesday: Dow

The index climbed by 0.2% or 25.88 points. Since 10/01/1928 the index made 1224 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.6% on 668 occasions.
     Average loss was -0.6% on 556 occasions.
Expect the index to close higher 54.6% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 63/97 or 64.9% of the time.
     The prediction of the index closing lower has been right 19/31 or 61.3% of the time.

Picture of the Dow industrials on the 5 minute scale.

Since I post this entry the night before, be sure to check how the futures are trading before the market opens. Large plus or minus numbers in the futures often sets the opening direction up or down, respectively.

I show a picture of the Dow industrials on the 5-minute scale from Friday's and Monday's trading.

I am starting to show multiple days on the intraday chart to highlight areas of support and resistance. Maybe we can see how that effects patterns and how noise interferes with them.

This chart shows a triple bottom at ABC. It confirms as a valid chart pattern at D when the index closes above the highest peak between the three bottoms. At E, the index throws back. On the daily charts, research says that the security has a 65% of moving higher. That's what happened here.

The index is now plowing through a pennant/flag pattern at F. The blue line shows where the index is currently in regards to the pennant. Will congestion at F stop the index from rising? We'll find out after Tuesday's trading.

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Dow industrials, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

Top

© 2013 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  15,420.48    
 Monthly S1  15,962.38  541.91   
 Weekly S2  16,115.76  153.37   
 Monthly Pivot  16,245.70  129.94   
 Weekly S1  16,310.02  64.33   
 Weekly Pivot  16,419.52  109.49   
 Daily S2  16,467.69  48.17   
 Low  16,476.87  9.18   
 Open  16,484.51  7.64   
 Daily S1  16,485.99  1.48   Yes! The Daily S1 is close to the Open.
 61.8% Down from Intraday High  16,487.37  1.38   Yes! The 61.8% Down from Intraday High is close to the Daily S1.
 50% Down from Intraday High  16,490.61  3.24   
 38.2% Down from Intraday High  16,493.85  3.24   
 Daily Pivot  16,495.17  1.32   Yes! The Daily Pivot is close to the 38.2% Down from Intraday High.
 Close  16,504.29  9.12   
 High  16,504.35  0.06   Yes! The High is close to the Close.
 Daily R1  16,513.47  9.12   
 Daily R2  16,522.65  9.18   
 Weekly R1  16,613.78  91.13   
 Weekly R2  16,723.28  109.49   
 Monthly R1  16,787.60  64.33   
 Monthly R2  17,070.92  283.31   

Monday 12/30/13. Market Monday: The Week Ahead

My Prediction

Picture of the Dow industrials on the daily scale.

I show a chart of the Dow industrials on the daily scale.

I chose this index because of the chart pattern shown here by the letters ABCD. It's not completed, but it's obvious when I explain what you're looking at.

It's a measured move up chart pattern. The idea behind this pattern is that the AB leg will equal the length (time) and height (price) of the second leg, CD. BC is called the corrective phase.

My research (see the link) tells how often a stock will return to the corrective phase and how often the second leg equals the first.

If this pattern holds true to the ideal, then we have lots of up-move left. Yippee.

Top

A Brief Look Back

Picture of a flower from my garden.

The following are economic reports that moved the markets last week. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Up 73.47 points.
Tuesday: Up 62.94 points.
Thursday: Up 122.33 points.
Friday: Down 1.47 points.
Saturday: Holiday or other weird event!

For the Week...

The Dow industrials were up 257.27 points or 1.6%.
The Nasdaq composite was up 51.85 points or 1.3%.
The S&P 500 index was up 23.08 points or 1.3%.

Year to Date...

Dow Industrials
     0.3% down from the high of 16,529.01 on 12/27/2013.
     25.7% up from the low of 13,104.30 on 01/02/2013.
Nasdaq
     0.4% down from the high of 4,175.37 on 12/27/2013.
     35.1% up from the low of 3,076.60 on 01/08/2013.
S&P 500
     0.2% down from the high of 1,844.89 on 12/27/2013.
     29.1% up from the low of 1,426.19 on 01/02/2013.

Top

Economic Reports

The following information is derived from yahoo!finance and sometimes Bloomberg.com with times local to the east coast.

ReportTimeA-F
Rating
Description
Initial jobless claims8:30 WC+Counts people filing for state unemployment benefits.
Construction spending10:00 WDCovers residential/non-residential/public spending on new construction.
Crude inventories11:00 Th?My guess: Measures oil inventory.
Auto & truck sales2:00 ThC-Monthly sales of domestically produced vehicles.

Options Expiration

No options expire this week.

Top

Swing and Position Traders: Chart Pattern Indicator

As of 12/27/2013, the CPI had:

3 bearish patterns,
41 bullish patterns,
491 patterns waiting for breakout.
The CPI signal is 93.2%, which is bullish (>= 65%).

The chart pattern indicator is bullish with 2 of 3 full triangles showing (). Additional triangles are a measure of strength with solid triangles meaning a more reliable signal than half triangles.

Swing Traders: Pivot Points

The following is based on an SFO article in December 2004 by John Seekinger, titled, "Take a two-dimensional approach." He offers these tips.

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  16,422  16,450  16,490  16,518  16,557 
Weekly  16,107  16,293  16,411  16,597  16,715 
Monthly  15,412  15,945  16,237  16,770  17,062 
S&P 500 (^GSPC): Daily  1,837  1,839  1,842  1,844  1,847 
Weekly  1,814  1,828  1,836  1,850  1,858 
Monthly  1,741  1,791  1,818  1,868  1,895 
Nasdaq (^IXIC): Daily  4,140  4,148  4,162  4,170  4,184 
Weekly  4,106  4,131  4,153  4,179  4,201 
Monthly  3,908  4,032  4,104  4,228  4,300 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

Pivot point: P = (H + L + C)/3
First resistance level: R1 = (2 * P) - L
First support level: S1 = (2 * P) - H)
Second resistance level: R2 = P + (R1 - S1)
Second support level: S2 = P - (R1 - S1)
H = high price , L=low price, C=closing price

Top

Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 2 weeks up 32.1%   The trend may continue. 
 4 months up 19.2%   Expect a reversal soon. 
 S & P 500 (^GSPC) 2 weeks up 31.7%   The trend may continue. 
 4 months up 26.9%   The trend may continue. 
 Nasdaq composite (^IXIC) 2 weeks up 29.4%   The trend may continue. 
 4 months up 20.5%   Expect a reversal soon. 

How long can an index close higher (or lower) each day? The adjacent table shows how often consecutive up or down closes occur in the indices, based on the most recent trend of closes.

Low percentages suggest the market is overdue to turn (think of it as the likelihood that next week or next month will continue the trend, based on historical performance). Values of 50% mean random, so most percentages will be lower.

The analysis uses data going back 10 years for weekly percentages and 25 years for monthly percentages (or the start of data, whichever is more recent). Any unchanged closing price is interpreted as the end of the string of consecutive up or down closes.

Buy-and-Hold: 12-Month SMA

This indicator warns of an index moving into or out of a bear market. It's based on a 12-month simple moving average of monthly closing prices, so it only changes monthly. See 12-Month Moving Average for more details.
Dow Industrials: bullish.
Nasdaq Composite: bullish.
S&P 500 Index: bullish.
Dow Transports: bullish.
Dow Utilities: bearish.

Top

Earnings, Chart Patterns & Industries

Earnings season is over.

Mutual funds will begin dividend distributions and rebalancing their portfolios for the approaching year end (starts in late November).

 Found Chart Pattern Name
22Triangle, symmetrical
14Head-and-shoulders top
9Pipe bottom
7Channel
6Triangle, ascending
6Rectangle top
5Broadening top
5Rising wedge
5Double Top, Eve and Eve
4Rectangle bottom

Large numbers of bullish or bearish chart patterns can signal short- to intermediate-term market trends (many bullish chart patterns can mean an uptrend will continue, for example). However, please realize that the short-term price trend could have changed since the pattern was discovered (this is especially true of pipe tops or bottoms, which are weekly patterns).

The 10 types of most frequently appearing chart patterns in the stocks, indices, and long-only exchange traded funds I follow during the last month are shown in the adjacent table.

 

 

 

 

The industries I follow were the best (rank 1) and worst performing.

This WeekLast Week
1. Human Resources1. Shoe
2. Shoe2. Human Resources
3. Internet3. Internet
4. Air Transport4. Air Transport
5. Biotechnology5. Biotechnology
50. Medical Supplies50. Cement and Aggregates
51. Electric Utility (East)51. Homebuilding
52. Electric Utility (West)52. Medical Supplies
53. Toiletries/Cosmetics53. Toiletries/Cosmetics
54. Short ETFs54. Short ETFs

-- Thomas Bulkowski

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Thursday 12/26/13. Trading Thursday: Nasdaq

The index climbed by 0.2% or 6.52 points. Since 02/05/1971 the index made 598 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.8% on 351 occasions.
     Average loss was -0.8% on 247 occasions.
Expect the index to close higher 58.7% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 53/87 or 60.9% of the time.
     The prediction of the index closing lower has been right 23/44 or 52.3% of the time.

Picture of the Nasdaq composite on the 5 minute scale.

Since I post this entry the night before, be sure to check how the futures are trading before the market opens. Large plus or minus numbers in the futures often sets the opening direction up or down, respectively.

I show a picture of the Nasdaq composite on the 5-minute scale from the last 5 trading days.

Nothing much happened today (Tuesday), so let's look at a longer chart, which I show.

I drew a red trendline underneath price valleys as the index climbed up the chart. Notice how the index moved below the line today. Does that mean the uptrend is over or is it an artifact of a shortened trading day.

I can only speculate. If you look back at last Thursday's trading, which I highlight with a blue line at A, the index moved horizontally and then resumed its upward move. That could happen again. I like that the chart's historical record shows what may happen next. But we have closed below the red trendline. That could mean a tough session on Thursday. Trade cautiously.

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Nasdaq composite, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

Top

© 2013 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  3,859.33    
 Weekly S2  3,949.97  90.64   
 Monthly S1  4,007.38  57.40   
 Weekly S1  4,052.70  45.32   
 Monthly Pivot  4,059.65  6.96   
 Weekly Pivot  4,082.31  22.66   
 Daily S2  4,144.26  61.95   
 Low  4,147.15  2.89   
 Daily S1  4,149.84  2.69   
 61.8% Down from Intraday High  4,150.39  0.55   Yes! The 61.8% Down from Intraday High is close to the Daily S1.
 Open  4,150.64  0.25   Yes! The Open is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  4,151.38  0.74   Yes! The 50% Down from Intraday High is close to the Open.
 38.2% Down from Intraday High  4,152.38  1.00   
 Daily Pivot  4,152.73  0.35   Yes! The Daily Pivot is close to the 38.2% Down from Intraday High.
 Close  4,155.42  2.69   
 High  4,155.62  0.20   Yes! The High is close to the Close.
 Daily R1  4,158.31  2.69   
 Daily R2  4,161.20  2.89   
 Weekly R1  4,185.04  23.84   
 Monthly R1  4,207.70  22.66   
 Weekly R2  4,214.65  6.96   
 Monthly R2  4,259.97  45.32   

Tuesday 12/24/13. Trading Tuesday: Dow

The index climbed by 0.5% or 73.47 points. Since 10/01/1928 the index made 873 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.7% on 477 occasions.
     Average loss was -0.7% on 396 occasions.
Expect the index to close higher 54.6% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 62/96 or 64.6% of the time.
     The prediction of the index closing lower has been right 19/31 or 61.3% of the time.

Picture of the Dow industrials on the 5 minute scale.

Since I post this entry the night before, be sure to check how the futures are trading before the market opens. Large plus or minus numbers in the futures often sets the opening direction up or down, respectively.

I show a picture of the Dow industrials on the 5-minute scale from Monday's trading.

The index moved higher, slowly, forming narrowing waves that turned into a rising wedge chart pattern (red lines). This one broke out upward at A but the index didn't move far before collapsing and breaking out downward.

Downward breakouts have a target of the start of the pattern. I show that as a blue line. The index almost hit the target at B. I don't have stats on rising wedges that state how often these patterns bust in this manner (upward breakout followed by a collapse). It might not apply to day trades anyway.

I don't see anything on the chart that would indicate how trading on Tuesday will fare. The two bottoms (B and the one at the start of the blue line are support areas, so I can see the index coasting up to the high at A. But anything can happen overnight. It's a day before a holiday so expect subdued trading.

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Dow industrials, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

Top

© 2013 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  15,511.36    
 Weekly S2  15,585.78  74.41   
 Monthly S1  15,902.99  317.21   
 Weekly S1  15,940.19  37.21   
 Monthly Pivot  16,095.41  155.22   
 Weekly Pivot  16,114.02  18.60   
 Daily S2  16,186.46  72.45   
 Low  16,225.25  38.79   
 Open  16,225.25  0.00   Yes! The Open is close to the Low.
 Daily S1  16,240.54  15.29   
 61.8% Down from Intraday High  16,260.72  20.19   
 50% Down from Intraday High  16,271.68  10.96   
 Daily Pivot  16,279.32  7.64   Yes! The Daily Pivot is close to the 50% Down from Intraday High.
 38.2% Down from Intraday High  16,282.64  3.31   Yes! The 38.2% Down from Intraday High is close to the Daily Pivot.
 Close  16,294.61  11.97   
 High  16,318.11  23.50   
 Daily R1  16,333.40  15.29   
 Daily R2  16,372.18  38.79   
 Weekly R1  16,468.43  96.25   
 Monthly R1  16,487.04  18.60   
 Weekly R2  16,642.26  155.22   
 Monthly R2  16,679.46  37.21   

Monday 12/23/13. Market Monday: The Week Ahead

My Prediction

Picture of the s and p 500 index on the daily scale.

I show the S&P 500 index on the daily scale.

A busted head-and-shoulders top appears at LS (left shoulder), H (head), and RS (right shoulder). The red neckline confirms the chart pattern as a valid one when the index closes below it.

In this example the head-and-shoulders busted when the index closed above the top of the chart pattern. That suggests a strong upward move is about to unfold. That's not a lock (sure thing), but that's what the chart is telling me. Hold on for the ride.

 

 

Top

A Brief Look Back

Picture of a flower from my garden.

The following are economic reports that moved the markets last week. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Up 129.21 points.
Tuesday: Down 9.31 points.
Wednesday: Up 292.71 points.
Thursday: Up 11.11 points.
Friday: Up 42.06 points.

For the Week...

The Dow industrials were up 465.78 points or 3.0%.
The Nasdaq composite was up 103.76 points or 2.6%.
The S&P 500 index was up 43 points or 2.4%.

Year to Date...

Dow Industrials
     0.4% down from the high of 16,287.84 on 12/20/2013.
     23.8% up from the low of 13,104.30 on 01/02/2013.
Nasdaq
     0.2% down from the high of 4,111.93 on 12/20/2013.
     33.4% up from the low of 3,076.60 on 01/08/2013.
S&P 500
     0.3% down from the high of 1,823.75 on 12/20/2013.
     27.5% up from the low of 1,426.19 on 01/02/2013.

Top

Economic Reports

The following information is derived from yahoo!finance and sometimes Bloomberg.com with times local to the east coast.

ReportTimeA-F
Rating
Description
Personal income & consumption8:30 MC+Measures sources of income to predict future demand.
Personal consumption expenditures8:30 MC+Covers durables, non-durables, and services.
Michigan sentiment9:55 MB-Consumer sentiment: Measures strength of consumer spending.
Durable goods orders8:30 TBMeasures orders, shipments of goods with lifespans >3 years.
New home sales10:00 TC+Shows sales of single-family homes.
Initial jobless claims8:30 ThC+Counts people filing for state unemployment benefits.
Crude inventories11:00 F?My guess: Measures oil inventory.

Options Expiration

No options expire this week.

Top

Swing and Position Traders: Chart Pattern Indicator

As of 12/20/2013, the CPI had:

3 bearish patterns,
57 bullish patterns,
239 patterns waiting for breakout.
The CPI signal is 95.0%, which is bullish (>= 65%).

The chart pattern indicator is bullish with 2 of 3 full triangles showing (). Additional triangles are a measure of strength with solid triangles meaning a more reliable signal than half triangles.

Swing Traders: Pivot Points

The following is based on an SFO article in December 2004 by John Seekinger, titled, "Take a two-dimensional approach." He offers these tips.

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  16,120  16,170  16,229  16,280  16,339 
Weekly  15,561  15,891  16,090  16,419  16,618 
Monthly  15,487  15,854  16,071  16,438  16,655 
S&P 500 (^GSPC): Daily  1,804  1,811  1,817  1,825  1,831 
Weekly  1,748  1,783  1,803  1,839  1,859 
Monthly  1,748  1,783  1,803  1,839  1,859 
Nasdaq (^IXIC): Daily  4,047  4,076  4,094  4,123  4,141 
Weekly  3,933  4,019  4,065  4,151  4,198 
Monthly  3,842  3,974  4,043  4,174  4,243 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

Pivot point: P = (H + L + C)/3
First resistance level: R1 = (2 * P) - L
First support level: S1 = (2 * P) - H)
Second resistance level: R2 = P + (R1 - S1)
Second support level: S2 = P - (R1 - S1)
H = high price , L=low price, C=closing price

Top

Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 1 week up 44.7%   Expect a random direction. 
 4 months up 19.2%   Expect a reversal soon. 
 S & P 500 (^GSPC) 1 week up 44.3%   Expect a random direction. 
 4 months up 26.9%   The trend may continue. 
 Nasdaq composite (^IXIC) 1 week up 43.5%   Expect a random direction. 
 4 months up 20.5%   Expect a reversal soon. 

How long can an index close higher (or lower) each day? The adjacent table shows how often consecutive up or down closes occur in the indices, based on the most recent trend of closes.

Low percentages suggest the market is overdue to turn (think of it as the likelihood that next week or next month will continue the trend, based on historical performance). Values of 50% mean random, so most percentages will be lower.

The analysis uses data going back 10 years for weekly percentages and 25 years for monthly percentages (or the start of data, whichever is more recent). Any unchanged closing price is interpreted as the end of the string of consecutive up or down closes.

Buy-and-Hold: 12-Month SMA

This indicator warns of an index moving into or out of a bear market. It's based on a 12-month simple moving average of monthly closing prices, so it only changes monthly. See 12-Month Moving Average for more details.
Dow Industrials: bullish.
Nasdaq Composite: bullish.
S&P 500 Index: bullish.
Dow Transports: bullish.
Dow Utilities: bearish.

Top

Earnings, Chart Patterns & Industries

Earnings season is over.

Mutual funds will begin dividend distributions and rebalancing their portfolios for the approaching year end (starts in late November).

 Found Chart Pattern Name
23Triangle, symmetrical
14Head-and-shoulders top
7Channel
7Triangle, ascending
6Rising wedge
5Double Top, Eve and Eve
4Rectangle bottom
4Double Top, Adam and Adam
4Diamond top
4Double Top, Eve and Adam

Large numbers of bullish or bearish chart patterns can signal short- to intermediate-term market trends (many bullish chart patterns can mean an uptrend will continue, for example). However, please realize that the short-term price trend could have changed since the pattern was discovered (this is especially true of pipe tops or bottoms, which are weekly patterns).

The 10 types of most frequently appearing chart patterns in the stocks, indices, and long-only exchange traded funds I follow during the last month are shown in the adjacent table.

 

 

 

 

The industries I follow were the best (rank 1) and worst performing.

This WeekLast Week
1. Shoe1. Shoe
2. Human Resources2. Internet
3. Internet3. Air Transport
4. Air Transport4. Human Resources
5. Biotechnology5. Computer Software and Svcs
50. Cement and Aggregates50. Electric Utility (West)
51. Homebuilding51. Medical Supplies
52. Medical Supplies52. Toiletries/Cosmetics
53. Toiletries/Cosmetics53. Homebuilding
54. Short ETFs54. Short ETFs

-- Thomas Bulkowski

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Wednesday 12/18/13. What's Hot Wednesday

The following are taken from my database of about 560 stocks and 100 exchange traded funds (ETFs), not from the entire stock market.

Stocks and ETFs with the least amount of noise (low noise means it trends up, down, or both rather than moving sideways) make for better swing trading candidates. ETFs, on average, have lower noise levels than stocks, but that could be due to lots of gaps (which I consider bad). Click here for more information on noise.

Biggest winners and losers over the past week, from the close on 07/29/2014 to 08/05/2014 and year to date. These lists are useful for momentum players, those that buy stocks moving up or trending lower. Also, look for several stocks from the same industry. Finding some may give a clue to an industry on the move, one either trending up or suffering. The lists also include country ETFs. If those are performing well, consider diversifying into them.

Below are the top 10 stocks with the least amount of noise during the past month.

Average
Noise
Last
Close
YTDStockIndustryMost Recent Chart Pattern
9.1%$1.11-79.56%Cache (CACH)ApparelDead-cat bounce from 05/08/2014 to 05/08/2014
13.6%$104.620.15%Kimberly-Clark Corp (KMB)Household ProductsDouble Top, Adam and Adam from 06/20/2014 to 07/16/2014
18.2%$115.00-1.33%Monsanto Co (MON)Chemical (Diversified)Double Top, Adam and Adam from 06/25/2014 to 07/02/2014
18.2%$3.78-42.90%Hovnanian Enterprises Inc (HOV)HomebuildingBroadening top, right-angled and ascending from 04/22/2014 to 06/04/2014
18.2%$565.070.84%Google (GOOG)InternetDouble Bottom, Adam and Adam from 06/04/2014 to 06/17/2014
18.2%$23.15-9.39%CRH plc (CRH)Cement and AggregatesFalling wedge from 06/25/2014 to 07/24/2014
22.7%$69.1018.57%Williams-Sonoma Inc. (WSM)Retail (Special Lines)Double Top, Adam and Eve from 03/21/2014 to 04/01/2014
22.7%$22.43-11.27%Semtech Corp (SMTC)Semiconductor Cap Equip.Triangle, descending from 09/04/2013 to 10/31/2013
22.7%$9.09-23.16%QLogic Corp (QLGC)SemiconductorHead-and-shoulders top from 03/26/2014 to 04/09/2014
22.7%$2.03-25.91%Mattson Technology Inc. (MTSN)Semiconductor Cap Equip.Pipe bottom from 12/09/2013 to 12/16/2013

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Below are the top 10 stocks with the least amount of noise during the past 3 months.

Average
Noise
Last
Close
YTDStockIndustryMost Recent Chart Pattern
18.8%$23.15-9.39%CRH plc (CRH)Cement and AggregatesFalling wedge from 06/25/2014 to 07/24/2014
23.4%$565.070.84%Google (GOOG)InternetDouble Bottom, Adam and Adam from 06/04/2014 to 06/17/2014
26.6%$21.94-6.99%Assured Guaranty Ltd. (AGO)Insurance (Life)Pipe top from 06/16/2014 to 06/23/2014
28.1%$124.960.04%Chevron Corp (CVX)Petroleum (Integrated)Vertical move up from 04/05/2013 to 04/11/2013
31.3%$91.570.96%Raytheon Co. (RTN)Aerospace/DefenseBroadening top, right-angled and descending from 03/05/2014 to 04/24/2014
31.3%$35.655.16%OGE Energy Corp (OGE)Electric Utility (Central)Triangle, symmetrical from 02/26/2014 to 03/27/2014
31.3%$31.93-3.18%FirstEnergy Corp. (FE)Electric Utility (East)Head-and-shoulders top from 04/16/2014 to 05/09/2014
31.3%$30.50-9.50%ConAgra Foods Inc (CAG)Food ProcessingDouble Top, Adam and Eve from 04/04/2014 to 04/22/2014
31.3%$25.65-17.07%Brady Corp (BRC)Chemical (Diversified)Broadening top, right-angled and ascending from 03/13/2014 to 04/07/2014
32.8%$49.677.42%New Jersey Resources Corp (NJR)Natural Gas (Distributor)Big M from 07/19/2013 to 08/08/2013

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Below are the top 10 stocks with the least amount of noise during the past 6 months.

Average
Noise
Last
Close
YTDStockIndustryMost Recent Chart Pattern
25.6%$23.15-9.39%CRH plc (CRH)Cement and AggregatesFalling wedge from 06/25/2014 to 07/24/2014
29.6%$565.070.84%Google (GOOG)InternetDouble Bottom, Adam and Adam from 06/04/2014 to 06/17/2014
32.0%$30.50-9.50%ConAgra Foods Inc (CAG)Food ProcessingDouble Top, Adam and Eve from 04/04/2014 to 04/22/2014
34.4%$62.84-10.46%Emerson Electric (EMR)Computers and PeripheralsTriangle, symmetrical from 06/20/2014 to 07/24/2014
34.4%$25.65-17.07%Brady Corp (BRC)Chemical (Diversified)Broadening top, right-angled and ascending from 03/13/2014 to 04/07/2014
35.2%$2.08-70.33%Prana Biotechnology Limited (PRAN)BiotechnologyDead-cat bounce from 04/01/2014 to 04/01/2014
36.8%$35.70-11.72%Yahoo! Inc. (YHOO)InternetRectangle bottom from 04/16/2014 to 07/31/2014
36.8%$105.02-7.72%United Technologies Corp (UTX)Diversified Co.Broadening top, right-angled and ascending from 12/30/2013 to 01/16/2014
36.8%$14.4580.40%Pioneer Energy Services (PES)Oilfield Svcs/EquipmentTriangle, ascending from 04/30/2014 to 05/14/2014
36.8%$124.960.04%Chevron Corp (CVX)Petroleum (Integrated)Vertical move up from 04/05/2013 to 04/11/2013

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Below are the top 10 ETFs with the least amount of noise during the past month.

Average
Noise
Last
Close
YTDStockIndustryMost Recent Chart Pattern
9.1%$45.83-3.41%S and P Europe 350 Index fund (IEV)Investment Co. (Foreign)Double Top, Adam and Eve from 12/31/2013 to 01/21/2014
13.3%$54.79-0.94%Market Vectors Money-Center (RKH)Long ETFsRising wedge from 09/19/2013 to 12/04/2013
13.6%$32.49-1.52%MSCI Switzerland Index (EWL)Investment Co. (Foreign)Roof from 02/14/2014 to 03/20/2014
13.6%$33.72-5.89%MSCI Sweden Index (EWD)Investment Co. (Foreign)Double Top, Adam and Eve from 12/31/2013 to 01/22/2014
18.2%$39.372.07%MSCI Spain Index (EWP)Investment Co. (Foreign)Double Top, Adam and Adam from 06/09/2014 to 06/19/2014
18.2%$28.30-10.89%MSCI Germany Index (EWG)Investment Co. (Foreign)Double Top, Adam and Adam from 06/06/2014 to 06/19/2014
18.2%$26.94-5.31%MSCI France Index (EWQ)Investment Co. (Foreign)Broadening top from 11/06/2013 to 12/31/2013
18.2%$16.520.79%MSCI Belgium Investable Mkt Idx (EWK)Investment Co. (Foreign)Double Top, Adam and Eve from 12/31/2013 to 01/23/2014
18.2%$129.189.38%DJ US Pharmaceuticals index fund (IHE)DrugHead-and-shoulders bottom from 06/06/2013 to 07/03/2013
22.7%$16.21-6.95%UltraShort 2x Financials ProShares (SKF)Short ETFsPipe top from 04/07/2014 to 04/14/2014

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Below are the top 10 ETFs with the least amount of noise during the past 3 months.

Average
Noise
Last
Close
YTDStockIndustryMost Recent Chart Pattern
10.2%$54.79-0.94%Market Vectors Money-Center (RKH)Long ETFsRising wedge from 09/19/2013 to 12/04/2013
21.9%$15.740.96%MSCI Italy Index (EWI)Investment Co. (Foreign)Rising wedge from 01/15/2014 to 03/13/2014
25.0%$19.051.82%iShares Silver Trust (SLV)Metals and Mining (Div.)Pipe top from 10/21/2013 to 10/28/2013
25.0%$96.200.50%DJ US consumer goods (household goods) (IYK)Household ProductsDouble Top, Eve and Eve from 06/20/2014 to 07/14/2014
26.6%$16.21-6.95%UltraShort 2x Financials ProShares (SKF)Short ETFsPipe top from 04/07/2014 to 04/14/2014
26.6%$45.83-3.41%S and P Europe 350 Index fund (IEV)Investment Co. (Foreign)Double Top, Adam and Eve from 12/31/2013 to 01/21/2014
26.6%$26.94-5.31%MSCI France Index (EWQ)Investment Co. (Foreign)Broadening top from 11/06/2013 to 12/31/2013
28.1%$33.72-5.89%MSCI Sweden Index (EWD)Investment Co. (Foreign)Double Top, Adam and Eve from 12/31/2013 to 01/22/2014
28.1%$11.82-2.63%MSCI Japan Index fund (EWJ)Investment Co. (Foreign)Broadening top, right-angled and ascending from 04/17/2014 to 05/20/2014
29.7%$22.171.42%SPDR Financial Select Sector (XLF)Investment Co. (Domestic)Broadening top, right-angled and ascending from 06/09/2014 to 07/10/2014

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Below are the top 10 ETFs with the least amount of noise during the past 6 months.

Average
Noise
Last
Close
YTDStockIndustryMost Recent Chart Pattern
19.6%$54.79-0.94%Market Vectors Money-Center (RKH)Long ETFsRising wedge from 09/19/2013 to 12/04/2013
27.2%$65.611.45%MSCI South Korea Index (EWY)Investment Co. (Foreign)Triple top from 05/09/2013 to 06/03/2013
27.2%$15.740.96%MSCI Italy Index (EWI)Investment Co. (Foreign)Rising wedge from 01/15/2014 to 03/13/2014
28.0%$56.0017.50%MSCI Turkey Index (TUR)Long ETFsTriangle, symmetrical from 02/03/2014 to 03/13/2014
28.2%$13.46-33.53%UltraShort 2x Semiconductor ProShares (SSG)Short ETFsPipe bottom from 01/13/2014 to 01/21/2014
28.8%$16.520.79%MSCI Belgium Investable Mkt Idx (EWK)Investment Co. (Foreign)Double Top, Adam and Eve from 12/31/2013 to 01/23/2014
29.6%$45.83-3.41%S and P Europe 350 Index fund (IEV)Investment Co. (Foreign)Double Top, Adam and Eve from 12/31/2013 to 01/21/2014
30.4%$11.82-2.63%MSCI Japan Index fund (EWJ)Investment Co. (Foreign)Broadening top, right-angled and ascending from 04/17/2014 to 05/20/2014
30.4%$28.30-10.89%MSCI Germany Index (EWG)Investment Co. (Foreign)Double Top, Adam and Adam from 06/06/2014 to 06/19/2014
31.2%$26.247.67%MSCI Australia Index fund (EWA)Investment Co. (Foreign)Rectangle top from 04/09/2014 to 07/17/2014

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Below are the top 10 stocks with the best performance during the past week out of 502 stocks. Stocks from this list may suggest what stocks or industries will do well in the future.

Week
Change
Last
Close
YTDStockIndustryMost Recent Chart Pattern
20.94%$33.96-14.60%Trex Company (TREX)Building MaterialsPipe top from 04/21/2014 to 04/28/2014
14.40%$54.3418.18%Open Text Corp (OTEX)E-CommerceRectangle bottom from 05/08/2014 to 07/30/2014
10.51%$20.5095.98%Century Aluminum Co. (CENX)Metals and Mining (Div.)Triangle, symmetrical from 11/05/2013 to 12/09/2013
9.63%$26.97-21.16%RTI International Metals Inc. (RTI)Metals and Mining (Div.)Pipe bottom from 05/12/2014 to 05/19/2014
9.54%$54.29-5.76%Armstrong World Industries (AWI)Building MaterialsTriple bottom from 03/27/2014 to 05/07/2014
8.99%$11.4050.99%Build-A-Bear Workshop Inc (BBW)Retail (Special Lines)Pipe top from 06/02/2014 to 06/09/2014
8.53%$32.31-34.91%SodaStream International Ltd (SODA)Food ProcessingFalling wedge from 04/23/2014 to 05/21/2014
7.65%$4.085.43%Advanced Micro Devices, Inc (AMD)SemiconductorPipe top from 06/09/2014 to 06/16/2014
7.62%$79.84-2.76%Bunge Ltd (BG)Food ProcessingFalling wedge from 05/22/2014 to 06/17/2014
7.14%$21.02-13.82%Surmodics, Inc (SRDX)Medical SuppliesPipe top from 06/30/2014 to 07/07/2014

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Below are the 10 worst performing stocks during the past week out of 502 stocks. Stocks from this list suggest companies or industries that may be having difficulty and might be future short sale candidates.

Week
Change
Last
Close
YTDStockIndustryMost Recent Chart Pattern
-21.10%$27.75-20.53%On Assignment, Inc. (ASGN)Human ResourcesDead-cat bounce from 07/31/2014 to 07/31/2014
-20.17%$12.98-16.42%Genworth Financial Inc (GNW)Insurance (Life)Triangle, symmetrical from 05/13/2014 to 06/23/2014
-19.56%$32.90-2.32%ArcBest Corp (ARCB)Trucking/Transp. LeasingDead-cat bounce from 07/31/2014 to 07/31/2014
-17.80%$26.55-29.14%Noble Corporation (NE)Oilfield Svcs/EquipmentTriangle, symmetrical from 03/14/2014 to 05/14/2014
-16.35%$7.11-49.11%hhgregg, Inc (HGG)Retail (Special Lines)Head-and-shoulders top from 08/26/2013 to 10/24/2013
-15.69%$5.59-21.60%Monster Worldwide (MWW)AdvertisingPennant from 06/10/2014 to 06/19/2014
-14.45%$14.4580.40%Pioneer Energy Services (PES)Oilfield Svcs/EquipmentTriangle, ascending from 04/30/2014 to 05/14/2014
-14.31%$41.027.49%Anika Therapeutics Inc (ANIK)BiotechnologyPipe top from 01/13/2014 to 01/21/2014
-12.92%$29.7822.35%Arris Group Inc. (ARRS)Telecom. EquipmentPipe bottom from 07/07/2014 to 07/14/2014
-12.60%$1.11-79.56%Cache (CACH)ApparelDead-cat bounce from 05/08/2014 to 05/08/2014

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Below are the top 10 stocks with the best performance year to date out of 502 stocks. Knowing which securities are trending higher makes selecting stocks for momentum trades much easier, especially if some share the same industry.

YTD
Change
Last
Close
StockIndustryMost Recent Chart Pattern
117.44%$11.22RF Micro Devices Inc. (RFMD)SemiconductorDouble Bottom, Adam and Adam from 01/10/2014 to 01/24/2014
95.98%$20.50Century Aluminum Co. (CENX)Metals and Mining (Div.)Triangle, symmetrical from 11/05/2013 to 12/09/2013
80.40%$14.45Pioneer Energy Services (PES)Oilfield Svcs/EquipmentTriangle, ascending from 04/30/2014 to 05/14/2014
76.31%$36.99Myriad Genetics Inc (MYGN)BiotechnologyDouble Top, Adam and Adam from 04/04/2014 to 05/01/2014
62.60%$53.87Skechers USA Inc (SKX)ShoeRising wedge from 04/23/2014 to 05/22/2014
61.55%$39.79Newfield Exploration Company (NFX)Natural Gas (Diversified)Pipe bottom from 07/07/2014 to 07/14/2014
56.92%$26.66Nabors Industries, Ltd. (NBR)Oilfield Svcs/EquipmentDouble Top, Eve and Adam from 07/03/2014 to 07/24/2014
56.73%$8.15MannKind Corp (MNKD)BiotechnologyTriangle, symmetrical from 04/10/2014 to 05/07/2014
54.66%$16.44Alcoa (AA)Metals and Mining (Div.)Pipe top from 01/21/2014 to 01/27/2014
50.99%$11.40Build-A-Bear Workshop Inc (BBW)Retail (Special Lines)Pipe top from 06/02/2014 to 06/09/2014

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Below are the 10 worst performing stocks year to date out of 502 stocks. These stocks might represent a good momentum trade from the short side. If some stocks also share the same industry, then the industry may be weak, so concentrate your search there.

YTD
Change
Last
Close
StockIndustryMost Recent Chart Pattern
-79.56%$1.11Cache (CACH)ApparelDead-cat bounce from 05/08/2014 to 05/08/2014
-70.33%$2.08Prana Biotechnology Limited (PRAN)BiotechnologyDead-cat bounce from 04/01/2014 to 04/01/2014
-58.64%$0.76Anadigics Inc (ANAD)SemiconductorHead-and-shoulders bottom from 11/20/2013 to 01/13/2014
-58.10%$57.92Nu Skin Enterprises, Inc (NUS)Household ProductsRectangle bottom from 05/15/2014 to 07/07/2014
-51.41%$17.97Acxiom Corp (ACXM)Computer Software and SvcsDead-cat bounce from 05/15/2014 to 05/15/2014
-49.45%$4.59Vivus Inc (VVUS)BiotechnologyPipe bottom from 11/04/2013 to 11/11/2013
-49.11%$7.11hhgregg, Inc (HGG)Retail (Special Lines)Head-and-shoulders top from 08/26/2013 to 10/24/2013
-49.09%$3.32Hercules Offshore, Inc. (HERO)Petroleum (Producing)Triangle, symmetrical from 04/24/2014 to 06/05/2014
-48.48%$40.54Conns Inc (CONN)Retail (Special Lines)Pipe bottom from 06/09/2014 to 06/16/2014
-46.23%$5.85Blyth Inc (BTH)Household ProductsHead-and-shoulders bottom from 01/14/2014 to 02/24/2014

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Below are the top 10 exchange traded funds (ETF) with the best performance this past week out of 95 ETFs. A hot ETF may suggest an industry or commodity that is doing well, so look there for individual stock picks or just trade the ETF for a momentum play.

Week
Change
Last
Close
YTDFundMost Recent Chart Pattern
8.76%$40.58-17.54%UltraShort 2x Oil and Gas ProShares (DUG)Triple bottom from 02/24/2014 to 03/11/2014
5.83%$26.67-2.74%DJIA short 2x ProShares (DXD)Pipe top from 04/07/2014 to 04/14/2014
5.78%$16.94-21.72%UltraShort 2x Technology ProShares (REW)Horn bottom from 03/17/2014 to 03/31/2014
5.12%$16.21-6.95%UltraShort 2x Financials ProShares (SKF)Pipe top from 04/07/2014 to 04/14/2014
5.02%$26.34-11.19%S and P short 2x ProShares (SDS)Pipe top from 04/07/2014 to 04/14/2014
4.67%$13.46-33.53%UltraShort 2x Semiconductor ProShares (SSG)Pipe bottom from 01/13/2014 to 01/21/2014
4.46%$29.29-14.43%UltraShort 2x Basic Materials ProShares (SMN)Double Top, Adam and Adam from 03/13/2014 to 03/27/2014
4.15%$48.96-18.35%Nasdaq 100 short 2x ProShares (QID)Falling wedge from 04/10/2014 to 05/19/2014
3.76%$15.72-27.19%UltraShort 2x Real Estate ProShares (SRS)Double Top, Adam and Adam from 08/19/2013 to 09/03/2013
2.92%$25.76-1.34%DJIA short 1x ProShares (DOG)Broadening top, right-angled and descending from 07/03/2013 to 10/09/2013

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Below are the 10 worst performing ETFs over the past week out of 95 ETFs. These funds may represent companies or industries that are suffering. Avoid going long in those stocks or buying any stocks from those industries.

Week
Change
Last
Close
YTDFundMost Recent Chart Pattern
-6.37%$15.740.96%MSCI Italy Index (EWI)Rising wedge from 01/15/2014 to 03/13/2014
-5.95%$39.372.07%MSCI Spain Index (EWP)Double Top, Adam and Adam from 06/09/2014 to 06/19/2014
-5.88%$56.0017.50%MSCI Turkey Index (TUR)Triangle, symmetrical from 02/03/2014 to 03/13/2014
-5.74%$113.90-1.05%DJIA, long 2x Ultra Dow 30 ProShares (DDM)Pipe bottom from 04/07/2014 to 04/14/2014
-5.57%$28.30-10.89%MSCI Germany Index (EWG)Double Top, Adam and Adam from 06/06/2014 to 06/19/2014
-5.45%$27.225.34%PowerShares Dynamic Oil Services (PXJ)Head-and-shoulders top from 06/23/2014 to 07/17/2014
-5.16%$17.29-12.72%MSCI Austria Investable Mkt Index (EWO)Head-and-shoulders bottom from 03/03/2014 to 03/24/2014
-5.04%$111.148.37%S and P long 2x Ultra SP 500 ProShares (SSO)Pipe bottom from 04/07/2014 to 04/14/2014
-4.79%$71.3810.14%DJ US Oil Equip and services (IEZ)Double Top, Adam and Adam from 07/17/2014 to 07/24/2014
-4.55%$40.697.16%SPDR Utilities Select Sector (XLU)Double Top, Adam and Adam from 06/19/2014 to 06/30/2014

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Below are the top 10 exchange traded funds (ETF) with the best performance year to date out of 95 ETFs. Concentrate your individual stock picks from industries that are doing well, or trade the ETF for a momentum play.

YTD
Change
Last
Close
FundMost Recent Chart Pattern
17.54%$43.55PowerShares Dynamic Biotech and Genome (PBE)Triangle, symmetrical from 04/15/2014 to 05/08/2014
17.50%$56.00MSCI Turkey Index (TUR)Triangle, symmetrical from 02/03/2014 to 03/13/2014
16.82%$87.29iShares Cohen and Steers Realty Majors (ICF)Triangle, descending from 12/04/2013 to 01/02/2014
16.75%$80.15MSCI Thailand Invest Mkt Index (THD)Double Top, Eve and Eve from 04/17/2014 to 05/02/2014
15.49%$115.03Nasdaq 100 long 2x Ultra QQQ ProShares (QLD)Pipe bottom from 04/07/2014 to 04/14/2014
13.91%$48.33Market Vectors Semiconductor (SMH)Triple top from 07/03/2014 to 07/22/2014
13.31%$82.39iShares PHLX SOX Semiconductor Sector (SOXX)Triple top from 07/03/2014 to 07/22/2014
13.20%$60.12Market Vectors Pharmaceutical (PPH)Triangle, symmetrical from 07/03/2014 to 07/30/2014
11.91%$104.36iShares DJ US Healthcare Provider (IHF)Double Top, Adam and Adam from 03/21/2014 to 04/02/2014
11.30%$53.50Market Vectors Oil Services (OIH)Double Top, Eve and Adam from 07/01/2014 to 07/23/2014

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Below are the 10 worst performing ETFs year to date out of 95 ETFs. These represent the stocks or industries you will want to avoid buying or want to concentrate selling short.

YTD
Change
Last
Close
FundMost Recent Chart Pattern
-33.53%$13.46UltraShort 2x Semiconductor ProShares (SSG)Pipe bottom from 01/13/2014 to 01/21/2014
-27.19%$15.72UltraShort 2x Real Estate ProShares (SRS)Double Top, Adam and Adam from 08/19/2013 to 09/03/2013
-21.72%$16.94UltraShort 2x Technology ProShares (REW)Horn bottom from 03/17/2014 to 03/31/2014
-18.35%$48.96Nasdaq 100 short 2x ProShares (QID)Falling wedge from 04/10/2014 to 05/19/2014
-17.54%$40.58UltraShort 2x Oil and Gas ProShares (DUG)Triple bottom from 02/24/2014 to 03/11/2014
-14.43%$29.29UltraShort 2x Basic Materials ProShares (SMN)Double Top, Adam and Adam from 03/13/2014 to 03/27/2014
-12.72%$17.29MSCI Austria Investable Mkt Index (EWO)Head-and-shoulders bottom from 03/03/2014 to 03/24/2014
-11.19%$26.34S and P short 2x ProShares (SDS)Pipe top from 04/07/2014 to 04/14/2014
-10.89%$28.30MSCI Germany Index (EWG)Double Top, Adam and Adam from 06/06/2014 to 06/19/2014
-10.48%$22.22DJ US Home construction index fund (ITB)Flag from 05/28/2014 to 06/04/2014

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Below is a list of market index performance over the past week.

Week
Change
Last
Close
YTDIndexMost Recent Chart Pattern
-1.92%8,059.538.90%DJ 20 Transportation (^DJT)Diamond top from 06/02/2014 to 06/27/2014
-2.02%4,352.844.22%Nasdaq Composite (^IXIC)Triangle, symmetrical from 04/24/2014 to 05/21/2014
-2.52%1,920.213.89%S and P 500 (^GSPC)Head-and-shoulders top from 11/18/2013 to 12/09/2013
-2.85%16,429.47-0.89%DJ 30 Industrials (^DJI)Channel from 05/27/2014 to 07/25/2014
-4.70%532.018.45%DJ 15 Utilities (^DJU)Head-and-shoulders top from 04/17/2014 to 05/07/2014

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Below are the top 10 country exchange traded funds with the best performance this past week out of 26 ETFs. These may highlight emerging markets that are ready to soar.

Week
Change
Last
Close
YTDFundMost Recent Chart Pattern
-0.07%$80.1516.75%MSCI Thailand Invest Mkt Index (THD)Double Top, Eve and Eve from 04/17/2014 to 05/02/2014
-0.48%$52.027.43%MSCI Israel Cap Invest Mt Index (EIS)Triangle, ascending from 04/21/2014 to 06/05/2014
-0.62%$15.920.63%MSCI Malaysia Index (EWM)Rectangle top from 05/08/2014 to 07/24/2014
-1.07%$13.925.69%MSCI Singapore Index (EWS)Triangle, symmetrical from 12/14/2012 to 02/08/2013
-1.14%$21.725.44%MSCI Hong Kong Index fund (EWH)Big W from 02/05/2014 to 03/20/2014
-1.79%$69.151.69%MSCI Mexico Investable Mkt idx (EWW)Scallop, ascending and inverted from 03/14/2014 to 04/25/2014
-1.87%$65.611.45%MSCI South Korea Index (EWY)Triple top from 05/09/2013 to 06/03/2013
-2.02%$50.047.08%MSCI Pacific ex-Japan Index fund (EPP)Broadening top from 07/17/2013 to 09/11/2013
-2.19%$69.547.83%MSCI South Africa Index (EZA)Double Top, Adam and Adam from 09/18/2013 to 10/22/2013
-2.30%$43.794.77%MSCI Emerging Markets Index fund (EEM)Double Top, Adam and Adam from 07/23/2013 to 08/14/2013

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Below are the top 10 country exchange traded funds with the best performance year to date out of 26 ETFs. Finding several countries from a similar region that is performing well helps identify which international mutual fund or ETF may continue to do well in the future.

YTD
Change
Last
Close
FundMost Recent Chart Pattern
17.50%$56.00MSCI Turkey Index (TUR)Triangle, symmetrical from 02/03/2014 to 03/13/2014
16.75%$80.15MSCI Thailand Invest Mkt Index (THD)Double Top, Eve and Eve from 04/17/2014 to 05/02/2014
8.54%$31.65MSCI Canada Index (EWC)Double Bottom, Adam and Adam from 06/24/2013 to 07/05/2013
8.35%$48.41MSCI Brazil Index fund (EWZ)Scallop, ascending from 09/20/2013 to 10/16/2013
7.83%$69.54MSCI South Africa Index (EZA)Double Top, Adam and Adam from 09/18/2013 to 10/22/2013
7.67%$26.24MSCI Australia Index fund (EWA)Rectangle top from 04/09/2014 to 07/17/2014
7.63%$15.52MSCI Taiwan Index (EWT)Head-and-shoulders bottom from 01/09/2014 to 02/25/2014
7.43%$52.02MSCI Israel Cap Invest Mt Index (EIS)Triangle, ascending from 04/21/2014 to 06/05/2014
7.08%$50.04MSCI Pacific ex-Japan Index fund (EPP)Broadening top from 07/17/2013 to 09/11/2013
5.69%$13.92MSCI Singapore Index (EWS)Triangle, symmetrical from 12/14/2012 to 02/08/2013

 

-- Thomas Bulkowski

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Tuesday 12/17/13. Trading Tuesday: Dow

The index climbed by 0.8% or 129.21 points. Since 10/01/1928 the index made 552 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.7% on 305 occasions.
     Average loss was -0.7% on 247 occasions.
Expect the index to close higher 55.3% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 62/95 or 65.3% of the time.
     The prediction of the index closing lower has been right 19/31 or 61.3% of the time.

Picture of the Dow industrials on the 5 minute scale.

Since I post this entry the night before, be sure to check how the futures are trading before the market opens. Large plus or minus numbers in the futures often sets the opening direction up or down, respectively.

I show a picture of the Dow industrials on the 5-minute scale from Monday's trading.

If you missed the first ten minutes of the day, you might have just packed up your trading tools and went Christmas shopping. Those first ten minutes are when the action occurred.

After that, the index bobbled up and down like a cork floating on a pond. A rectangle bottom formed when the index went horizontal. Depending on how carefully you drew the bottom red trendline, the rectangle could have broken out downward at 1:00. Then it broke out upward at 2:00. It busted the downward breakout, in other words.

My stats say rectangles with downward breakouts bust 28% of the time (single bust, like that shown). But the busting can continue such that 42% of all rectangles will suffer some type of bust (one, two, three or more busts) before shooting off and trending. That's not exactly heart warming.

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Dow industrials, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2013 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  15,407.85    
 Weekly S2  15,527.64  119.79   
 Monthly S1  15,646.21  118.57   
 Daily S2  15,687.45  41.24   
 Weekly S1  15,706.11  18.66   
 Low  15,759.60  53.49   
 Open  15,759.60  0.00   Yes! The Open is close to the Low.
 Daily S1  15,786.01  26.41   
 61.8% Down from Intraday High  15,824.81  38.80   
 50% Down from Intraday High  15,844.96  20.14   
 Daily Pivot  15,858.16  13.21   Yes! The Daily Pivot is close to the 50% Down from Intraday High.
 38.2% Down from Intraday High  15,865.10  6.94   Yes! The 38.2% Down from Intraday High is close to the Daily Pivot.
 Weekly Pivot  15,882.25  17.15   
 Close  15,884.57  2.32   Yes! The Close is close to the Weekly Pivot.
 Monthly Pivot  15,910.36  25.79   
 High  15,930.31  19.95   
 Daily R1  15,956.72  26.41   
 Daily R2  16,028.87  72.15   
 Weekly R1  16,060.72  31.85   
 Monthly R1  16,148.72  88.00   
 Weekly R2  16,236.86  88.14   
 Monthly R2  16,412.87  176.01   

Monday 12/16/13. Market Monday: The Week Ahead

My Prediction

Picture of the Dow transports on the daily scale.

I show the Dow transports on the daily scale.

A head-and-shoulders top appears in the index. The pattern confirmed when the index closed below the up-sloping red neckline at A. That was a sell signal or was it?

Something tells me it's fake. The index can make a strong move down. It's shown that in the past (as well as strong moves up). But my feeling is this drop won't amount to much. I expect the index to soar to new highs. I could be wrong about all of this, of course.

 

 

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A Brief Look Back

Picture of a flower from my garden.

The following are economic reports that moved the markets last week. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Up 5.33 points.
Tuesday: Down 52.4 points.
Wednesday: Down 129.6 points.
Thursday: Down 104.1 points.
Friday: Up 15.93 points.

For the Week...

The Dow industrials were down 264.84 points or 1.7%.
The Nasdaq composite was down 61.54 points or 1.5%.
The S&P 500 index was down 29.77 points or 1.6%.

Year to Date...

Dow Industrials
     2.6% down from the high of 16,174.51 on 11/29/2013.
     20.2% up from the low of 13,104.30 on 01/02/2013.
Nasdaq
     2.0% down from the high of 4,081.78 on 12/09/2013.
     30.0% up from the low of 3,076.60 on 01/08/2013.
S&P 500
     2.1% down from the high of 1,813.55 on 11/29/2013.
     24.5% up from the low of 1,426.19 on 01/02/2013.

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Economic Reports

The following information is derived from yahoo!finance and sometimes Bloomberg.com with times local to the east coast.

ReportTimeA-F
Rating
Description
Productivity & costs8:30 MD+Cost of producing a unit of output.
Capacity utilization9:15 MB-Gauges economic activity, hints of inflation.
Industrial production9:15 MB-Production of utilities, mines, and manufacturers.
Consumer price index8:30 TB+Inflation report. Measures cost of goods and services.
Housing starts8:30 WB-Number of homes beginning construction.
Building permits8:30 WB-Measures building permits for new construction.
Crude inventories10:30 W?My guess: Measures oil inventory.
FOMC Rate decision2:00 W?The Federal Reserves reports on interest rate changes.
Initial jobless claims8:30 ThC+Counts people filing for state unemployment benefits.
Existing home sales10:00 ThCCounts sales of used homes.
Leading indicators10:00 ThD-Summary of already known reports.
Gross domestic product8:30 FBMeasures economic activity; GDP deflator measures inflation.

Options Expiration

The following is courtesy of the Options Industry Council.

OptionDate
VIX expiresWednesday
A.M. settled index options cease trading.Thursday
Expiring equity and P.M. settled index options cease trading. Expiring cash-settled currency options cease trading at 12:00 P.M. EST.Friday
Equity, index, and cash-settled currency options expireSaturday

Many options expire this week, so traders will be looking to close out their positions ahead of that, and that suggests increased volatility (large daily price swings).

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Swing and Position Traders: Chart Pattern Indicator

As of 12/13/2013, the CPI had:

10 bearish patterns,
5 bullish patterns,
333 patterns waiting for breakout.
The CPI signal is 33.3%, which is bearish (<= 35%).

The chart pattern indicator is bearish with 1 of 3 full triangles showing (). Additional triangles are a measure of strength with solid triangles meaning a more reliable signal than half triangles.

Swing Traders: Pivot Points

The following is based on an SFO article in December 2004 by John Seekinger, titled, "Take a two-dimensional approach." He offers these tips.

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  15,680  15,718  15,755  15,793  15,830 
Weekly  15,485  15,620  15,839  15,975  16,194 
Monthly  15,365  15,560  15,867  16,063  16,370 
S&P 500 (^GSPC): Daily  1,768  1,772  1,776  1,780  1,785 
Weekly  1,747  1,761  1,786  1,800  1,826 
Monthly  1,730  1,753  1,783  1,806  1,836 
Nasdaq (^IXIC): Daily  3,978  3,990  4,004  4,015  4,029 
Weekly  3,936  3,968  4,025  4,058  4,115 
Monthly  3,812  3,906  3,994  4,089  4,176 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

Pivot point: P = (H + L + C)/3
First resistance level: R1 = (2 * P) - L
First support level: S1 = (2 * P) - H)
Second resistance level: R2 = P + (R1 - S1)
Second support level: S2 = P - (R1 - S1)
H = high price , L=low price, C=closing price

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Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 2 weeks down 16.8%   Expect a reversal soon. 
 1 month down 19.9%   Expect a reversal soon. 
 S & P 500 (^GSPC) 2 weeks down 15.6%   Expect a reversal soon. 
 1 month down 20.8%   Expect a reversal soon. 
 Nasdaq composite (^IXIC) 1 week down 30.8%   The trend may continue. 
 1 month down 26.0%   The trend may continue. 

How long can an index close higher (or lower) each day? The adjacent table shows how often consecutive up or down closes occur in the indices, based on the most recent trend of closes.

Low percentages suggest the market is overdue to turn (think of it as the likelihood that next week or next month will continue the trend, based on historical performance). Values of 50% mean random, so most percentages will be lower.

The analysis uses data going back 10 years for weekly percentages and 25 years for monthly percentages (or the start of data, whichever is more recent). Any unchanged closing price is interpreted as the end of the string of consecutive up or down closes.

Buy-and-Hold: 12-Month SMA

This indicator warns of an index moving into or out of a bear market. It's based on a 12-month simple moving average of monthly closing prices, so it only changes monthly. See 12-Month Moving Average for more details.
Dow Industrials: bullish.
Nasdaq Composite: bullish.
S&P 500 Index: bullish.
Dow Transports: bullish.
Dow Utilities: bearish.

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Earnings, Chart Patterns & Industries

Earnings season is over.

Mutual funds will begin dividend distributions and rebalancing their portfolios for the approaching year end (starts in late November).

 Found Chart Pattern Name
21Triangle, symmetrical
19Head-and-shoulders top
10Channel
8Triangle, ascending
7Rising wedge
7Pipe top
5Pennant
5Double Top, Adam and Adam
5Diamond top
5Broadening top

Large numbers of bullish or bearish chart patterns can signal short- to intermediate-term market trends (many bullish chart patterns can mean an uptrend will continue, for example). However, please realize that the short-term price trend could have changed since the pattern was discovered (this is especially true of pipe tops or bottoms, which are weekly patterns).

The 10 types of most frequently appearing chart patterns in the stocks, indices, and long-only exchange traded funds I follow during the last month are shown in the adjacent table.

 

 

 

 

The industries I follow were the best (rank 1) and worst performing.

This WeekLast Week
1. Shoe1. Shoe
2. Internet2. Internet
3. Air Transport3. Air Transport
4. Human Resources4. Computer Software and Svcs
5. Computer Software and Svcs5. Insurance (Life)
50. Electric Utility (West)50. Electric Utility (West)
51. Medical Supplies51. Cement and Aggregates
52. Toiletries/Cosmetics52. Toiletries/Cosmetics
53. Homebuilding53. Homebuilding
54. Short ETFs54. Short ETFs

-- Thomas Bulkowski

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Thursday 12/12/13. Trading Thursday: Nasdaq

The index dropped by -1.4% or -56.68 points. Since 02/05/1971 the index made 97 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.9% on 38 occasions.
     Average loss was -1.5% on 59 occasions.
Expect the index to close lower 60.8% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 53/86 or 61.6% of the time.
     The prediction of the index closing lower has been right 22/43 or 51.2% of the time.

Picture of the Nasdaq composite on the 5 minute scale.

Since I post this entry the night before, be sure to check how the futures are trading before the market opens. Large plus or minus numbers in the futures often sets the opening direction up or down, respectively.

I show a picture of the Nasdaq composite on the 5-minute scale from Wednesday's trading.

The index formed a rectangle bottom at A. That suffered a downward breakout which led to pattern B. That's a broadening formation, right-angled and ascending. That pattern also broke out downward.

Both patterns met or exceeded their measure rule targets, which is the height of each pattern subtracted from the breakout price. That gives a price target. It looks to me as if the index wants to retrace some of the losses, so we may get a bounce tomorrow (Thursday), at least in the morning. That's a guess, so anything can happen overnight.

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Nasdaq composite, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2013 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  3,761.46    
 Monthly S1  3,882.63  121.18   
 Daily S2  3,956.44  73.81   
 Weekly S2  3,961.04  4.60   Yes! The Weekly S2 is close to the Daily S2.
 Monthly Pivot  3,976.25  15.20   
 Daily S1  3,980.13  3.88   Yes! The Daily S1 is close to the Monthly Pivot.
 Weekly S1  3,982.43  2.30   Yes! The Weekly S1 is close to the Daily S1.
 Low  3,998.92  16.49   
 Close  4,003.81  4.89   Yes! The Close is close to the Low.
 Daily Pivot  4,022.60  18.79   
 61.8% Down from Intraday High  4,024.19  1.59   Yes! The 61.8% Down from Intraday High is close to the Daily Pivot.
 Weekly Pivot  4,026.14  1.95   Yes! The Weekly Pivot is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  4,032.00  5.86   Yes! The 50% Down from Intraday High is close to the Weekly Pivot.
 38.2% Down from Intraday High  4,039.81  7.81   
 Daily R1  4,046.29  6.48   Yes! The Daily R1 is close to the 38.2% Down from Intraday High.
 Weekly R1  4,047.53  1.24   Yes! The Weekly R1 is close to the Daily R1.
 Open  4,061.67  14.14   
 High  4,065.08  3.41   Yes! The High is close to the Open.
 Daily R2  4,088.76  23.68   
 Weekly R2  4,091.24  2.48   Yes! The Weekly R2 is close to the Daily R2.
 Monthly R1  4,097.42  6.18   Yes! The Monthly R1 is close to the Weekly R2.
 Monthly R2  4,191.04  93.61   

Tuesday 12/10/13. Trading Tuesday: Dow

The index climbed by 0.0% or 5.33 points. Since 10/01/1928 the index made 1192 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.6% on 632 occasions.
     Average loss was -0.7% on 560 occasions.
Expect the index to close higher 53.0% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 62/94 or 66.0% of the time.
     The prediction of the index closing lower has been right 19/31 or 61.3% of the time.

Picture of the Dow industrials on the 5 minute scale.

Since I post this entry the night before, be sure to check how the futures are trading before the market opens. Large plus or minus numbers in the futures often sets the opening direction up or down, respectively.

I show a picture of the Dow industrials on the 5-minute scale from Monday's trading.

This was a sloppy, directionless day. The index formed a symmetrical triangle at A. The triangle staged a downward breakout at D but the decline didn't last long. The index waffled up and down, eventually forming double top BC which had a downward breakout at E. Again, the drop didn't amount to much.

In short, this was a trendless day better spent getting exercise by shoveling snow off the driveway than playing the markets.

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Dow industrials, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2013 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  15,255.08    
 Monthly S1  15,640.30  385.23   
 Weekly S2  15,664.90  24.59   
 Weekly S1  15,845.21  180.32   
 Monthly Pivot  15,907.41  62.19   
 Weekly Pivot  15,971.61  64.20   
 Daily S2  15,989.96  18.36   
 Daily S1  16,007.75  17.78   
 Low  16,015.29  7.54   
 Open  16,019.49  4.20   Yes! The Open is close to the Low.
 Close  16,025.53  6.04   
 61.8% Down from Intraday High  16,031.76  6.23   
 Daily Pivot  16,033.07  1.32   Yes! The Daily Pivot is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  16,036.84  3.77   Yes! The 50% Down from Intraday High is close to the Daily Pivot.
 38.2% Down from Intraday High  16,041.93  5.09   
 Daily R1  16,050.86  8.92   
 High  16,058.40  7.54   
 Daily R2  16,076.18  17.78   
 Weekly R1  16,151.92  75.74   
 Weekly R2  16,278.32  126.39   
 Monthly R1  16,292.63  14.32   
 Monthly R2  16,559.74  267.10   

Monday 12/9/13. Market Monday: The Week Ahead

My Prediction

Picture of the S and P 500 index on the daily scale.

I show the S & P 500 index on the daily scale.

This is the rising wedge I remarked on in a previous post. The index touches or is near each trendline several times, making for a nice looking wedge.

The wedge broke out downward and curled around to A. That's a pullback. I'm hoping that price will continue moving higher. In studies I have done of pullbacks in stocks, the continue rising 53% of the time (47% drop).

Will that be the case? I think so, but that's just a guess. I've been bullish for years now and the market has rewarded me for that beief.

 

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A Brief Look Back

Picture of a flower from my garden.

The following are economic reports that moved the markets last week. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Down 77.64 points.
Tuesday: Down 94.15 points.
Wednesday: Down 24.85 points.
Thursday: Down 68.26 points.
Friday: Up 198.69 points.

For the Week...

The Dow industrials were down 66.21 points or 0.4%.
The Nasdaq composite was up 2.63 points or 0.1%.
The S&P 500 index was down 0.72 points or 0.0%.

Year to Date...

Dow Industrials
     1.0% down from the high of 16,174.51 on 11/29/2013.
     22.3% up from the low of 13,104.30 on 01/02/2013.
Nasdaq
     0.2% down from the high of 4,069.86 on 12/06/2013.
     32.0% up from the low of 3,076.60 on 01/08/2013.
S&P 500
     0.5% down from the high of 1,813.55 on 11/29/2013.
     26.6% up from the low of 1,426.19 on 01/02/2013.

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Economic Reports

The following information is derived from yahoo!finance and sometimes Bloomberg.com with times local to the east coast.

ReportTimeA-F
Rating
Description
Wholesale inventories10:00 TD-Wholesale sales and inventory statistics.
Crude inventories10:30 W?My guess: Measures oil inventory.
Treasury budget2:00 WDTracks budget deficit. Important in April (tax filing).
Initial jobless claims8:30 ThC+Counts people filing for state unemployment benefits.
Retail sales8:30 ThA-Reports total retail sales (not services). Are people spending?
International trade8:30 ThC+Import/export prices, trade balance. US economy vs others.
Business inventories10:00 ThC-Reports manufacturing, wholesale, retail inventories.
Producer price index8:30 FB-Measures wholesale goods cost. An indication of future inflation.

Options Expiration

No options expire this week.

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Swing and Position Traders: Chart Pattern Indicator

As of 12/06/2013, the CPI had:

10 bearish patterns,
16 bullish patterns,
203 patterns waiting for breakout.
The CPI signal is 61.5%, which is neutral (between 35% and 65%).

The chart pattern indicator is bullish with 1 of 3 full triangles showing (). Additional triangles are a measure of strength with solid triangles meaning a more reliable signal than half triangles.

Swing Traders: Pivot Points

The following is based on an SFO article in December 2004 by John Seekinger, titled, "Take a two-dimensional approach." He offers these tips.

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  15,759  15,890  15,956  16,087  16,153 
Weekly  15,663  15,842  15,970  16,148  16,277 
Monthly  15,253  15,637  15,906  16,289  16,558 
S&P 500 (^GSPC): Daily  1,782  1,794  1,800  1,811  1,818 
Weekly  1,767  1,786  1,798  1,817  1,829 
Monthly  1,721  1,763  1,788  1,830  1,856 
Nasdaq (^IXIC): Daily  4,031  4,047  4,058  4,074  4,086 
Weekly  3,981  4,022  4,046  4,087  4,111 
Monthly  3,781  3,922  3,996  4,137  4,211 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

Pivot point: P = (H + L + C)/3
First resistance level: R1 = (2 * P) - L
First support level: S1 = (2 * P) - H)
Second resistance level: R2 = P + (R1 - S1)
Second support level: S2 = P - (R1 - S1)
H = high price , L=low price, C=closing price

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Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 1 week down 29.1%   The trend may continue. 
 1 month down 19.9%   Expect a reversal soon. 
 S & P 500 (^GSPC) 1 week down 27.5%   The trend may continue. 
 1 month down 20.8%   Expect a reversal soon. 
 Nasdaq composite (^IXIC) 4 weeks up 17.2%   Expect a reversal soon. 
 4 months up 20.5%   Expect a reversal soon. 

How long can an index close higher (or lower) each day? The adjacent table shows how often consecutive up or down closes occur in the indices, based on the most recent trend of closes.

Low percentages suggest the market is overdue to turn (think of it as the likelihood that next week or next month will continue the trend, based on historical performance). Values of 50% mean random, so most percentages will be lower.

The analysis uses data going back 10 years for weekly percentages and 25 years for monthly percentages (or the start of data, whichever is more recent). Any unchanged closing price is interpreted as the end of the string of consecutive up or down closes.

Buy-and-Hold: 12-Month SMA

This indicator warns of an index moving into or out of a bear market. It's based on a 12-month simple moving average of monthly closing prices, so it only changes monthly. See 12-Month Moving Average for more details.
Dow Industrials: bullish.
Nasdaq Composite: bullish.
S&P 500 Index: bullish.
Dow Transports: bullish.
Dow Utilities: bearish.

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Earnings, Chart Patterns & Industries

Earnings season is over.

Mutual funds will begin dividend distributions and rebalancing their portfolios for the approaching year end (starts in late November).

 Found Chart Pattern Name
20Triangle, symmetrical
12Channel
10Pipe bottom
9Head-and-shoulders top
7Rising wedge
7Diamond top
7Triangle, ascending
5Double Bottom, Adam and Adam
5Pennant
5Broadening top

Large numbers of bullish or bearish chart patterns can signal short- to intermediate-term market trends (many bullish chart patterns can mean an uptrend will continue, for example). However, please realize that the short-term price trend could have changed since the pattern was discovered (this is especially true of pipe tops or bottoms, which are weekly patterns).

The 10 types of most frequently appearing chart patterns in the stocks, indices, and long-only exchange traded funds I follow during the last month are shown in the adjacent table.

 

 

 

 

The industries I follow were the best (rank 1) and worst performing.

This WeekLast Week
1. Shoe1. Internet
2. Internet2. Shoe
3. Air Transport3. Air Transport
4. Computer Software and Svcs4. Aerospace/Defense
5. Insurance (Life)5. Human Resources
50. Electric Utility (West)50. Toiletries/Cosmetics
51. Cement and Aggregates51. Electric Utility (West)
52. Toiletries/Cosmetics52. Cement and Aggregates
53. Homebuilding53. Homebuilding
54. Short ETFs54. Short ETFs

-- Thomas Bulkowski

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Thursday 12/5/13. Trading Thursday: Nasdaq

The index climbed by 0.0% or 0.8 points. Since 02/05/1971 the index made 581 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.8% on 325 occasions.
     Average loss was -1.0% on 256 occasions.
Expect the index to close higher 55.9% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 53/85 or 62.4% of the time.
     The prediction of the index closing lower has been right 22/43 or 51.2% of the time.

Picture of the Nasdaq composite on the 5 minute scale.

Since I post this entry the night before, be sure to check how the futures are trading before the market opens. Large plus or minus numbers in the futures often sets the opening direction up or down, respectively.

I show a picture of the Nasdaq composite on the 5-minute scale from Wednesday's trading.

Today's trading was one of those rare days in which no obvious chart patterns appear. Yes, you can make the case for a rounding top, a channel, maybe a rectangle. Maybe a scallop. Okay, so maybe there's more potential patterns here than I realized. But they don't jump out at you.

The one that caught my eye was the measured move up, at ABCD. The second leg (CD) is supposed to be the same length as the first leg, AB. What I find important about measured moves is that price often retraces back to the corrective phase, BC. That hasn't happened yet due to the market's close. And it's doubtful the index will pick up on Thursday from where it left off. Also, the two legs aren't the same length, but they are close.

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Nasdaq composite, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2013 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  3,772.96    
 Monthly S1  3,905.48  132.52   
 Weekly S2  3,949.08  43.60   
 Daily S2  3,984.53  35.45   
 Monthly Pivot  3,987.59  3.06   Yes! The Monthly Pivot is close to the Daily S2.
 Weekly S1  3,993.54  5.95   
 Low  4,004.76  11.22   
 Daily S1  4,011.26  6.50   
 Open  4,020.33  9.07   
 61.8% Down from Intraday High  4,022.70  2.37   Yes! The 61.8% Down from Intraday High is close to the Open.
 50% Down from Intraday High  4,028.25  5.54   
 Daily Pivot  4,031.50  3.25   Yes! The Daily Pivot is close to the 50% Down from Intraday High.
 Weekly Pivot  4,031.62  0.12   Yes! The Weekly Pivot is close to the Daily Pivot.
 38.2% Down from Intraday High  4,033.79  2.17   Yes! The 38.2% Down from Intraday High is close to the Weekly Pivot.
 Close  4,038.00  4.21   Yes! The Close is close to the 38.2% Down from Intraday High.
 High  4,051.73  13.73   
 Daily R1  4,058.23  6.50   
 Weekly R1  4,076.08  17.85   
 Daily R2  4,078.47  2.39   Yes! The Daily R2 is close to the Weekly R1.
 Weekly R2  4,114.16  35.69   
 Monthly R1  4,120.11  5.95   
 Monthly R2  4,202.22  82.11   

Tuesday 12/3/13. Trading Tuesday: Dow

The index dropped by -0.5% or -77.64 points. Since 10/01/1928 the index made 719 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.7% on 355 occasions.
     Average loss was -0.8% on 364 occasions.
Expect the index to close lower 50.6% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 62/94 or 66.0% of the time.
     The prediction of the index closing lower has been right 18/30 or 60.0% of the time.

Picture of the Dow industrials on the 5 minute scale.

Since I post this entry the night before, be sure to check how the futures are trading before the market opens. Large plus or minus numbers in the futures often sets the opening direction up or down, respectively.

I show a picture of the Dow industrials on the 5-minute scale from Monday's trading.

In blue is a channel. This one breaks out downward at A. It suggests a short sale might work well, which it does. Later in the afternoon, a rectangle bottom appears. This also has a downward breakout (at B). The drop after that was a good one, fulfilling the measure rule target (the height of the rectangle subtracted from B).

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Dow industrials, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2013 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  15,237.20    
 Monthly S1  15,622.98  385.79   
 Monthly Pivot  15,898.75  275.76   
 Daily S2  15,919.23  20.48   
 Weekly S2  15,960.53  41.30   
 Daily S1  15,964.00  3.47   Yes! The Daily S1 is close to the Weekly S2.
 Weekly S1  15,984.65  20.65   
 Low  15,986.23  1.58   Yes! The Low is close to the Weekly S1.
 Close  16,008.77  22.54   
 61.8% Down from Intraday High  16,028.93  20.16   
 Daily Pivot  16,031.00  2.07   Yes! The Daily Pivot is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  16,042.12  11.12   Yes! The 50% Down from Intraday High is close to the Daily Pivot.
 38.2% Down from Intraday High  16,055.30  13.19   
 Daily R1  16,075.77  20.47   
 Weekly Pivot  16,079.58  3.81   Yes! The Weekly Pivot is close to the Daily R1.
 Open  16,087.12  7.54   Yes! The Open is close to the Weekly Pivot.
 High  16,098.00  10.88   Yes! The High is close to the Open.
 Weekly R1  16,103.70  5.70   Yes! The Weekly R1 is close to the High.
 Daily R2  16,142.77  39.07   
 Weekly R2  16,198.63  55.86   
 Monthly R1  16,284.53  85.90   
 Monthly R2  16,560.30  275.76   

Monday 12/2/13. Market Monday: The Week Ahead

My Prediction

Picture of the Nasdaq on the daily scale.

I show the Nasdaq Composite on the daily scale.

This turned from a boring pic to an interesting one. Look at AB. It's an inverted and ascending scallop.

Pattern BC is also an inverted and ascending scallop. Notice that it's not as wide as the first one. I've noticed that when you get three smaller scallops in an ascending series, it can mark the end of the up trend. However, the second scallop is taller than the first (as a rough calculation), so maybe this is not an indication of weakness.

Plus there should be three scallops in the series. We only see two here.

 

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A Brief Look Back

Picture of a lizard from my garden.

The following are economic reports that moved the markets last week. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Up 7.77 points.
Tuesday: Up 0.26 points.
Wednesday: Up 24.53 points.
Friday: Down 10.92 points.
Saturday: Holiday or other weird event!

For the Week...

The Dow industrials were up 21.64 points or 0.1%.
The Nasdaq composite was up 68.24 points or 1.7%.
The S&P 500 index was up 1.05 points or 0.1%.

Year to Date...

Dow Industrials
     0.5% down from the high of 16,174.51 on 11/29/2013.
     22.8% up from the low of 13,104.30 on 01/02/2013.
Nasdaq
     0.2% down from the high of 4,069.70 on 11/29/2013.
     32.0% up from the low of 3,076.60 on 01/08/2013.
S&P 500
     0.4% down from the high of 1,813.55 on 11/29/2013.
     26.6% up from the low of 1,426.19 on 01/02/2013.

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Economic Reports

The following information is derived from yahoo!finance and sometimes Bloomberg.com with times local to the east coast.

ReportTimeA-F
Rating
Description
Construction spending10:00 MDCovers residential/non-residential/public spending on new construction.
Auto & truck sales2:00 TC-Monthly sales of domestically produced vehicles.
Trade balance8:30 WC+Signals balance of exports & imports.
New home sales10:00 WC+Shows sales of single-family homes.
Crude inventories10:30 W?My guess: Measures oil inventory.
FEDs Beige book2:00 W?Reports on economic conditions.
Initial jobless claims8:30 ThC+Counts people filing for state unemployment benefits.
Gross domestic product8:30 ThBMeasures economic activity; GDP deflator measures inflation.
Factory orders10:00 ThD+Durable/non-durable goods orders w/factory inventories.
4 Employment reports8:30 FANonfarm payrolls, unemployment rate, avg workweek, hourly earnings.
Personal income & consumption8:30 FC+Measures sources of income to predict future demand.
Personal consumption expenditures8:30 FC+Covers durables, non-durables, and services.
Consumer credit3:00 FD-Measures auto, credit card and other debt.

Options Expiration

No options expire this week.

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Swing and Position Traders: Chart Pattern Indicator

As of 11/29/2013, the CPI had:

10 bearish patterns,
23 bullish patterns,
444 patterns waiting for breakout.
The CPI signal is 69.7%, which is bullish (>= 65%).

The chart pattern indicator is bullish with 1 of 3 full triangles showing (). Additional triangles are a measure of strength with solid triangles meaning a more reliable signal than half triangles.

Swing Traders: Pivot Points

The following is based on an SFO article in December 2004 by John Seekinger, titled, "Take a two-dimensional approach." He offers these tips.

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  16,011  16,049  16,112  16,149  16,212 
Weekly  15,986  16,036  16,105  16,155  16,225 
Monthly  15,263  15,675  15,925  16,336  16,586 
S&P 500 (^GSPC): Daily  1,798  1,802  1,808  1,812  1,817 
Weekly  1,794  1,800  1,807  1,813  1,820 
Monthly  1,721  1,763  1,789  1,831  1,856 
Nasdaq (^IXIC): Daily  4,047  4,054  4,062  4,068  4,076 
Weekly  3,956  4,008  4,039  4,091  4,121 
Monthly  3,780  3,920  3,995  4,135  4,210 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

Pivot point: P = (H + L + C)/3
First resistance level: R1 = (2 * P) - L
First support level: S1 = (2 * P) - H)
Second resistance level: R2 = P + (R1 - S1)
Second support level: S2 = P - (R1 - S1)
H = high price , L=low price, C=closing price

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Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 8 weeks up 0.0%   Expect a reversal soon. 
 3 months up 25.7%   The trend may continue. 
 S & P 500 (^GSPC) 8 weeks up 1.6%   Expect a reversal soon. 
 3 months up 33.4%   The trend may continue. 
 Nasdaq composite (^IXIC) 3 weeks up 22.1%   Expect a reversal soon. 
 3 months up 29.6%   The trend may continue. 

How long can an index close higher (or lower) each day? The adjacent table shows how often consecutive up or down closes occur in the indices, based on the most recent trend of closes.

Low percentages suggest the market is overdue to turn (think of it as the likelihood that next week or next month will continue the trend, based on historical performance). Values of 50% mean random, so most percentages will be lower.

The analysis uses data going back 10 years for weekly percentages and 25 years for monthly percentages (or the start of data, whichever is more recent). Any unchanged closing price is interpreted as the end of the string of consecutive up or down closes.

Buy-and-Hold: 12-Month SMA

This indicator warns of an index moving into or out of a bear market. It's based on a 12-month simple moving average of monthly closing prices, so it only changes monthly. See 12-Month Moving Average for more details.
Dow Industrials: bullish.
Nasdaq Composite: bullish.
S&P 500 Index: bullish.
Dow Transports: bullish.
Dow Utilities: bullish.

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Earnings, Chart Patterns & Industries

Earnings season is either underway or should be starting soon. The sessions could be more volatile.

Mutual funds will begin dividend distributions and rebalancing their portfolios for the approaching year end (starts in late November).

 Found Chart Pattern Name
13Triangle, symmetrical
12Pipe bottom
11Channel
9Head-and-shoulders top
6Flag
6Broadening top
6Rectangle top
6Triangle, ascending
5Pennant
4Scallop, ascending and inverted

Large numbers of bullish or bearish chart patterns can signal short- to intermediate-term market trends (many bullish chart patterns can mean an uptrend will continue, for example). However, please realize that the short-term price trend could have changed since the pattern was discovered (this is especially true of pipe tops or bottoms, which are weekly patterns).

The 10 types of most frequently appearing chart patterns in the stocks, indices, and long-only exchange traded funds I follow during the last month are shown in the adjacent table.

 

 

 

 

The industries I follow were the best (rank 1) and worst performing.

This WeekLast Week
1. Internet1. Shoe
2. Shoe2. Insurance (Life)
3. Air Transport3. Internet
4. Aerospace/Defense4. Aerospace/Defense
5. Human Resources5. Air Transport
50. Toiletries/Cosmetics50. Cement and Aggregates
51. Electric Utility (West)51. Toiletries/Cosmetics
52. Cement and Aggregates52. Electric Utility (West)
53. Homebuilding53. Short ETFs
54. Short ETFs54. Homebuilding

-- Thomas Bulkowski

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