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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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Busted
Patterns
Candles Chart
Patterns
Event
Patterns
Small Patterns
Market
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
As of 09/20/2017
22,413 41.79 0.2%
9,654 147.29 1.5%
732 -5.08 -0.7%
6,456 -5.28 -0.1%
2,508 1.59 0.1%
YTD
13.4%
6.8%
10.9%
19.9%
12.0%
Tom's Targets    Overview: 09/14/2017
22,450 or 21,500 by 10/01/2017
9,750 or 9,200 by 10/01/2017
775 or 730 by 10/01/2017
6,650 or 6,200 by 10/01/2017
2,600 or 2,425 by 10/01/2017

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December 2014 Headlines


Archives


Wednesday 12/31/14. Chart Pattern Indicator: Bad News Coming

Picture of the chart pattern indicator

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

I swapped targets for the indices over the next two weeks. I have a feeling that they will retrace their gains since we bottomed in mid December.

The indicator isn't there yet. It shows we are still bullish but curving down. The market was weak today and that's why the indicator dipped.

Picture of the chart pattern indicator

This is another view of the CPI only it shows signal changes.

The chart doesn't show the weakness yet. It's still green, but if we get a strong decline, it'll flip to bearish. I don't expect that to happen. Rather, I think the index will ease lower in the coming two weeks, taking the CPI into neutral then bearish territory.

However, I leave open the possibility that the new year will bring prosperity and the index will soar. I don't really believe that, but it's still possible.

Yes, Noam, I'll do the year ahead look tomorrow.

-- Thomas Bulkowski

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Tuesday 12/30/14. Rectangle in the Dow

The index dropped by -0.1% or -15.48 points. Since 10/01/1928 the index made 1246 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.7% on 649 occasions.
     Average loss was -0.8% on 597 occasions.
Expect the index to close higher 52.1% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 87/138 or 63.0% of the time.
     The prediction of the index closing lower has been right 22/41 or 53.7% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Dow industrials on the 5 minute scale.

$ $ $

I show a picture of the Dow industrials on the 5-minute scale.

Today (Monday) was a calm day as the chart shows. Trading was flat almost throughout the session. But look at the gentle upward curve over the last 10 days. Does this suggest a retrace is coming?

If so, I marked the three Fibonacci retrace values: 38% (top blue line), 50%, and 62% (bottom blue line). Those lines are approximate based on a low of about 17,100 and a top 1,000 points higher.

Marked in red is a rectangle top. A rectangle forms when the security is locked in a trading range. The length of the rectangle can last for hours on the intraday charts or for weeks to months on the daily charts.

Breakouts from rectangle tops are upward 69% of the time. It is possible that the index will resume its move upward in this holiday shortened week.

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Thanks to all of you that brightened my Christmas by clicking on the plus one feature ==>

$ $ $

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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© 2014 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  16,700.56    
 Monthly S1  17,369.40  668.83   
 Weekly S2  17,693.44  324.05   
 Monthly Pivot  17,736.42  42.98   
 Weekly S1  17,865.84  129.41   
 Weekly Pivot  17,984.64  118.81   
 Daily S2  17,992.81  8.17   
 Daily S1  18,015.52  22.71   
 Low  18,021.57  6.05   
 Close  18,038.23  16.66   
 61.8% Down from Intraday High  18,041.23  3.00   Yes! The 61.8% Down from Intraday High is close to the Close.
 Daily Pivot  18,044.28  3.05   Yes! The Daily Pivot is close to the 61.8% Down from Intraday High.
 Open  18,046.58  2.30   Yes! The Open is close to the Daily Pivot.
 50% Down from Intraday High  18,047.30  0.72   Yes! The 50% Down from Intraday High is close to the Open.
 38.2% Down from Intraday High  18,053.38  6.07   
 Daily R1  18,066.99  13.61   
 High  18,073.04  6.05   
 Daily R2  18,095.75  22.71   
 Weekly R1  18,157.04  61.29   
 Weekly R2  18,275.84  118.81   
 Monthly R1  18,405.26  129.41   
 Monthly R2  18,772.28  367.03   

Wednesday 12/24/14. Chart Pattern Indicator: What's It Say?

Picture of the chart pattern indicator

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

The chart shows nothing exciting, really. The indicator has impaled itself against the ceiling, 100. I'm scratching my head on this since my portfolio said the Dow's 154 point move 0n 12/22 seemed narrow to me (meaning I didn't make as much as I should have). Maybe it's the shortened holiday week that is throwing off my game.

Picture of the chart pattern indicator

This is another view of the CPI only it shows signal changes.

This chart shows green bars for bullish signals, white for neutral, and red for bearish. Recently, the green bars have taken over.

My worry is not about these two charts. They are bullish. Rather, it's about a possible 2B patterns. That's when a security such as the Dow rises to near or at the level of a prior peak and stops. It can rise slightly above it, as in this case, or remain slightly below it. Then you see a reversal. The reversal is often short but you never know.

$ $ $

I'm going to pretend I'm a submarine going under the ice until the close of Monday's trading. I'll be quiet until then. I'll be here, but just taking a break from my commentary duties.

If you like this site or this blog then please click the Google plus 1 (g+1) thingy immediately below. I'm supposed to have over 2,000 unique daily visitors but only 23 of you like this page. That doesn't sound right.

Have a happy and safe holiday, too.

-- Thomas Bulkowski

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Tuesday 12/23/14. Intraday Market Direction: Dow

The index climbed by 0.9% or 154.64 points. Since 10/01/1928 the index made 484 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.6% on 286 occasions.
     Average loss was -0.7% on 198 occasions.
Expect the index to close higher 59.1% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 86/137 or 62.8% of the time.
     The prediction of the index closing lower has been right 22/41 or 53.7% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Dow industrials on the 5 minute scale.

$ $ $

I show a picture of the Dow industrials on the 5-minute scale.

A double bottom appears at AB. This confirmed as a valid pattern when the index closed above the peak between the two bottoms.

More recently, a rising wedge appears at C. A rising wedge breaks out downward 69% of the time (in stocks). That suggests a lower close on Tuesday. If that happens, it will be at odds with the above probabilities which are looking for a higher close.

$ $ $

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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© 2014 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  16,749.14    
 Weekly S2  16,827.25  78.11   
 Monthly S1  17,354.29  527.04   
 Weekly S1  17,393.34  39.05   
 Weekly Pivot  17,633.69  240.34   
 Monthly Pivot  17,672.74  39.05   
 Daily S2  17,760.96  88.22   
 Low  17,812.25  51.29   
 Open  17,812.25  0.00   Yes! The Open is close to the Low.
 Daily S1  17,860.20  47.95   
 61.8% Down from Intraday High  17,869.75  9.55   Yes! The 61.8% Down from Intraday High is close to the Daily S1.
 50% Down from Intraday High  17,887.52  17.76   
 38.2% Down from Intraday High  17,905.28  17.76   
 Daily Pivot  17,911.49  6.21   Yes! The Daily Pivot is close to the 38.2% Down from Intraday High.
 Close  17,959.44  47.95   
 High  17,962.78  3.34   Yes! The High is close to the Close.
 Daily R1  18,010.73  47.95   
 Daily R2  18,062.02  51.29   
 Weekly R1  18,199.78  137.76   
 Monthly R1  18,277.89  78.11   
 Weekly R2  18,440.13  162.24   
 Monthly R2  18,596.34  156.21   

Monday 12/22/14. Pullback in the Transports

My Prediction

Picture of the Dow transports on the daily scale.

I show a picture of the Down transports on the daily scale.

The index sports a diamond top, outlined here in red. At A, the index has pulled back to the price of the breakout, just as well-behaved pullbacks should.

The question now is what happens next?

With diamond tops, the fear is that the quick rise from the low at B to the diamond will reverse. That means a decline all the way back down to not B, but just above B. (It's rare that you get a full retrace.)

Alternatively, the pullback will continue and move to higher ground. That is what you are seeing in the other indices, the Dow utilities, for example. And that is what I expect to happen in the coming week or two. This week, since it's holiday shortened, can be volatile. See my holiday article to find out what happens the day before and after the Christmas holiday, as well as other holidays.

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A Brief Look Back

Picture of a flower from my garden.

The following is a brief review of how the markets performed over time. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Down 99.99 points.
Tuesday: Down 111.97 points.
Wednesday: Up 288 points.
Thursday: Up 421.28 points.
Friday: Up 26.65 points.

For the Week...

The Dow industrials were up 523.97 points or 3.0%.
The Nasdaq composite was up 111.78 points or 2.4%.
The S&P 500 index was up 68.32 points or 3.4%.

Year to Date...

Dow Industrials
     1.0% down from the high of 17,991.19 on 12/05/2014.
     16.1% up from the low of 15,340.69 on 02/05/2014.
Nasdaq
     0.9% down from the high of 4,810.86 on 11/28/2014.
     20.8% up from the low of 3,946.03 on 04/15/2014.
S&P 500
     0.4% down from the high of 2,079.47 on 12/05/2014.
     19.1% up from the low of 1,737.92 on 02/05/2014.

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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
Existing home sales10:00 MCCounts sales of used homes.
Durable goods orders8:30 TBMeasures orders, shipments of goods with lifespans >3 years.
Gross domestic product8:30 TBMeasures economic activity; GDP deflator measures inflation.
Michigan sentiment9:55 TB-Consumer sentiment: Measures strength of consumer spending.
Personal income & consumption8:30 or 10:00? TC+Measures sources of income to predict future demand.
Personal consumption expenditures8:30 or 10:00? TC+Covers durables, non-durables, and services.
New home sales10:00 TC+Shows sales of single-family homes.
Initial jobless claims8:30 WC+Counts people filing for state unemployment benefits.
Crude inventories10:30 W?My guess: Measures oil inventory.

Options Expiration

No options expire this week.

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Swing and Position Traders: Chart Pattern Indicator

As of 12/19/2014, the CPI had:

2 bearish patterns,
24 bullish patterns,
293 patterns waiting for breakout.
The CPI signal is 92.3%, which is bullish (>= 65%).

The chart pattern indicator is bullish with 1 of 3 half 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  17,681  17,743  17,808  17,870  17,936 
Weekly  16,776  17,290  17,582  18,097  18,389 
Monthly  16,698  17,251  17,621  18,175  18,545 
S&P500 (^GSPC): Daily  2,053  2,062  2,070  2,079  2,087 
Weekly  1,935  2,003  2,040  2,108  2,146 
Monthly  1,934  2,002  2,041  2,109  2,148 
Nasdaq (^IXIC): Daily  4,718  4,742  4,762  4,786  4,806 
Weekly  4,463  4,614  4,698  4,849  4,933 
Monthly  4,444  4,605  4,708  4,868  4,971 
  • 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 up 43.8%   Expect a random direction. 
 1 month down 19.2%   Expect a reversal soon. 
 S & P 500 (^GSPC) 1 week up 43.1%   Expect a random direction. 
 3 months up 36.2%   The trend may continue. 
 Nasdaq composite (^IXIC) 1 week up 44.2%   Expect a random direction. 
 1 month down 25.3%   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 over.

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

 Found Chart Pattern Name
26Scallop, ascending and inverted
17Triangle, symmetrical
11Head-and-shoulders top
11Pipe top
9Channel
8Diamond top
8Broadening top
7Double Top, Adam and Adam
7Flag
6Broadening top, right-angled and ascending

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. Biotechnology1. Biotechnology
2. Medical Supplies2. Air Transport
3. Drug3. Shoe
4. Air Transport4. Electric Utility (West)
5. Securities Brokerage5. Medical Supplies
50. Metal Fabricating50. Cement and Aggregates
51. Petroleum (Integrated)51. Petroleum (Integrated)
52. Natural Gas (Diversified)52. Natural Gas (Diversified)
53. Oilfield Svcs/Equipment53. Oilfield Svcs/Equipment
54. Petroleum (Producing)54. Petroleum (Producing)

-- Thomas Bulkowski

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Friday 12/19/14. Pattern Trading Setups for the Weekend.

Go to Table.

You can find setups based on a Fibonacci retrace by clicking on the link.

Click the link for a list of symbols from the table.

The following patterns were found manually, so the results may differ from those found using Patternz.

There were 40 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 596 stocks searched, or 6.7%. Based on the percentage, the stock market is trending since few consolidation patterns appear.

I found 1 pipe bottom chart patterns, which is neutral. High numbers of pipe bottoms can signal a bullish move (I see many of them just before a bear market ends or during a bear market rally. Often it means the first bottom of a double bottom has formed. Thus, expect a move down to the second bottom).

Excluding ETFs, there were 21 bullish chart patterns this week and 9 bearish ones with any remaining (2) being undecided. The ratio of bullish to bearish patterns suggests the market is hinting of a coming bullish (up) turn.

In the table below, the red and green colors are based on the historical breakout direction for the associated chart pattern. If a high and tight flag appears, the start and end dates highlight the flagpole only and not the flag.

The following tips may help.

  • Look for patterns with unusual breakout directions, such as an ascending triangle with a downward breakout. The unusual breakout direction can suggest a strong run.
  • Busted patterns, where price breaks out in one direction, turns around and then breaks out in the opposite direction can lead to powerful moves.
  • Throwbacks and pullbacks occur about half the time, so be prepared for a retrace after the breakout.
  • Look for underlying support and overhead resistance to help gauge how far price will move after the breakout.

More...

Good luck. -- Thomas Bulkowski

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
ABTBroadening top, right-angled and ascending      10/31/201412/16/2014Medical Supplies
ADTNTriangle, symmetrical      09/12/201412/17/2014Telecom. Equipment
AEISFlag      12/08/201412/18/2014Semiconductor
ALKTriangle, symmetrical      11/28/201412/16/2014Air Transport
ANNPipe bottom      12/01/201412/08/2014Retail (Special Lines)
APOGScallop, ascending and inverted      10/10/201412/17/2014Building Materials
ARCBBroadening top, right-angled and ascending      11/06/201412/18/2014Trucking/Transp. Leasing
ADMScallop, ascending and inverted      10/27/201412/17/2014Food Processing
BMRNBroadening wedge, ascending      11/03/201412/17/2014Biotechnology
ETHBroadening top      11/21/201412/18/2014Furn/Home Furnishings
FDORising wedge      10/03/201412/18/2014Retail Store
FASTBroadening wedge, ascending      11/12/201412/17/2014Retail Building Supply
FOERectangle top      10/20/201412/18/2014Chemical (Specialty)
FLIRDouble Bottom, Adam and Adam      12/02/201412/17/2014Aerospace/Defense
GDScallop, ascending and inverted      10/15/201412/16/2014Aerospace/Defense
GSPipe top      12/08/201412/08/2014Securities Brokerage
HLITBroadening top      11/06/201412/17/2014Telecom. Equipment
HHSRising wedge      11/13/201412/18/2014Advertising
DHIScallop, ascending and inverted      11/05/201412/16/2014Homebuilding
IEXScallop, ascending and inverted      10/15/201412/17/2014Machinery
INTCScallop, ascending and inverted      11/12/201412/17/2014Semiconductor
LZBBroadening top      11/25/201412/18/2014Furn/Home Furnishings
NBroadening bottom      11/28/201412/18/2014E-Commerce
POLScallop, ascending and inverted      10/13/201412/16/2014Chemical (Specialty)
PFGScallop, ascending and inverted      10/15/201412/16/2014Insurance (Diversified)
PGRScallop, ascending and inverted      10/16/201412/16/2014Insurance (Prop/Casualty)
PEGScallop, ascending and inverted      11/14/201412/16/2014Electric Utility (East)
SXIHead-and-shoulders bottom      12/02/201412/17/2014Diversified Co.
TMOScallop, ascending and inverted      11/18/201412/17/2014Precision Instrument
TGBroadening top, right-angled and ascending      10/31/201412/18/2014Chemical (Specialty)
VRSNScallop, ascending and inverted      10/16/201412/17/2014Internet
XLNXPipe top      12/08/201412/08/2014Semiconductor Cap Equip.
SLVBroadening wedge, ascending      11/14/201412/18/2014Metals and Mining (Div.)
PPHScallop, ascending and inverted      10/16/201412/17/2014Drug
QQQScallop, ascending and inverted      10/15/201412/17/2014Long ETFs
IXNScallop, ascending and inverted      10/15/201412/17/2014Investment Co. (Foreign)
SSOScallop, ascending and inverted      10/15/201412/16/2014Long ETFs
XLPScallop, ascending and inverted      10/16/201412/16/2014Household Products
XLIScallop, ascending and inverted      10/15/201412/17/2014Investment Co. (Domestic)
SPYScallop, ascending and inverted      10/15/201412/16/2014Long ETFs
XLKScallop, ascending and inverted      10/15/201412/16/2014Investment Co. (Domestic)

 

Weekly screen for chart patterns ending between 12/11/2014 and 12/18/2014. Many may be still in development. If no securities appear, then I have not identified any new patterns.

Definitions
RS is relative strength (where 1 is best). For other definitions, see the glossary.
’Breakout is upward/downward 100% of the time’ means price breaks out up/down by definition, not by statistically measuring the rate.
All numbers assume a bull market and are based on the breakout direction that occurs most often.
For more information, consult my book, Encyclopedia of Chart Patterns, Second Edition.
 
Abbott Laboratories (ABT)
Industry: Medical Supplies
Industry RS rank: 3 out of 53
Stock RS rank: 153 out of 588
12/18/14 close: $45.77
1 Month avg volatility: $0.73. Volatility stop (for downward breakout): $47.25 or 3.2% above the close.
Change YTD: 19.41%
Volume: 6,693,400 shares. 3 month avg: 5,218,938 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Broadening top, right-angled and ascending reversal pattern from 10/31/2014 to 12/16/2014
Breakout is downward 66% of the time.
Average decline: 15%.
Break-even failure rate: 20%.
Pullbacks occur 65% of the time.
Price hits measure rule target 32% of the time.

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ADTRAN Inc (ADTN)
Industry: Telecom. Equipment
Industry RS rank: 41 out of 53
Stock RS rank: 335 out of 588
12/18/14 close: $21.84
1 Month avg volatility: $0.64. Volatility stop (for upward breakout): $20.16 or 7.7% below the close.
Change YTD: -19.16%
Volume: 733,700 shares. 3 month avg: 769,029 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 09/12/2014 to 12/17/2014
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Advanced Energy (AEIS)
Industry: Semiconductor
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 15 out of 53
Stock RS rank: 80 out of 588
12/18/14 close: $22.87
1 Month avg volatility: $0.79. Volatility stop (for upward breakout): $20.80 or 9.1% below the close.
Change YTD: 0.04%
Volume: 278,100 shares. 3 month avg: 423,083 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Flag continuation pattern from 12/08/2014 to 12/18/2014
Breakout is upward 54% of the time.
Average rise: 23%.
Break-even failure rate: 4%.
Throwbacks occur 43% of the time.
Price hits measure rule target 64% of the time.

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Alaska Air Group, Inc (ALK)
Industry: Air Transport
Industry RS rank: 2 out of 53
Stock RS rank: 96 out of 588
12/18/14 close: $56.34
1 Month avg volatility: $1.53. Volatility stop (for upward breakout): $52.35 or 7.1% below the close.
Change YTD: 53.58%
Volume: 1,119,800 shares. 3 month avg: 1,573,423 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 11/28/2014 to 12/16/2014
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Ann Inc (ANN)
Industry: Retail (Special Lines)
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 36 out of 53
Stock RS rank: 414 out of 588
12/18/14 close: $38.05
1 Month avg volatility: $1.13. Volatility stop (for upward breakout): $35.63 or 6.4% below the close.
Change YTD: 4.08%
Volume: 505,800 shares. 3 month avg: 677,089 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Pipe bottom reversal pattern from 12/01/2014 to 12/08/2014
Breakout is upward 100% of the time.
Average rise: 45%.
Break-even failure rate: 5%.
Throwbacks occur 44% of the time.
Price hits measure rule target 83% of the time.

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Apogee Enterprises (APOG)
Industry: Building Materials
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 37 out of 53
Stock RS rank: 24 out of 588
12/18/14 close: $43.53
1 Month avg volatility: $1.30. Volatility stop (for upward breakout): $39.64 or 8.9% below the close.
Change YTD: 21.22%
Volume: 501,400 shares. 3 month avg: 212,942 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/10/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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ArcBest Corp (ARCB)
Industry: Trucking/Transp. Leasing
Industry RS rank: 21 out of 53
Stock RS rank: 279 out of 588
12/18/14 close: $44.55
1 Month avg volatility: $1.45. Volatility stop (for downward breakout): $47.78 or 7.2% above the close.
Change YTD: 32.27%
Volume: 189,600 shares. 3 month avg: 394,345 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening top, right-angled and ascending reversal pattern from 11/06/2014 to 12/18/2014
WARNING: A dead-cat bounce occurred on 07/31/2014. There is a 38% chance that a 15% or higher decline will occur (or has occurred since then) by 01/29/2015.
Breakout is downward 66% of the time.
Average decline: 15%.
Break-even failure rate: 20%.
Pullbacks occur 65% of the time.
Price hits measure rule target 32% of the time.

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Archer-Daniels-Midland Co (ADM)
Industry: Food Processing
Industry RS rank: 26 out of 53
Stock RS rank: 136 out of 588
12/18/14 close: $51.16
1 Month avg volatility: $0.98. Volatility stop (for upward breakout): $48.26 or 5.7% below the close.
Change YTD: 17.88%
Volume: 4,824,500 shares. 3 month avg: 3,763,140 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/27/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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BioMarin Pharmaceutical Inc (BMRN)
Industry: Biotechnology
Industry RS rank: 1 out of 53
Stock RS rank: 10 out of 588
12/18/14 close: $91.83
1 Month avg volatility: $3.16. Volatility stop (for downward breakout): $98.16 or 6.9% above the close.
Change YTD: 30.53%
Volume: 1,416,600 shares. 3 month avg: 1,220,102 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening wedge, ascending reversal pattern from 11/03/2014 to 12/17/2014
Breakout is downward 73% of the time.
Average decline: 17%.
Break-even failure rate: 11%.
Pullbacks occur 57% of the time.
Price hits measure rule target 58% of the time.

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Ethan Allen Interiors Inc (ETH)
Industry: Furn/Home Furnishings
Industry RS rank: 19 out of 53
Stock RS rank: 84 out of 588
12/18/14 close: $29.86
1 Month avg volatility: $0.69. Volatility stop (for downward breakout): $31.87 or 6.7% above the close.
Change YTD: -1.84%
Volume: 138,600 shares. 3 month avg: 215,432 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Broadening top reversal pattern from 11/21/2014 to 12/18/2014
Breakout is downward 50% of the time.
Average decline: 15%.
Break-even failure rate: 18%.
Pullbacks occur 48% of the time.
Price hits measure rule target 37% of the time.

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Family Dollar (FDO)
Industry: Retail Store
Industry RS rank: 8 out of 53
Stock RS rank: 121 out of 588
12/18/14 close: $79.46
1 Month avg volatility: $0.61. Volatility stop (for downward breakout): $80.83 or 1.7% above the close.
Change YTD: 22.30%
Volume: 1,150,100 shares. 3 month avg: 1,126,322 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Wednesday.
Warning: the quarterly earnings announcement is due within the next 3 weeks (but verify to be sure), so consider avoiding a trade.
 
Chart pattern: Rising wedge reversal pattern from 10/03/2014 to 12/18/2014
Breakout is downward 69% of the time.
Average decline: 14%.
Break-even failure rate: 24%.
Pullbacks occur 63% of the time.
Price hits measure rule target 46% of the time.

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Fastenal Company (FAST)
Industry: Retail Building Supply
Industry RS rank: 20 out of 53
Stock RS rank: 388 out of 588
12/18/14 close: $46.58
1 Month avg volatility: $0.83. Volatility stop (for downward breakout): $48.24 or 3.6% above the close.
Change YTD: -1.96%
Volume: 1,676,700 shares. 3 month avg: 1,874,512 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening wedge, ascending reversal pattern from 11/12/2014 to 12/17/2014
Breakout is downward 73% of the time.
Average decline: 17%.
Break-even failure rate: 11%.
Pullbacks occur 57% of the time.
Price hits measure rule target 58% of the time.

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Ferro Corp (FOE)
Industry: Chemical (Specialty)
Industry RS rank: 23 out of 53
Stock RS rank: 200 out of 588
12/18/14 close: $13.34
1 Month avg volatility: $0.42. Volatility stop (for upward breakout): $12.30 or 7.8% below the close.
Change YTD: 3.98%
Volume: 356,400 shares. 3 month avg: 506,458 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Rectangle top continuation pattern from 10/20/2014 to 12/18/2014
Breakout is upward 68% of the time.
Average rise: 39%.
Break-even failure rate: 9%.
Throwbacks occur 64% of the time.
Price hits measure rule target 80% of the time.

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Flir Systems Inc (FLIR)
Industry: Aerospace/Defense
Industry RS rank: 12 out of 53
Stock RS rank: 403 out of 588
12/18/14 close: $33.08
1 Month avg volatility: $0.64. Volatility stop (for upward breakout): $31.06 or 6.1% below the close.
Change YTD: 9.90%
Volume: 687,100 shares. 3 month avg: 866,989 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Double Bottom, Adam and Adam reversal pattern from 12/02/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 35%.
Break-even failure rate: 5%.
Throwbacks occur 64% of the time.
Price hits measure rule target 66% of the time.

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General Dynamics Corp (GD)
Industry: Aerospace/Defense
Industry RS rank: 12 out of 53
Stock RS rank: 117 out of 588
12/18/14 close: $139.82
1 Month avg volatility: $1.87. Volatility stop (for upward breakout): $134.98 or 3.5% below the close.
Change YTD: 46.33%
Volume: 3,152,700 shares. 3 month avg: 1,911,800 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Goldman Sachs Group, The (GS)
Industry: Securities Brokerage
Industry RS rank: 7 out of 53
Stock RS rank: 158 out of 588
12/18/14 close: $191.61
1 Month avg volatility: $2.95. Volatility stop (for downward breakout): $197.56 or 3.1% above the close.
Change YTD: 8.10%
Volume: 4,119,700 shares. 3 month avg: 3,137,025 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Monday.
 
Chart pattern: Pipe top reversal pattern from 12/08/2014 to 12/08/2014
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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Harmonic Inc (HLIT)
Industry: Telecom. Equipment
Industry RS rank: 41 out of 53
Stock RS rank: 411 out of 588
12/18/14 close: $6.87
1 Month avg volatility: $0.23. Volatility stop (for downward breakout): $7.36 or 7.2% above the close.
Change YTD: -6.98%
Volume: 533,600 shares. 3 month avg: 637,485 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening top reversal pattern from 11/06/2014 to 12/17/2014
Breakout is downward 50% of the time.
Average decline: 15%.
Break-even failure rate: 18%.
Pullbacks occur 48% of the time.
Price hits measure rule target 37% of the time.

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Harte-Hanks Inc (HHS)
Industry: Advertising
Industry RS rank: 25 out of 53
Stock RS rank: 293 out of 588
12/18/14 close: $7.23
1 Month avg volatility: $0.24. Volatility stop (for downward breakout): $7.93 or 9.6% above the close.
Change YTD: -7.54%
Volume: 225,300 shares. 3 month avg: 206,726 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Rising wedge reversal pattern from 11/13/2014 to 12/18/2014
Breakout is downward 69% of the time.
Average decline: 14%.
Break-even failure rate: 24%.
Pullbacks occur 63% of the time.
Price hits measure rule target 46% of the time.

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Horton, D.R. Inc. (DHI)
Industry: Homebuilding
Industry RS rank: 39 out of 53
Stock RS rank: 278 out of 588
12/18/14 close: $24.47
1 Month avg volatility: $0.56. Volatility stop (for upward breakout): $23.01 or 6.0% below the close.
Change YTD: 9.63%
Volume: 4,035,300 shares. 3 month avg: 5,898,688 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 11/05/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Idex Corp (IEX)
Industry: Machinery
Industry RS rank: 43 out of 53
Stock RS rank: 368 out of 588
12/18/14 close: $76.23
1 Month avg volatility: $1.13. Volatility stop (for upward breakout): $72.90 or 4.4% below the close.
Change YTD: 3.22%
Volume: 345,500 shares. 3 month avg: 442,368 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Intel Corporation (INTC)
Industry: Semiconductor
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 15 out of 53
Stock RS rank: 65 out of 588
12/18/14 close: $37.02
1 Month avg volatility: $0.73. Volatility stop (for upward breakout): $34.97 or 5.6% below the close.
Change YTD: 42.63%
Volume: 32,070,400 shares. 3 month avg: 32,993,206 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 11/12/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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La-Z-Boy Inc (LZB)
Industry: Furn/Home Furnishings
Industry RS rank: 19 out of 53
Stock RS rank: 134 out of 588
12/18/14 close: $26.33
1 Month avg volatility: $0.69. Volatility stop (for downward breakout): $27.87 or 5.9% above the close.
Change YTD: -15.06%
Volume: 285,100 shares. 3 month avg: 360,966 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening top reversal pattern from 11/25/2014 to 12/18/2014
Breakout is downward 50% of the time.
Average decline: 15%.
Break-even failure rate: 18%.
Pullbacks occur 48% of the time.
Price hits measure rule target 37% of the time.

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NetSuite Inc (N)
Industry: E-Commerce
Industry RS rank: 9 out of 53
Stock RS rank: 53 out of 588
12/18/14 close: $107.10
1 Month avg volatility: $3.04. Volatility stop (for upward breakout): $100.07 or 6.6% below the close.
Change YTD: 3.96%
Volume: 426,300 shares. 3 month avg: 485,920 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Broadening bottom reversal pattern from 11/28/2014 to 12/18/2014
Breakout is upward 53% of the time.
Average rise: 27%.
Break-even failure rate: 10%.
Throwbacks occur 41% of the time.
Price hits measure rule target 59% of the time.

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Polyone Corp (POL)
Industry: Chemical (Specialty)
Industry RS rank: 23 out of 53
Stock RS rank: 425 out of 588
12/18/14 close: $36.70
1 Month avg volatility: $0.74. Volatility stop (for upward breakout): $34.47 or 6.1% below the close.
Change YTD: 3.82%
Volume: 513,300 shares. 3 month avg: 843,528 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/13/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Principal Financial Group Inc (PFG)
Industry: Insurance (Diversified)
Industry RS rank: 35 out of 53
Stock RS rank: 271 out of 588
12/18/14 close: $52.26
1 Month avg volatility: $0.95. Volatility stop (for upward breakout): $48.82 or 6.6% below the close.
Change YTD: 5.98%
Volume: 2,237,700 shares. 3 month avg: 1,323,592 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Progressive Corp (PGR)
Industry: Insurance (Prop/Casualty)
Industry RS rank: 18 out of 53
Stock RS rank: 277 out of 588
12/18/14 close: $26.76
1 Month avg volatility: $0.33. Volatility stop (for upward breakout): $25.60 or 4.3% below the close.
Change YTD: -1.87%
Volume: 3,956,800 shares. 3 month avg: 3,274,485 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/16/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Public Service Enterprise Group PEG (PEG)
Industry: Electric Utility (East)
Industry RS rank: 14 out of 53
Stock RS rank: 228 out of 588
12/18/14 close: $42.27
1 Month avg volatility: $0.69. Volatility stop (for upward breakout): $40.30 or 4.7% below the close.
Change YTD: 31.93%
Volume: 3,178,100 shares. 3 month avg: 3,650,860 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 11/14/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Standex International Corp (SXI)
Industry: Diversified Co.
Industry RS rank: 38 out of 53
Stock RS rank: 298 out of 588
12/18/14 close: $76.71
1 Month avg volatility: $2.17. Volatility stop (for upward breakout): $70.08 or 8.7% below the close.
Change YTD: 21.99%
Volume: 36,700 shares. 3 month avg: 52,795 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Head-and-shoulders bottom reversal pattern from 12/02/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 38%.
Break-even failure rate: 3%.
Throwbacks occur 45% of the time.
Price hits measure rule target 74% of the time.

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Thermo Electron Corp (TMO)
Industry: Precision Instrument
Industry RS rank: 28 out of 53
Stock RS rank: 248 out of 588
12/18/14 close: $127.52
1 Month avg volatility: $2.26. Volatility stop (for upward breakout): $120.67 or 5.4% below the close.
Change YTD: 14.52%
Volume: 1,727,400 shares. 3 month avg: 1,916,108 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 11/18/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Tredegar Corp (TG)
Industry: Chemical (Specialty)
Industry RS rank: 23 out of 53
Stock RS rank: 391 out of 588
12/18/14 close: $21.50
1 Month avg volatility: $0.80. Volatility stop (for downward breakout): $23.27 or 8.2% above the close.
Change YTD: -25.37%
Volume: 78,800 shares. 3 month avg: 77,757 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Broadening top, right-angled and ascending reversal pattern from 10/31/2014 to 12/18/2014
Breakout is downward 66% of the time.
Average decline: 15%.
Break-even failure rate: 20%.
Pullbacks occur 65% of the time.
Price hits measure rule target 32% of the time.

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Verisign (VRSN)
Industry: Internet
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 42 out of 53
Stock RS rank: 188 out of 588
12/18/14 close: $57.30
1 Month avg volatility: $0.94. Volatility stop (for upward breakout): $54.79 or 4.4% below the close.
Change YTD: -4.15%
Volume: 1,550,400 shares. 3 month avg: 1,046,729 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/16/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Xilinx Inc (XLNX)
Industry: Semiconductor Cap Equip.
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 24 out of 53
Stock RS rank: 407 out of 588
12/18/14 close: $43.71
1 Month avg volatility: $0.86. Volatility stop (for downward breakout): $45.95 or 5.1% above the close.
Change YTD: -4.81%
Volume: 6,450,800 shares. 3 month avg: 3,925,832 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Pipe top reversal pattern from 12/08/2014 to 12/08/2014
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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iShares Silver Trust (SLV)
Industry: Metals and Mining (Div.)
Industry RS rank: 44 out of 53
Stock RS rank: 497 out of 588
12/18/14 close: $15.25
1 Month avg volatility: $0.33. Volatility stop (for downward breakout): $16.09 or 5.5% above the close.
Change YTD: -18.49%
Volume: 5,949,600 shares. 3 month avg: 9,168,878 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Broadening wedge, ascending reversal pattern from 11/14/2014 to 12/18/2014
Breakout is downward 73% of the time.
Average decline: 17%.
Break-even failure rate: 11%.
Pullbacks occur 57% of the time.
Price hits measure rule target 58% of the time.

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Market Vectors Pharmaceutical (PPH)
Industry: Drug
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 4 out of 53
Stock RS rank: 220 out of 588
12/18/14 close: $65.86
1 Month avg volatility: $0.69. Volatility stop (for upward breakout): $63.15 or 4.1% below the close.
Change YTD: 24.01%
Volume: 88,800 shares. 3 month avg: 100,506 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/16/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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PowerShares QQQ -- Nasdaq 100 (QQQ)
Industry: Long ETFs
Industry RS rank: 10 out of 53
Stock RS rank: 167 out of 588
12/18/14 close: $104.25
1 Month avg volatility: $1.24. Volatility stop (for upward breakout): $100.50 or 3.6% below the close.
Change YTD: 18.52%
Volume: 49,684,700 shares. 3 month avg: 42,466,183 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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S and P Global Tech Sector Index fund (IXN)
Industry: Investment Co. (Foreign)
Industry RS rank: 46 out of 53
Stock RS rank: 234 out of 588
12/18/14 close: $95.72
1 Month avg volatility: $1.05. Volatility stop (for upward breakout): $92.55 or 3.3% below the close.
Change YTD: 14.92%
Volume: 9,000 shares. 3 month avg: 44,818 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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S and P long 2x Ultra SP 500 ProShares (SSO)
Industry: Long ETFs
Industry RS rank: 10 out of 53
Stock RS rank: 179 out of 588
12/18/14 close: $128.79
1 Month avg volatility: $2.46. Volatility stop (for upward breakout): $120.36 or 6.6% below the close.
Change YTD: 25.58%
Volume: 5,208,700 shares. 3 month avg: 5,361,443 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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SPDR Consumer Staples Select Sector (XLP)
Industry: Household Products
Industry RS rank: 31 out of 53
Stock RS rank: 222 out of 588
12/18/14 close: $49.02
1 Month avg volatility: $0.48. Volatility stop (for upward breakout): $47.34 or 3.4% below the close.
Change YTD: 14.05%
Volume: 8,726,300 shares. 3 month avg: 8,909,582 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/16/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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SPDR Industrial Select Sector (XLI)
Industry: Investment Co. (Domestic)
Industry RS rank: 27 out of 53
Stock RS rank: 295 out of 588
12/18/14 close: $56.59
1 Month avg volatility: $0.69. Volatility stop (for upward breakout): $54.39 or 3.9% below the close.
Change YTD: 8.29%
Volume: 14,040,400 shares. 3 month avg: 12,610,563 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/17/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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SPDR S and P 500 (SPY)
Industry: Long ETFs
Industry RS rank: 10 out of 53
Stock RS rank: 262 out of 588
12/18/14 close: $206.78
1 Month avg volatility: $2.29. Volatility stop (for upward breakout): $199.35 or 3.6% below the close.
Change YTD: 11.96%
Volume: 256,998,800 shares. 3 month avg: 135,892,503 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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SPDR Technology Select Sector (XLK)
Industry: Investment Co. (Domestic)
Industry RS rank: 27 out of 53
Stock RS rank: 216 out of 588
12/18/14 close: $41.74
1 Month avg volatility: $0.50. Volatility stop (for upward breakout): $40.18 or 3.7% below the close.
Change YTD: 16.79%
Volume: 10,596,000 shares. 3 month avg: 10,065,262 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/16/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Thursday 12/18/14. Intraday Market Direction: Nasdaq

The index climbed by 2.1% or 96.48 points. Since 02/05/1971 the index made 43 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.9% on 26 occasions.
     Average loss was -1.6% on 17 occasions.
Expect the index to close higher 60.5% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 73/127 or 57.5% of the time.
     The prediction of the index closing lower has been right 26/55 or 47.3% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Nasdaq composite on the 5 minute scale.

$ $ $

I show a picture of the Nasdaq composite on the 5-minute scale.

I drew two red channel lines along the tops and bottoms of today's trading.

I expect the index to trend higher. It may not stay within those lines, but I believe the trend is up. The retrace of the last two weeks or so, is over. I've flipped my bearish targets (except for the transports, which need more time to set a trend) and the chart pattern indicator has turned bullish, too. That could change if the market falters, of course, and a definitive signal isn't solid for up to a week.

Nevertheless, I am hopeful. We could use a Santa rally.

$ $ $

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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© 2014 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  4,509.52    
 Daily S2  4,514.44  4.92   Yes! The Daily S2 is close to the Monthly S2.
 Low  4,550.70  36.26   
 Open  4,556.90  6.20   Yes! The Open is close to the Low.
 Weekly S2  4,557.41  0.51   Yes! The Weekly S2 is close to the Open.
 Monthly S1  4,576.91  19.50   
 Daily S1  4,579.37  2.46   Yes! The Daily S1 is close to the Monthly S1.
 61.8% Down from Intraday High  4,589.36  9.98   Yes! The 61.8% Down from Intraday High is close to the Daily S1.
 Weekly S1  4,600.86  11.50   
 50% Down from Intraday High  4,601.30  0.44   Yes! The 50% Down from Intraday High is close to the Weekly S1.
 38.2% Down from Intraday High  4,613.24  11.94   
 Daily Pivot  4,615.64  2.40   Yes! The Daily Pivot is close to the 38.2% Down from Intraday High.
 Close  4,644.31  28.67   
 High  4,651.90  7.59   Yes! The High is close to the Close.
 Daily R1  4,680.57  28.67   
 Monthly Pivot  4,693.89  13.31   
 Weekly Pivot  4,697.05  3.16   Yes! The Weekly Pivot is close to the Monthly Pivot.
 Daily R2  4,716.84  19.79   
 Weekly R1  4,740.50  23.66   
 Monthly R1  4,761.28  20.78   
 Weekly R2  4,836.69  75.41   
 Monthly R2  4,878.26  41.57   

Wednesday 12/17/14. Chart Pattern Indicator: What's It Say?

Picture of the chart pattern indicator

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

The indicator is still bearish. The index changed from diverging with the indicator to converging with it. In other words, instead of moving up, the index followed the indicator lower.

This chart does not show an end to the downturn, but my portfolio says otherwise. It suggests today's move was narrow, related more to the Dow stocks than the broad market.

Picture of the chart pattern indicator

This is another view of the CPI only it shows signal changes.

The red bars say the indicator is still bearish.

I'm thinking that this downturn is ending. Since I'm often 2 to 3 days too soon in my calls, I expect an upturn by week's end.

-- Thomas Bulkowski

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Tuesday 12/16/14. Dow Approaching Support

The index dropped by -0.6% or -99.99 points. Since 10/01/1928 the index made 641 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.7% on 330 occasions.
     Average loss was -0.7% on 311 occasions.
Expect the index to close higher 51.5% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 86/136 or 63.2% of the time.
     The prediction of the index closing lower has been right 22/41 or 53.7% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Dow industrials on the 5 minute scale.

$ $ $

I show a picture of the Dow industrials on the 5-minute scale.

As I was looking at the figure, I noticed some interesting quirks.

First, the blue lines show the Dow finding support every 200 points. The next support using this method is 17,000.

Second, the two red lines show a support area the Dow found in the closing minutes of Monday's session. Could this mean the index has finally found support strong enough to offer hope of a rebound?

No. I don't trust intraday support or resistance on the 5 minute scale. All of those blue lines were penetrated, after all.

Not shown, but on the daily chart, the Dow is approach underlying support. I expect the index to see support at or near 17,000. My targets (middle, top of page, "Tom's Targets") suggest a drop to 16,900 before a rebound occurs.

$ $ $

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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© 2014 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  16,773.93    
 Weekly S2  16,794.35  20.42   Yes! The Weekly S2 is close to the Monthly S2.
 Daily S2  16,944.96  150.61   
 Monthly S1  16,977.38  32.42   
 Weekly S1  16,987.59  10.21   Yes! The Weekly S1 is close to the Monthly S1.
 Daily S1  17,062.90  75.31   
 Low  17,115.28  52.38   
 Close  17,180.84  65.56   
 61.8% Down from Intraday High  17,225.39  44.55   
 Daily Pivot  17,233.22  7.83   Yes! The Daily Pivot is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  17,259.41  26.19   Yes! The 50% Down from Intraday High is close to the Daily Pivot.
 Open  17,285.74  26.33   Yes! The Open is close to the 50% Down from Intraday High.
 38.2% Down from Intraday High  17,293.42  7.68   Yes! The 38.2% Down from Intraday High is close to the Open.
 Daily R1  17,351.16  57.74   
 High  17,403.54  52.38   
 Weekly Pivot  17,474.08  70.54   
 Monthly Pivot  17,484.29  10.21   Yes! The Monthly Pivot is close to the Weekly Pivot.
 Daily R2  17,521.48  37.19   
 Weekly R1  17,667.32  145.84   
 Monthly R1  17,687.74  20.42   Yes! The Monthly R1 is close to the Weekly R1.
 Weekly R2  18,153.81  466.06   
 Monthly R2  18,194.65  40.84   

Monday 12/15/14. Market Monday: Down then Up

My Prediction

Picture of the Dow utilities on the daily scale.

I show the Dow utility index on the daily chart. It's not really representative of the other indices, though. Nevertheless, here is what I expect to happen with the utilities and the other indices.

First, let's talk about the market in general.

I expect many of them to touch the 38% retrace of the move up from the October low. Then they should rebound going into the new year. Thus, the move will be down then up.

For the utilities, I see a similar move but here it's a drop to the red line before a rebound as shown on this chart.

The red line is below the 38% retrace (which is at the low between the two peaks). So I expect weakness followed by a rebound as that check mark looking thing shows.

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A Brief Look Back

Picture of a flower from my garden.

The following is a brief review of how the markets performed over time. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Down 106.31 points.
Tuesday: Down 51.28 points.
Wednesday: Down 268.05 points.
Thursday: Up 63.19 points.
Friday: Down 315.51 points.

For the Week...

The Dow industrials were down 677.96 points or 3.8%.
The Nasdaq composite was down 127.16 points or 2.7%.
The S&P 500 index was down 73.04 points or 3.5%.

Year to Date...

Dow Industrials
     3.9% down from the high of 17,991.19 on 12/05/2014.
     12.6% up from the low of 15,340.69 on 02/05/2014.
Nasdaq
     3.3% down from the high of 4,810.86 on 11/28/2014.
     17.9% up from the low of 3,946.03 on 04/15/2014.
S&P 500
     3.7% down from the high of 2,079.47 on 12/05/2014.
     15.2% up from the low of 1,737.92 on 02/05/2014.

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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
Industrial production9:15 MB-Production of utilities, mines, and manufacturers.
Capacity utilization9:15 MB-Gauges economic activity, hints of inflation.
Housing starts8:30 TB-Number of homes beginning construction.
Building permits8:30 TB-Measures building permits for new construction.
Consumer price index8:30 WB+Inflation report. Measures cost of goods and services.
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.
Leading indicators10:00 ThD-Summary of already known reports.

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 12/12/2014, the CPI had:

31 bearish patterns,
2 bullish patterns,
104 patterns waiting for breakout.
The CPI signal is 6.1%, 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  17,075  17,178  17,384  17,487  17,693 
Weekly  16,828  17,054  17,507  17,734  18,187 
Monthly  16,807  17,044  17,518  17,754  18,228 
S&P500 (^GSPC): Daily  1,982  1,992  2,012  2,022  2,042 
Weekly  1,953  1,978  2,027  2,051  2,100 
Monthly  1,951  1,977  2,028  2,054  2,105 
Nasdaq (^IXIC): Daily  4,617  4,635  4,672  4,690  4,726 
Weekly  4,561  4,607  4,700  4,747  4,840 
Monthly  4,513  4,583  4,697  4,767  4,881 
  • 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 29.7%   The trend may continue. 
 1 month down 19.2%   Expect a reversal soon. 
 S & P 500 (^GSPC) 1 week down 27.6%   The trend may continue. 
 1 month down 20.2%   Expect a reversal soon. 
 Nasdaq composite (^IXIC) 2 weeks down 18.7%   Expect a reversal soon. 
 1 month down 25.3%   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 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
16Scallop, ascending and inverted
14Flag
10Head-and-shoulders top
9Pipe top
9Diamond top
8Channel
6Triple top
6Double Top, Adam and Adam
5Pipe 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. Biotechnology1. Biotechnology
2. Air Transport2. Air Transport
3. Shoe3. Securities Brokerage
4. Electric Utility (West)4. Shoe
5. Medical Supplies5. Medical Supplies
50. Cement and Aggregates50. Petroleum (Integrated)
51. Petroleum (Integrated)51. Short ETFs
52. Natural Gas (Diversified)52. Natural Gas (Diversified)
53. Oilfield Svcs/Equipment53. Oilfield Svcs/Equipment
54. Petroleum (Producing)54. Petroleum (Producing)

-- Thomas Bulkowski

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Friday 12/12/14. Pattern Trading Setups for the Weekend.

Go to Table.

You can find setups based on a Fibonacci retrace by clicking on the link.

Click the link for a list of symbols from the table.

The following patterns were found manually, so the results may differ from those found using Patternz.

There were 31 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 597 stocks searched, or 5.2%. Based on the percentage, the stock market is trending since few consolidation patterns appear.

Excluding ETFs, there were 7 bullish chart patterns this week and 12 bearish ones with any remaining (7) being undecided. The ratio of bullish to bearish patterns suggests the market is hinting of a coming bearish (down) turn.

In the table below, the red and green colors are based on the historical breakout direction for the associated chart pattern. If a high and tight flag appears, the start and end dates highlight the flagpole only and not the flag.

The following tips may help.

  • Look for patterns with unusual breakout directions, such as an ascending triangle with a downward breakout. The unusual breakout direction can suggest a strong run.
  • Busted patterns, where price breaks out in one direction, turns around and then breaks out in the opposite direction can lead to powerful moves.
  • Throwbacks and pullbacks occur about half the time, so be prepared for a retrace after the breakout.
  • Look for underlying support and overhead resistance to help gauge how far price will move after the breakout.

More...

Good luck. -- Thomas Bulkowski

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
AYIHead-and-shoulders top      11/07/201412/05/2014Furn/Home Furnishings
ADTNTriangle, symmetrical      09/12/201412/11/2014Telecom. Equipment
ALKSChannel      11/07/201412/09/2014Drug
AGNRectangle top      11/17/201412/11/2014Biotechnology
ANIKBroadening top      10/31/201412/11/2014Biotechnology
CDIBroadening top, right-angled and descending      11/13/201412/09/2014Human Resources
CONNDead-cat bounce      12/09/201412/09/2014Retail (Special Lines)
DRIVDead-cat bounce      12/08/201412/08/2014E-Commerce
^DJTDiamond top      11/12/201412/08/2014None
RDENTriangle, descending      11/07/201412/10/2014Toiletries/Cosmetics
EMRHead-and-shoulders top      11/04/201412/05/2014Computers and Peripherals
ELXChannel      11/17/201412/11/2014Computers and Peripherals
EXCHead-and-shoulders bottom      11/14/201412/05/2014Electric Utility (East)
BGCTriangle, symmetrical      10/30/201412/11/2014Computers and Peripherals
GFFBroadening top      11/13/201412/11/2014Building Materials
HONDiamond top      11/21/201412/11/2014Aerospace/Defense
INCYChannel      11/03/201412/11/2014Drug
NSPDouble Top, Eve and Eve      11/10/201412/08/2014Human Resources
KATEPipe top      11/24/201412/01/2014Apparel
NCSChannel      11/03/201412/09/2014Building Materials
OTEXDouble Top, Eve and Eve      11/18/201412/05/2014E-Commerce
RYLHead-and-shoulders top      11/11/201412/10/2014Homebuilding
SCCOHead-and-shoulders top      11/10/201412/05/2014Metals and Mining (Div.)
TOLDouble Top, Adam and Adam      11/24/201412/10/2014Homebuilding
TZOOBroadening wedge, ascending      11/10/201412/10/2014Internet
WWWPipe top      11/24/201412/01/2014Shoe
ITADouble Top, Eve and Eve      11/28/201412/08/2014Aerospace/Defense
ITBFlag      11/24/201412/08/2014Homebuilding
EWYFalling wedge      10/16/201412/11/2014Investment Co. (Foreign)
TURPipe top      11/24/201412/01/2014Long ETFs
PBEChannel      11/06/201412/10/2014Biotechnology

 

Weekly screen for chart patterns ending between 12/04/2014 and 12/11/2014. Many may be still in development. If no securities appear, then I have not identified any new patterns.

Definitions
RS is relative strength (where 1 is best). For other definitions, see the glossary.
’Breakout is upward/downward 100% of the time’ means price breaks out up/down by definition, not by statistically measuring the rate.
All numbers assume a bull market and are based on the breakout direction that occurs most often.
For more information, consult my book, Encyclopedia of Chart Patterns, Second Edition.
 
Acuity Brands, Inc (AYI)
Industry: Furn/Home Furnishings
Industry RS rank: 25 out of 53
Stock RS rank: 317 out of 589
12/11/14 close: $131.75
1 Month avg volatility: $2.52. Volatility stop (for downward breakout): $140.40 or 6.6% above the close.
Change YTD: 20.52%
Volume: 376,300 shares. 3 month avg: 361,640 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Head-and-shoulders top reversal pattern from 11/07/2014 to 12/05/2014
Breakout is downward 100% of the time.
Average decline: 22%.
Break-even failure rate: 4%.
Pullbacks occur 50% of the time.
Price hits measure rule target 55% of the time.

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ADTRAN Inc (ADTN)
Industry: Telecom. Equipment
Industry RS rank: 42 out of 53
Stock RS rank: 379 out of 589
12/11/14 close: $21.01
1 Month avg volatility: $0.65. Volatility stop (for upward breakout): $19.64 or 6.5% below the close.
Change YTD: -22.21%
Volume: 462,800 shares. 3 month avg: 743,505 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 09/12/2014 to 12/11/2014
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Alkermes (ALKS)
Industry: Drug
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 7 out of 53
Stock RS rank: 122 out of 589
12/11/14 close: $55.63
1 Month avg volatility: $1.53. Volatility stop (for upward breakout): $52.47 or 5.7% below the close.
Change YTD: 36.82%
Volume: 581,400 shares. 3 month avg: 894,380 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Channel from 11/07/2014 to 12/09/2014

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Allergan, Inc (AGN)
Industry: Biotechnology
Industry RS rank: 1 out of 53
Stock RS rank: 40 out of 589
12/11/14 close: $211.14
1 Month avg volatility: $3.13. Volatility stop (for upward breakout): $204.07 or 3.4% below the close.
Change YTD: 90.08%
Volume: 3,107,700 shares. 3 month avg: 2,992,406 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Friday.
 
Chart pattern: Rectangle top continuation pattern from 11/17/2014 to 12/11/2014
Breakout is upward 68% of the time.
Average rise: 39%.
Break-even failure rate: 9%.
Throwbacks occur 64% of the time.
Price hits measure rule target 80% of the time.

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Anika Therapeutics Inc (ANIK)
Industry: Biotechnology
Industry RS rank: 1 out of 53
Stock RS rank: 486 out of 589
12/11/14 close: $38.71
1 Month avg volatility: $1.31. Volatility stop (for downward breakout): $42.34 or 9.4% above the close.
Change YTD: 1.44%
Volume: 141,700 shares. 3 month avg: 225,391 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Broadening top reversal pattern from 10/31/2014 to 12/11/2014
Breakout is downward 50% of the time.
Average decline: 15%.
Break-even failure rate: 18%.
Pullbacks occur 48% of the time.
Price hits measure rule target 37% of the time.

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CDI Corp (CDI)
Industry: Human Resources
Industry RS rank: 38 out of 53
Stock RS rank: 101 out of 589
12/11/14 close: $16.90
1 Month avg volatility: $0.51. Volatility stop (for upward breakout): $15.86 or 6.1% below the close.
Change YTD: -8.80%
Volume: 25,500 shares. 3 month avg: 47,200 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Broadening top, right-angled and descending continuation pattern from 11/13/2014 to 12/09/2014
Breakout is upward 51% of the time.
Average rise: 28%.
Break-even failure rate: 19%.
Throwbacks occur 52% of the time.
Price hits measure rule target 63% of the time.

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Conns Inc (CONN)
Industry: Retail (Special Lines)
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 34 out of 53
Stock RS rank: 585 out of 589
12/11/14 close: $17.09
1 Month avg volatility: $1.49. Volatility stop (for upward breakout): $14.03 or 17.9% below the close.
Change YTD: -78.28%
Volume: 2,919,100 shares. 3 month avg: 1,246,625 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Dead-cat bounce from 12/09/2014 to 12/09/2014

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Digital River Inc (DRIV)
Industry: E-Commerce
Industry RS rank: 9 out of 53
Stock RS rank: 198 out of 589
12/11/14 close: $16.58
1 Month avg volatility: $0.75. Volatility stop (for upward breakout): $15.01 or 9.5% below the close.
Change YTD: -10.23%
Volume: 420,900 shares. 3 month avg: 653,828 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Dead-cat bounce from 12/08/2014 to 12/08/2014

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DJ 20 Transportation (^DJT)
Industry: None
Industry RS rank is unavailable.
12/11/14 close: $8,927.05
1 Month avg volatility: $102.27. Volatility stop (for downward breakout): $9,200.73 or 3.1% above the close.
Change YTD: 20.63%
Volume: 15,875,400 shares. 3 month avg: 16,382,025 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Diamond top reversal pattern from 11/12/2014 to 12/08/2014
Breakout is downward 69% of the time.
Average decline: 21%.
Break-even failure rate: 6%.
Pullbacks occur 57% of the time.
Price hits measure rule target 76% of the time.

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Elizabeth Arden Inc (RDEN)
Industry: Toiletries/Cosmetics
Industry RS rank: 45 out of 53
Stock RS rank: 560 out of 589
12/11/14 close: $17.34
1 Month avg volatility: $0.63. Volatility stop (for downward breakout): $18.70 or 7.9% above the close.
Change YTD: -51.09%
Volume: 346,000 shares. 3 month avg: 330,934 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Triangle, descending reversal pattern from 11/07/2014 to 12/10/2014
WARNING: A dead-cat bounce occurred on 08/19/2014. There is a 38% chance that a 15% or higher decline will occur (or has occurred since then) by 02/17/2015.
Breakout is downward 64% of the time.
Average decline: 16%.
Break-even failure rate: 16%.
Pullbacks occur 54% of the time.
Price hits measure rule target 54% of the time.

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Emerson Electric (EMR)
Industry: Computers and Peripherals
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 29 out of 53
Stock RS rank: 412 out of 589
12/11/14 close: $61.32
1 Month avg volatility: $0.93. Volatility stop (for downward breakout): $63.97 or 4.3% above the close.
Change YTD: -12.62%
Volume: 3,627,300 shares. 3 month avg: 3,645,655 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Head-and-shoulders top reversal pattern from 11/04/2014 to 12/05/2014
Breakout is downward 100% of the time.
Average decline: 22%.
Break-even failure rate: 4%.
Pullbacks occur 50% of the time.
Price hits measure rule target 55% of the time.

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Emulex Corp (ELX)
Industry: Computers and Peripherals
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 29 out of 53
Stock RS rank: 327 out of 589
12/11/14 close: $5.32
1 Month avg volatility: $0.17. Volatility stop (for upward breakout): $4.95 or 6.9% below the close.
Change YTD: -25.70%
Volume: 1,139,300 shares. 3 month avg: 1,002,443 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Channel from 11/17/2014 to 12/11/2014

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Exelon Corp. (EXC)
Industry: Electric Utility (East)
Industry RS rank: 8 out of 53
Stock RS rank: 302 out of 589
12/11/14 close: $36.27
1 Month avg volatility: $0.72. Volatility stop (for upward breakout): $34.50 or 4.9% below the close.
Change YTD: 32.42%
Volume: 6,106,100 shares. 3 month avg: 6,549,429 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Head-and-shoulders bottom reversal pattern from 11/14/2014 to 12/05/2014
Breakout is upward 100% of the time.
Average rise: 38%.
Break-even failure rate: 3%.
Throwbacks occur 45% of the time.
Price hits measure rule target 74% of the time.

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General Cable (BGC)
Industry: Computers and Peripherals
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 29 out of 53
Stock RS rank: 574 out of 589
12/11/14 close: $13.68
1 Month avg volatility: $0.58. Volatility stop (for upward breakout): $12.34 or 9.8% below the close.
Change YTD: -53.49%
Volume: 707,800 shares. 3 month avg: 1,124,488 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 10/30/2014 to 12/11/2014
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Griffon Corp (GFF)
Industry: Building Materials
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 37 out of 53
Stock RS rank: 313 out of 589
12/11/14 close: $12.27
1 Month avg volatility: $0.31. Volatility stop (for downward breakout): $13.28 or 8.2% above the close.
Change YTD: -7.12%
Volume: 127,400 shares. 3 month avg: 157,700 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening top reversal pattern from 11/13/2014 to 12/11/2014
Breakout is downward 50% of the time.
Average decline: 15%.
Break-even failure rate: 18%.
Pullbacks occur 48% of the time.
Price hits measure rule target 37% of the time.

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Honeywell International Inc (HON)
Industry: Aerospace/Defense
Industry RS rank: 14 out of 53
Stock RS rank: 284 out of 589
12/11/14 close: $97.89
1 Month avg volatility: $1.01. Volatility stop (for downward breakout): $100.53 or 2.7% above the close.
Change YTD: 7.14%
Volume: 2,213,500 shares. 3 month avg: 3,011,231 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Diamond top reversal pattern from 11/21/2014 to 12/11/2014
Breakout is downward 69% of the time.
Average decline: 21%.
Break-even failure rate: 6%.
Pullbacks occur 57% of the time.
Price hits measure rule target 76% of the time.

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Incyte Corp. (INCY)
Industry: Drug
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 7 out of 53
Stock RS rank: 21 out of 589
12/11/14 close: $75.92
1 Month avg volatility: $2.63. Volatility stop (for upward breakout): $69.98 or 7.8% below the close.
Change YTD: 49.95%
Volume: 1,204,200 shares. 3 month avg: 1,303,091 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Channel from 11/03/2014 to 12/11/2014

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Insperity (NSP)
Industry: Human Resources
Industry RS rank: 38 out of 53
Stock RS rank: 361 out of 589
12/11/14 close: $31.84
1 Month avg volatility: $0.60. Volatility stop (for downward breakout): $33.09 or 3.9% above the close.
Change YTD: -11.87%
Volume: 144,700 shares. 3 month avg: 116,335 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Double Top, Eve and Eve reversal pattern from 11/10/2014 to 12/08/2014
Breakout is downward 100% of the time.
Average decline: 18%.
Break-even failure rate: 11%.
Pullbacks occur 59% of the time.
Price hits measure rule target 73% of the time.

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Kate Spade and Company (KATE)
Industry: Apparel
Industry RS rank: 20 out of 53
Stock RS rank: 504 out of 589
12/11/14 close: $28.90
1 Month avg volatility: $0.88. Volatility stop (for downward breakout): $31.45 or 8.8% above the close.
Change YTD: -9.88%
Volume: 1,125,500 shares. 3 month avg: 2,026,355 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Pipe top reversal pattern from 11/24/2014 to 12/01/2014
WARNING: A dead-cat bounce occurred on 08/12/2014. There is a 38% chance that a 15% or higher decline will occur (or has occurred since then) by 02/10/2015.
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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NCI Building Systems Inc. (NCS)
Industry: Building Materials
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 37 out of 53
Stock RS rank: 267 out of 589
12/11/14 close: $19.17
1 Month avg volatility: $0.62. Volatility stop (for upward breakout): $17.91 or 6.6% below the close.
Change YTD: 9.29%
Volume: 551,600 shares. 3 month avg: 251,385 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Friday.
 
Chart pattern: Channel from 11/03/2014 to 12/09/2014

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Open Text Corp (OTEX)
Industry: E-Commerce
Industry RS rank: 9 out of 53
Stock RS rank: 92 out of 589
12/11/14 close: $57.05
1 Month avg volatility: $1.34. Volatility stop (for downward breakout): $60.66 or 6.3% above the close.
Change YTD: 24.08%
Volume: 183,900 shares. 3 month avg: 279,578 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Double Top, Eve and Eve reversal pattern from 11/18/2014 to 12/05/2014
Breakout is downward 100% of the time.
Average decline: 18%.
Break-even failure rate: 11%.
Pullbacks occur 59% of the time.
Price hits measure rule target 73% of the time.

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Ryland Group, Inc (RYL)
Industry: Homebuilding
Industry RS rank: 39 out of 53
Stock RS rank: 371 out of 589
12/11/14 close: $36.36
1 Month avg volatility: $0.94. Volatility stop (for downward breakout): $38.85 or 6.9% above the close.
Change YTD: -16.24%
Volume: 554,900 shares. 3 month avg: 1,049,426 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Head-and-shoulders top reversal pattern from 11/11/2014 to 12/10/2014
Breakout is downward 100% of the time.
Average decline: 22%.
Break-even failure rate: 4%.
Pullbacks occur 50% of the time.
Price hits measure rule target 55% of the time.

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Southern Copper (SCCO)
Industry: Metals and Mining (Div.)
Industry RS rank: 43 out of 53
Stock RS rank: 339 out of 589
12/11/14 close: $28.52
1 Month avg volatility: $0.71. Volatility stop (for downward breakout): $30.19 or 5.9% above the close.
Change YTD: -0.66%
Volume: 2,902,000 shares. 3 month avg: 1,957,440 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Head-and-shoulders top reversal pattern from 11/10/2014 to 12/05/2014
Breakout is downward 100% of the time.
Average decline: 22%.
Break-even failure rate: 4%.
Pullbacks occur 50% of the time.
Price hits measure rule target 55% of the time.

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Toll Brothers (TOL)
Industry: Homebuilding
Industry RS rank: 39 out of 53
Stock RS rank: 442 out of 589
12/11/14 close: $32.13
1 Month avg volatility: $0.72. Volatility stop (for downward breakout): $34.11 or 6.2% above the close.
Change YTD: -13.16%
Volume: 6,323,800 shares. 3 month avg: 2,698,380 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Double Top, Adam and Adam reversal pattern from 11/24/2014 to 12/10/2014
Breakout is downward 100% of the time.
Average decline: 19%.
Break-even failure rate: 8%.
Pullbacks occur 61% of the time.
Price hits measure rule target 72% of the time.

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Travelzoo Inc. (TZOO)
Industry: Internet
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 41 out of 53
Stock RS rank: 541 out of 589
12/11/14 close: $13.08
1 Month avg volatility: $0.43. Volatility stop (for downward breakout): $14.35 or 9.7% above the close.
Change YTD: -38.65%
Volume: 62,800 shares. 3 month avg: 76,048 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Broadening wedge, ascending reversal pattern from 11/10/2014 to 12/10/2014
Breakout is downward 73% of the time.
Average decline: 17%.
Break-even failure rate: 11%.
Pullbacks occur 57% of the time.
Price hits measure rule target 58% of the time.

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Wolverine World Wide (WWW)
Industry: Shoe
Industry RS rank: 5 out of 53
Stock RS rank: 188 out of 589
12/11/14 close: $29.00
1 Month avg volatility: $0.62. Volatility stop (for downward breakout): $30.84 or 6.3% above the close.
Change YTD: -14.61%
Volume: 594,900 shares. 3 month avg: 720,055 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Monday.
 
Chart pattern: Pipe top reversal pattern from 11/24/2014 to 12/01/2014
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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DJ US Aerospace and defense (ITA)
Industry: Aerospace/Defense
Industry RS rank: 14 out of 53
Stock RS rank: 325 out of 589
12/11/14 close: $111.65
1 Month avg volatility: $1.09. Volatility stop (for downward breakout): $114.88 or 2.9% above the close.
Change YTD: 5.65%
Volume: 20,500 shares. 3 month avg: 38,811 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Double Top, Eve and Eve reversal pattern from 11/28/2014 to 12/08/2014
Breakout is downward 100% of the time.
Average decline: 18%.
Break-even failure rate: 11%.
Pullbacks occur 59% of the time.
Price hits measure rule target 73% of the time.

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DJ US Home construction index fund (ITB)
Industry: Homebuilding
Industry RS rank: 39 out of 53
Stock RS rank: 286 out of 589
12/11/14 close: $24.90
1 Month avg volatility: $0.35. Volatility stop (for upward breakout): $24.14 or 3.1% below the close.
Change YTD: 0.32%
Volume: 1,928,500 shares. 3 month avg: 3,768,911 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Flag continuation pattern from 11/24/2014 to 12/08/2014
Breakout is upward 54% of the time.
Average rise: 23%.
Break-even failure rate: 4%.
Throwbacks occur 43% of the time.
Price hits measure rule target 64% of the time.

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MSCI South Korea Index (EWY)
Industry: Investment Co. (Foreign)
Industry RS rank: 46 out of 53
Stock RS rank: 463 out of 589
12/11/14 close: $55.65
1 Month avg volatility: $0.36. Volatility stop (for upward breakout): $54.74 or 1.6% below the close.
Change YTD: -13.95%
Volume: 3,775,800 shares. 3 month avg: 2,672,434 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Falling wedge from 10/16/2014 to 12/11/2014
Breakout is upward 68% of the time.
Average rise: 32%.
Break-even failure rate: 11%.
Throwbacks occur 56% of the time.
Price hits measure rule target 70% of the time.

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MSCI Turkey Index (TUR)
Industry: Long ETFs
Industry RS rank: 11 out of 53
Stock RS rank: 362 out of 589
12/11/14 close: $54.89
1 Month avg volatility: $0.70. Volatility stop (for downward breakout): $57.32 or 4.4% above the close.
Change YTD: 15.17%
Volume: 149,900 shares. 3 month avg: 345,391 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Pipe top reversal pattern from 11/24/2014 to 12/01/2014
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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PowerShares Dynamic Biotech and Genome (PBE)
Industry: Biotechnology
Industry RS rank: 1 out of 53
Stock RS rank: 113 out of 589
12/11/14 close: $50.96
1 Month avg volatility: $0.78. Volatility stop (for upward breakout): $49.30 or 3.3% below the close.
Change YTD: 37.54%
Volume: 84,200 shares. 3 month avg: 52,095 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Channel from 11/06/2014 to 12/10/2014

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Thursday 12/11/14. Big Down Day. What Now?

The index dropped by -1.7% or -82.44 points. Since 02/05/1971 the index made 74 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 1.3% on 33 occasions.
     Average loss was -1.3% on 41 occasions.
Expect the index to close lower 55.4% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 73/127 or 57.5% of the time.
     The prediction of the index closing lower has been right 26/54 or 48.1% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the S and P 500 index.

$ $ $

I show a picture of the S&P 500 index on the daily chart. This is a change from my normal post due to the big down day we had today (Wednesday). I thought you would be interested in a wider perspective.

The above probabilities say that the index (Nasdaq) is going to close lower tomorrow since that is what has happened in the past. Let's assume it's correct or even if we get a rebound tomorrow, how far might the index (S&P) drop in the coming days?

I show two red lines on the chart. They are loosely aligned with the peaks and valleys or prior price action. It is my belief that the index will drop to A and stop within those two bands. This is just a guess, of course, because no one really knows.

I don't view this as the start of a bear market. The economy is doing too well for that to happen.

Still, this is the retrace I've been waiting for. I don't really believe the excuse that lower energy prices have pushed the market down. I just think it was time for a retrace.

The market might surprise us and rebound tomorrow. I just get a sense that there is underlying strength. The big boys wanted to shake out the raw meat and now it's time for a renewed push up. But that remains to be seen. As they say, buy the dips.

$ $ $

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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© 2014 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  4,480.66    
 Monthly S1  4,582.35  101.68   
 Daily S2  4,622.57  40.22   
 Daily S1  4,653.30  30.73   
 Weekly S2  4,668.18  14.88   
 Weekly S1  4,676.11  7.92   Yes! The Weekly S1 is close to the Weekly S2.
 Low  4,679.24  3.13   Yes! The Low is close to the Weekly S1.
 Close  4,684.03  4.79   Yes! The Close is close to the Low.
 Monthly Pivot  4,696.60  12.57   
 Daily Pivot  4,709.97  13.37   
 61.8% Down from Intraday High  4,712.63  2.66   Yes! The 61.8% Down from Intraday High is close to the Daily Pivot.
 50% Down from Intraday High  4,722.94  10.31   
 Weekly Pivot  4,732.54  9.60   
 38.2% Down from Intraday High  4,733.25  0.71   Yes! The 38.2% Down from Intraday High is close to the Weekly Pivot.
 Weekly R1  4,740.47  7.21   Yes! The Weekly R1 is close to the 38.2% Down from Intraday High.
 Daily R1  4,740.70  0.23   Yes! The Daily R1 is close to the Weekly R1.
 Open  4,754.42  13.72   
 High  4,766.64  12.22   
 Weekly R2  4,796.90  30.26   
 Daily R2  4,797.37  0.47   Yes! The Daily R2 is close to the Weekly R2.
 Monthly R1  4,798.29  0.92   Yes! The Monthly R1 is close to the Daily R2.
 Monthly R2  4,912.54  114.26   

Wednesday 12/10/14. Chart Pattern Indicator: The Neutral Zone

Picture of the chart pattern indicator

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

The chart shows the indicator sloping downward even as the index climbed, a classic sign of divergence.

The drop in the indicator suggests that we are going down, but when? The May to July period provides a template for what I expect. The strength in the other indices today may power the markets higher for a time, but the day will come when the markets will retrace like they did in July. For now, though, there is no telling when that might be.

Picture of the chart pattern indicator

This is another view of the CPI only it shows signal changes.

Notice that the indicator is solidly in neutral territory. While we could have more bullish green stripes, the white banding suggests a coming drop in the index.

-- Thomas Bulkowski

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Tuesday 12/9/14. Dow: Ascending Broadening Wedge, Down Breakout. Whatsup?

The index dropped by -0.6% or -106.31 points. Since 10/01/1928 the index made 640 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.7% on 330 occasions.
     Average loss was -0.7% on 310 occasions.
Expect the index to close higher 51.6% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 86/135 or 63.7% of the time.
     The prediction of the index closing lower has been right 22/41 or 53.7% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Dow industrials on the 5 minute scale.

$ $ $

I show a picture of the Dow industrials on the 5-minute scale.

The index has made an ascending broadening wedge outlined here in red. The index punched through the bottom trendline, staging a downward breakout. Is this typical?

Yes. Statistics for the pattern show that they breakout downward 73% of the time.

The index has pulled back to the bottom of the pattern. Stats for pullbacks says price continues its upward run 53% of the time. With energy prices powering the economy, maybe this breakout is fake.

An interesting development is that the chart pattern indicator has also turned bearish today. That could change tomorrow, but could this be the retrace I've been waiting for? Maybe so. On the longer-term chart (not shown), you can see the index rolling over and moving at a more shallow angle than it did during the October rise. The angle now is more sustainable, but the index still needs to take a rest.

The above probabilities suggest a higher close on Tuesday.

$ $ $

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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© 2014 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  16,994.51    
 Monthly S1  17,423.50  428.98   
 Weekly S2  17,592.10  168.60   
 Monthly Pivot  17,707.34  115.24   
 Daily S2  17,716.16  8.82   Yes! The Daily S2 is close to the Monthly Pivot.
 Weekly S1  17,722.29  6.13   Yes! The Weekly S1 is close to the Daily S2.
 Daily S1  17,784.32  62.03   
 Low  17,804.28  19.96   
 Close  17,852.48  48.20   
 Weekly Pivot  17,856.74  4.26   Yes! The Weekly Pivot is close to the Close.
 61.8% Down from Intraday High  17,863.98  7.24   Yes! The 61.8% Down from Intraday High is close to the Weekly Pivot.
 Daily Pivot  17,872.44  8.46   Yes! The Daily Pivot is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  17,882.42  9.98   Yes! The 50% Down from Intraday High is close to the Daily Pivot.
 38.2% Down from Intraday High  17,900.86  18.44   
 Daily R1  17,940.60  39.74   
 Open  17,954.94  14.34   Yes! The Open is close to the Daily R1.
 High  17,960.56  5.62   Yes! The High is close to the Open.
 Weekly R1  17,986.93  26.37   
 Daily R2  18,028.72  41.79   
 Weekly R2  18,121.38  92.66   
 Monthly R1  18,136.33  14.95   Yes! The Monthly R1 is close to the Weekly R2.
 Monthly R2  18,420.17  283.85   

Monday 12/8/14. Pullback Done in S&P. Time for Up.

My Prediction

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

This is a picture of the S&P 500 index on the daily scale.

Not much has changed since I looked at the index a few weeks ago. A broadening top appears outlined in red.

Since then, the index has broken out upward, pulled back to the price of the top of the broadening top, and now appears to be moving higher.

My belief is that the index will continue moving up in the coming days and weeks. After all, this is December, the best performing month of the year

 

 

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A Brief Look Back

Picture of a flower from my garden.

The following is a brief review of how the markets performed over time. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Down 51.44 points.
Tuesday: Up 102.75 points.
Wednesday: Up 33.07 points.
Thursday: Down 12.52 points.
Friday: Up 58.69 points.

For the Week...

The Dow industrials were up 130.55 points or 0.7%.
The Nasdaq composite was down 10.87 points or 0.2%.
The S&P 500 index was up 7.81 points or 0.4%.

Year to Date...

Dow Industrials
     0.2% down from the high of 17,991.19 on 12/05/2014.
     17.1% up from the low of 15,340.69 on 02/05/2014.
Nasdaq
     0.6% down from the high of 4,810.86 on 11/28/2014.
     21.2% up from the low of 3,946.03 on 04/15/2014.
S&P 500
     0.2% down from the high of 2,079.47 on 12/05/2014.
     19.4% up from the low of 1,737.92 on 02/05/2014.

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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 TuD-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 12/05/2014, the CPI had:

11 bearish patterns,
22 bullish patterns,
203 patterns waiting for breakout.
The CPI signal is 66.7%, 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  17,863  17,911  17,951  17,999  18,039 
Weekly  17,628  17,793  17,892  18,058  18,157 
Monthly  17,030  17,494  17,743  18,207  18,456 
S&P500 (^GSPC): Daily  2,067  2,071  2,075  2,080  2,084 
Weekly  2,038  2,057  2,068  2,087  2,098 
Monthly  1,973  2,024  2,052  2,103  2,130 
Nasdaq (^IXIC): Daily  4,760  4,771  4,780  4,790  4,799 
Weekly  4,700  4,741  4,765  4,805  4,829 
Monthly  4,513  4,647  4,729  4,863  4,945 
  • 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) 7 weeks up 4.2%   Expect a reversal soon. 
 3 months up 28.5%   The trend may continue. 
 S & P 500 (^GSPC) 7 weeks up 1.4%   Expect a reversal soon. 
 3 months up 36.2%   The trend may continue. 
 Nasdaq composite (^IXIC) 1 week down 30.3%   The trend may continue. 
 1 month down 25.3%   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 over.

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

 Found Chart Pattern Name
24Flag
22Triangle, symmetrical
16Scallop, ascending and inverted
9Pennant
7Diamond top
5Triple top
5Double Top, Adam and Adam
5Pipe bottom
5Dead-cat bounce
5Pipe 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. Biotechnology1. Biotechnology
2. Air Transport2. Shoe
3. Securities Brokerage3. E-Commerce
4. Shoe4. Air Transport
5. Medical Supplies5. Medical Supplies
50. Petroleum (Integrated)50. Petroleum (Integrated)
51. Short ETFs51. Natural Gas (Diversified)
52. Natural Gas (Diversified)52. Short ETFs
53. Oilfield Svcs/Equipment53. Oilfield Svcs/Equipment
54. Petroleum (Producing)54. Petroleum (Producing)

-- Thomas Bulkowski

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Friday 12/5/14. Pattern Trading Setups for the Weekend.

Go to Table.

You can find setups based on a Fibonacci retrace by clicking on the link.

Click the link for a list of symbols from the table.

The following patterns were found manually, so the results may differ from those found using Patternz.

There were 29 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 600 stocks searched, or 4.8%. Based on the percentage, the stock market is trending since few consolidation patterns appear.

Excluding ETFs, there were 11 bullish chart patterns this week and 11 bearish ones with any remaining (6) being undecided. The ratio of bullish to bearish patterns suggests the market is hinting of a coming bearish (down) turn.

In the table below, the red and green colors are based on the historical breakout direction for the associated chart pattern. If a high and tight flag appears, the start and end dates highlight the flagpole only and not the flag.

The following tips may help.

  • Look for patterns with unusual breakout directions, such as an ascending triangle with a downward breakout. The unusual breakout direction can suggest a strong run.
  • Busted patterns, where price breaks out in one direction, turns around and then breaks out in the opposite direction can lead to powerful moves.
  • Throwbacks and pullbacks occur about half the time, so be prepared for a retrace after the breakout.
  • Look for underlying support and overhead resistance to help gauge how far price will move after the breakout.

More...

Good luck. -- Thomas Bulkowski

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
ACXMChannel      10/31/201412/02/2014Computer Software and Svcs
ASNABroadening top, right-angled and ascending      10/21/201412/04/2014Apparel
BBBYPennant      11/24/201412/04/2014Retail (Special Lines)
BMYChannel      11/06/201412/04/2014Drug
CBKDead-cat bounce      12/04/201412/04/2014Retail (Special Lines)
CLRDead-cat bounce      11/28/201411/28/2014Petroleum (Producing)
DTVRectangle top      11/03/201412/02/2014Telecom. Equipment
DTriangle, symmetrical      11/10/201412/04/2014Electric Utility (East)
EMCTriangle, symmetrical      11/18/201412/04/2014Computers and Peripherals
FFIVBroadening wedge, ascending      11/04/201412/04/2014Internet
FETriangle, symmetrical      11/11/201412/04/2014Electric Utility (East)
FISVChannel      10/31/201412/04/2014Computer Software and Svcs
HAYNBroadening top      10/29/201412/01/2014Building Materials
IBKRTriangle, ascending      11/07/201412/04/2014Securities Brokerage
LAWSTriangle, symmetrical      11/12/201412/03/2014Metal Fabricating
LXUPipe top      11/17/201411/24/2014Building Materials
MANBroadening wedge, ascending      10/28/201412/03/2014Human Resources
MLMPipe top      11/17/201411/24/2014Cement and Aggregates
MTSNRectangle top      11/03/201412/04/2014Semiconductor Cap Equip.
MSScallop, ascending and inverted      10/15/201412/01/2014Securities Brokerage
NWYPipe top      11/17/201411/24/2014Apparel
OGEScallop, ascending and inverted      10/15/201412/01/2014Electric Utility (Central)
OXMTriple top      11/13/201411/28/2014Apparel
KWRDouble Bottom, Adam and Adam      11/19/201412/01/2014Chemical (Specialty)
SPFDiamond bottom      09/25/201411/28/2014Homebuilding
TPXTriangle, symmetrical      09/09/201412/02/2014Furn/Home Furnishings
TERRising wedge      10/08/201411/28/2014Semiconductor Cap Equip.
VMCPipe top      11/17/201411/24/2014Cement and Aggregates
IATBroadening wedge, descending      11/12/201412/04/2014Long ETFs

 

Weekly screen for chart patterns ending between 11/27/2014 and 12/04/2014. Many may be still in development. If no securities appear, then I have not identified any new patterns.

Definitions
RS is relative strength (where 1 is best). For other definitions, see the glossary.
’Breakout is upward/downward 100% of the time’ means price breaks out up/down by definition, not by statistically measuring the rate.
All numbers assume a bull market and are based on the breakout direction that occurs most often.
For more information, consult my book, Encyclopedia of Chart Patterns, Second Edition.
 
Acxiom Corp (ACXM)
Industry: Computer Software and Svcs
Industry RS rank: 14 out of 53
Stock RS rank: 470 out of 592
12/4/14 close: $19.75
1 Month avg volatility: $0.61. Volatility stop (for upward breakout): $18.36 or 7.1% below the close.
Change YTD: -46.59%
Volume: 650,800 shares. 3 month avg: 524,318 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Channel from 10/31/2014 to 12/02/2014

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Ascena Retail Group (ASNA)
Industry: Apparel
Industry RS rank: 17 out of 53
Stock RS rank: 539 out of 592
12/4/14 close: $12.20
1 Month avg volatility: $0.44. Volatility stop (for downward breakout): $13.13 or 7.6% above the close.
Change YTD: -42.34%
Volume: 2,715,600 shares. 3 month avg: 2,002,651 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Broadening top, right-angled and ascending reversal pattern from 10/21/2014 to 12/04/2014
Breakout is downward 66% of the time.
Average decline: 15%.
Break-even failure rate: 20%.
Pullbacks occur 65% of the time.
Price hits measure rule target 32% of the time.

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Bed Bath and Beyond (BBBY)
Industry: Retail (Special Lines)
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 27 out of 53
Stock RS rank: 110 out of 592
12/4/14 close: $72.66
1 Month avg volatility: $1.12. Volatility stop (for upward breakout): $70.22 or 3.4% below the close.
Change YTD: -9.51%
Volume: 1,853,400 shares. 3 month avg: 2,696,835 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Pennant continuation pattern from 11/24/2014 to 12/04/2014
Breakout is upward 61% of the time.
Average rise: 25%.
Break-even failure rate: 2%.
Throwbacks occur 47% of the time.
Price hits measure rule target 60% of the time.

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Bristol-Myers Squibb Company (BMY)
Industry: Drug
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 6 out of 53
Stock RS rank: 74 out of 592
12/4/14 close: $58.89
1 Month avg volatility: $0.80. Volatility stop (for upward breakout): $57.01 or 3.2% below the close.
Change YTD: 10.80%
Volume: 4,427,200 shares. 3 month avg: 6,580,069 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Channel from 11/06/2014 to 12/04/2014

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Christopher and Banks Corp (CBK)
Industry: Retail (Special Lines)
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 27 out of 53
Stock RS rank: 535 out of 592
12/4/14 close: $4.95
1 Month avg volatility: $0.38. Volatility stop (for upward breakout): $4.09 or 17.3% below the close.
Change YTD: -42.04%
Volume: 2,619,200 shares. 3 month avg: 414,051 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Dead-cat bounce from 12/04/2014 to 12/04/2014

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Continental Resources Inc. (CLR)
Industry: Petroleum (Producing)
Industry RS rank: 53 out of 53
Stock RS rank: 581 out of 592
12/4/14 close: $38.86
1 Month avg volatility: $2.54. Volatility stop (for upward breakout): $33.28 or 14.4% below the close.
Change YTD: -30.93%
Volume: 4,217,700 shares. 3 month avg: 3,127,677 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Dead-cat bounce from 11/28/2014 to 11/28/2014

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DirecTV Group Inc. (DTV)
Industry: Telecom. Equipment
Industry RS rank: 39 out of 53
Stock RS rank: 317 out of 592
12/4/14 close: $85.23
1 Month avg volatility: $0.77. Volatility stop (for upward breakout): $83.53 or 2.0% below the close.
Change YTD: 23.41%
Volume: 3,296,100 shares. 3 month avg: 2,795,203 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Rectangle top continuation pattern from 11/03/2014 to 12/02/2014
Breakout is upward 68% of the time.
Average rise: 39%.
Break-even failure rate: 9%.
Throwbacks occur 64% of the time.
Price hits measure rule target 80% of the time.

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Dominion Resources Inc. (D)
Industry: Electric Utility (East)
Industry RS rank: 19 out of 53
Stock RS rank: 308 out of 592
12/4/14 close: $72.74
1 Month avg volatility: $1.06. Volatility stop (for upward breakout): $70.04 or 3.7% below the close.
Change YTD: 12.44%
Volume: 1,735,800 shares. 3 month avg: 2,618,291 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Friday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 11/10/2014 to 12/04/2014
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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EMC Corporation (EMC)
Industry: Computers and Peripherals
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 26 out of 53
Stock RS rank: 156 out of 592
12/4/14 close: $30.32
1 Month avg volatility: $0.42. Volatility stop (for upward breakout): $29.26 or 3.5% below the close.
Change YTD: 20.56%
Volume: 9,328,500 shares. 3 month avg: 15,158,135 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 11/18/2014 to 12/04/2014
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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F5 Networks, Inc. (FFIV)
Industry: Internet
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 42 out of 53
Stock RS rank: 89 out of 592
12/4/14 close: $132.31
1 Month avg volatility: $2.27. Volatility stop (for downward breakout): $137.11 or 3.6% above the close.
Change YTD: 45.62%
Volume: 721,800 shares. 3 month avg: 1,003,398 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Broadening wedge, ascending reversal pattern from 11/04/2014 to 12/04/2014
Breakout is downward 73% of the time.
Average decline: 17%.
Break-even failure rate: 11%.
Pullbacks occur 57% of the time.
Price hits measure rule target 58% of the time.

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FirstEnergy Corp. (FE)
Industry: Electric Utility (East)
Industry RS rank: 19 out of 53
Stock RS rank: 262 out of 592
12/4/14 close: $36.95
1 Month avg volatility: $0.61. Volatility stop (for upward breakout): $35.52 or 3.9% below the close.
Change YTD: 12.04%
Volume: 2,618,100 shares. 3 month avg: 3,033,215 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 11/11/2014 to 12/04/2014
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Fiserv, Inc (FISV)
Industry: Computer Software and Svcs
Industry RS rank: 14 out of 53
Stock RS rank: 138 out of 592
12/4/14 close: $70.90
1 Month avg volatility: $0.69. Volatility stop (for upward breakout): $69.37 or 2.2% below the close.
Change YTD: 20.07%
Volume: 1,253,100 shares. 3 month avg: 1,111,592 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Channel from 10/31/2014 to 12/04/2014

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Haynes International Inc. (HAYN)
Industry: Building Materials
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 25 out of 53
Stock RS rank: 468 out of 592
12/4/14 close: $47.45
1 Month avg volatility: $1.70. Volatility stop (for downward breakout): $51.52 or 8.6% above the close.
Change YTD: -14.10%
Volume: 29,000 shares. 3 month avg: 43,583 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Broadening top reversal pattern from 10/29/2014 to 12/01/2014
Breakout is downward 50% of the time.
Average decline: 15%.
Break-even failure rate: 18%.
Pullbacks occur 48% of the time.
Price hits measure rule target 37% of the time.

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Interactive Brokers Group Inc (IBKR)
Industry: Securities Brokerage
Industry RS rank: 7 out of 53
Stock RS rank: 120 out of 592
12/4/14 close: $27.53
1 Month avg volatility: $0.45. Volatility stop (for upward breakout): $26.53 or 3.6% below the close.
Change YTD: 13.11%
Volume: 374,200 shares. 3 month avg: 502,263 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Triangle, ascending reversal pattern from 11/07/2014 to 12/04/2014
Breakout is upward 70% of the time.
Average rise: 35%.
Break-even failure rate: 13%.
Throwbacks occur 57% of the time.
Price hits measure rule target 75% of the time.

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Lawson Products (LAWS)
Industry: Metal Fabricating
Industry RS rank: 48 out of 53
Stock RS rank: 13 out of 592
12/4/14 close: $22.88
1 Month avg volatility: $0.72. Volatility stop (for upward breakout): $21.32 or 6.8% below the close.
Change YTD: 86.78%
Volume: 6,300 shares. 3 month avg: 26,038 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 11/12/2014 to 12/03/2014
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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LSB Industries Inc (LXU)
Industry: Building Materials
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 25 out of 53
Stock RS rank: 511 out of 592
12/4/14 close: $31.32
1 Month avg volatility: $1.25. Volatility stop (for downward breakout): $34.54 or 10.3% above the close.
Change YTD: -23.65%
Volume: 158,200 shares. 3 month avg: 159,418 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Pipe top reversal pattern from 11/17/2014 to 11/24/2014
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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Manpower Inc. (MAN)
Industry: Human Resources
Industry RS rank: 37 out of 53
Stock RS rank: 502 out of 592
12/4/14 close: $69.30
1 Month avg volatility: $1.22. Volatility stop (for downward breakout): $72.05 or 4.0% above the close.
Change YTD: -19.29%
Volume: 998,900 shares. 3 month avg: 888,643 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Broadening wedge, ascending reversal pattern from 10/28/2014 to 12/03/2014
Breakout is downward 73% of the time.
Average decline: 17%.
Break-even failure rate: 11%.
Pullbacks occur 57% of the time.
Price hits measure rule target 58% of the time.

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Martin Marietta Materials, Inc (MLM)
Industry: Cement and Aggregates
Industry RS rank: 44 out of 53
Stock RS rank: 386 out of 592
12/4/14 close: $119.60
1 Month avg volatility: $2.70. Volatility stop (for downward breakout): $126.39 or 5.7% above the close.
Change YTD: 19.67%
Volume: 434,400 shares. 3 month avg: 932,314 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Pipe top reversal pattern from 11/17/2014 to 11/24/2014
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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Mattson Technology Inc. (MTSN)
Industry: Semiconductor Cap Equip.
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 13 out of 53
Stock RS rank: 44 out of 592
12/4/14 close: $2.68
1 Month avg volatility: $0.10. Volatility stop (for upward breakout): $2.44 or 8.8% below the close.
Change YTD: -2.19%
Volume: 158,300 shares. 3 month avg: 379,828 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Rectangle top continuation pattern from 11/03/2014 to 12/04/2014
Breakout is upward 68% of the time.
Average rise: 39%.
Break-even failure rate: 9%.
Throwbacks occur 64% of the time.
Price hits measure rule target 80% of the time.

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Morgan Stanley (MS)
Industry: Securities Brokerage
Industry RS rank: 7 out of 53
Stock RS rank: 121 out of 592
12/4/14 close: $36.79
1 Month avg volatility: $0.47. Volatility stop (for upward breakout): $35.30 or 4.1% below the close.
Change YTD: 17.32%
Volume: 9,216,400 shares. 3 month avg: 10,102,217 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/01/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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New York and Company Inc (NWY)
Industry: Apparel
Industry RS rank: 17 out of 53
Stock RS rank: 568 out of 592
12/4/14 close: $2.53
1 Month avg volatility: $0.13. Volatility stop (for downward breakout): $2.92 or 15.3% above the close.
Change YTD: -42.11%
Volume: 337,200 shares. 3 month avg: 198,258 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Pipe top reversal pattern from 11/17/2014 to 11/24/2014
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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OGE Energy Corp (OGE)
Industry: Electric Utility (Central)
Industry RS rank: 20 out of 53
Stock RS rank: 393 out of 592
12/4/14 close: $35.42
1 Month avg volatility: $0.57. Volatility stop (for upward breakout): $34.17 or 3.5% below the close.
Change YTD: 4.48%
Volume: 1,099,500 shares. 3 month avg: 1,167,542 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 10/15/2014 to 12/01/2014
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Oxford Industries (OXM)
Industry: Apparel
Industry RS rank: 17 out of 53
Stock RS rank: 397 out of 592
12/4/14 close: $63.90
1 Month avg volatility: $1.24. Volatility stop (for downward breakout): $68.07 or 6.5% above the close.
Change YTD: -20.79%
Volume: 124,000 shares. 3 month avg: 83,615 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Triple top reversal pattern from 11/13/2014 to 11/28/2014
Breakout is downward 100% of the time.
Average decline: 19%.
Break-even failure rate: 10%.
Pullbacks occur 61% of the time.
Price hits measure rule target 40% of the time.

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Quaker Chemical (KWR)
Industry: Chemical (Specialty)
Industry RS rank: 29 out of 53
Stock RS rank: 128 out of 592
12/4/14 close: $84.24
1 Month avg volatility: $1.83. Volatility stop (for upward breakout): $79.94 or 5.1% below the close.
Change YTD: 9.30%
Volume: 42,500 shares. 3 month avg: 47,480 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Monday.
 
Chart pattern: Double Bottom, Adam and Adam reversal pattern from 11/19/2014 to 12/01/2014
Breakout is upward 100% of the time.
Average rise: 35%.
Break-even failure rate: 5%.
Throwbacks occur 64% of the time.
Price hits measure rule target 66% of the time.

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Standard Pacific (SPF)
Industry: Homebuilding
Industry RS rank: 38 out of 53
Stock RS rank: 466 out of 592
12/4/14 close: $7.18
1 Month avg volatility: $0.19. Volatility stop (for upward breakout): $6.77 or 5.8% below the close.
Change YTD: -20.66%
Volume: 2,601,400 shares. 3 month avg: 2,953,626 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Diamond bottom reversal pattern from 09/25/2014 to 11/28/2014
Breakout is upward 69% of the time.
Average rise: 36%.
Break-even failure rate: 4%.
Throwbacks occur 53% of the time.
Price hits measure rule target 81% of the time.

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Tempur-pedic Intl (TPX)
Industry: Furn/Home Furnishings
Industry RS rank: 15 out of 53
Stock RS rank: 410 out of 592
12/4/14 close: $54.83
1 Month avg volatility: $1.09. Volatility stop (for upward breakout): $51.93 or 5.3% below the close.
Change YTD: 1.61%
Volume: 684,200 shares. 3 month avg: 828,808 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 09/09/2014 to 12/02/2014
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Teradyne Inc. (TER)
Industry: Semiconductor Cap Equip.
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 13 out of 53
Stock RS rank: 242 out of 592
12/4/14 close: $20.00
1 Month avg volatility: $0.39. Volatility stop (for downward breakout): $20.99 or 5.0% above the close.
Change YTD: 13.51%
Volume: 1,777,500 shares. 3 month avg: 2,781,646 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Rising wedge reversal pattern from 10/08/2014 to 11/28/2014
Breakout is downward 69% of the time.
Average decline: 14%.
Break-even failure rate: 24%.
Pullbacks occur 63% of the time.
Price hits measure rule target 46% of the time.

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Vulcan Materials (VMC)
Industry: Cement and Aggregates
Industry RS rank: 44 out of 53
Stock RS rank: 224 out of 592
12/4/14 close: $67.42
1 Month avg volatility: $1.25. Volatility stop (for downward breakout): $70.21 or 4.1% above the close.
Change YTD: 13.46%
Volume: 1,067,700 shares. 3 month avg: 1,192,292 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Pipe top reversal pattern from 11/17/2014 to 11/24/2014
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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iShares DJ US Regional Banks (IAT)
Industry: Long ETFs
Industry RS rank: 10 out of 53
Stock RS rank: 330 out of 592
12/4/14 close: $34.32
1 Month avg volatility: $0.32. Volatility stop (for upward breakout): $33.45 or 2.5% below the close.
Change YTD: 3.81%
Volume: 53,400 shares. 3 month avg: 175,428 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Broadening wedge, descending reversal pattern from 11/12/2014 to 12/04/2014
Breakout is upward 79% of the time.
Average rise: 33%.
Break-even failure rate: 6%.
Throwbacks occur 53% of the time.
Price hits measure rule target 79% of the time.

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Thursday 12/4/14. Nasdaq: Steady as She Goes!

The index climbed by 0.4% or 18.66 points. Since 02/05/1971 the index made 539 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.8% on 343 occasions.
     Average loss was -0.7% on 196 occasions.
Expect the index to close higher 63.6% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 73/126 or 57.9% of the time.
     The prediction of the index closing lower has been right 26/54 or 48.1% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Nasdaq composite on the 5 minute scale.

$ $ $

I show a picture of the Nasdaq composite on the 5-minute scale.

I drew two nearly parallel red lines bounding price action. I expect this type of up trend to continue but world events may cause the channel to jump up or down.

You can see one channel (chart left until this past Friday) bump down on Friday and Monday before a new channel formed. Maybe that will happen again. As for now, my crystal ball agrees with the above probabilities that Thursday will close higher.

$ $ $

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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© 2014 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  4,312.05    
 Monthly S1  4,543.26  231.21   
 Monthly Pivot  4,677.06  133.80   
 Weekly S2  4,682.41  5.35   
 Weekly S1  4,728.44  46.03   
 Daily S2  4,730.76  2.32   Yes! The Daily S2 is close to the Weekly S1.
 Low  4,745.14  14.38   
 Daily S1  4,752.62  7.48   
 61.8% Down from Intraday High  4,758.98  6.36   
 Open  4,761.31  2.33   Yes! The Open is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  4,763.25  1.94   Yes! The 50% Down from Intraday High is close to the Open.
 Daily Pivot  4,766.99  3.74   
 38.2% Down from Intraday High  4,767.53  0.54   Yes! The 38.2% Down from Intraday High is close to the Daily Pivot.
 Weekly Pivot  4,769.65  2.12   Yes! The Weekly Pivot is close to the 38.2% Down from Intraday High.
 Close  4,774.47  4.82   
 High  4,781.37  6.90   
 Daily R1  4,788.85  7.48   
 Daily R2  4,803.22  14.38   
 Weekly R1  4,815.68  12.46   
 Weekly R2  4,856.89  41.21   
 Monthly R1  4,908.27  51.38   
 Monthly R2  5,042.07  133.80   

Wednesday 12/3/14. Chart Pattern Indicator: What's It Say?

Picture of the chart pattern indicator

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

Although it is difficult to see on this chart, today's move up was less helpful to portfolios than was the pain inflicted by yesterday's plunge. The indicator dipped into bearish territory but has now recovered into the neutral zone.

Picture of the chart pattern indicator

This is another view of the CPI only it shows signal changes.

You can see the signal change from bullish (green) to neutral (white) to bearish (red).

If the index continues to climb then the red bar will disappear. That can happen for up to a week, so be patient. Of course, a turn down will strengthen the bearish signal. Often after three trading days, the signal is often unlikely to change. However, any unusual move in the index (a large rise or decline) can sway the indicator.

Right now, though, the indicator is bearish on the market.

-- Thomas Bulkowski

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Tuesday 12/2/14. Intraday Market Direction: Dow

The index dropped by -0.3% or -51.44 points. Since 10/01/1928 the index made 983 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.6% on 467 occasions.
     Average loss was -0.7% on 516 occasions.
Expect the index to close lower 52.5% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 86/135 or 63.7% of the time.
     The prediction of the index closing lower has been right 22/40 or 55.0% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Dow industrials on the 5 minute scale.

$ $ $

I show a picture of the Dow industrials on the 5-minute scale.

I have highlighted a rectangle top using two red lines. I could have drawn them closer together during the Monday to Wednesday period, but chose this configuration. At A, the index pierced the lower trendline. Then the index pulled back and now rests slightly below the line.

What does this mean? I can only speculate, but I believe it shows weakness. In fact, if you look at the chart pattern indicator (CPI) at the top of this page, it has flipped to bearish as of Monday's close. It might flip back to neutral or even bullish after the close on Tuesday, but for right now, it's bearish.

All of this spells weakness for the indices.

$ $ $

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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© 2014 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  16,195.34    
 Monthly S1  16,986.07  790.73   
 Monthly Pivot  17,440.45  454.38   
 Daily S2  17,676.15  235.70   
 Weekly S2  17,717.84  41.69   
 Daily S1  17,726.48  8.64   Yes! The Daily S1 is close to the Weekly S2.
 Low  17,726.55  0.07   Yes! The Low is close to the Daily S1.
 Weekly S1  17,747.32  20.77   
 61.8% Down from Intraday High  17,765.03  17.71   
 Close  17,776.80  11.78   
 Daily Pivot  17,776.87  0.07   Yes! The Daily Pivot is close to the Close.
 50% Down from Intraday High  17,776.91  0.04   Yes! The 50% Down from Intraday High is close to the Daily Pivot.
 38.2% Down from Intraday High  17,788.79  11.88   
 Weekly Pivot  17,820.37  31.57   
 Daily R1  17,827.20  6.83   Yes! The Daily R1 is close to the Weekly Pivot.
 Open  17,827.27  0.07   Yes! The Open is close to the Daily R1.
 High  17,827.27  0.00   Yes! The High is close to the Open.
 Weekly R1  17,849.85  22.58   
 Daily R2  17,877.59  27.74   
 Weekly R2  17,922.90  45.31   
 Monthly R1  18,231.18  308.28   
 Monthly R2  18,685.56  454.38   

Monday 12/1/14. Market Monday: The Week Ahead

My Prediction

Picture of the Nasdaq on the daily scale.

I show a picture of the Nasdaq composite on the daily scale.

I highlighted two areas of support. The first area peaks in September at A.

The second is the small knot of congestion at B. Both A and B I expect will help support the composite should it begin to retrace the move up from the low in October.

I have been expecting such a retrace but the market has shown strength. Now, I expect the uphill run to continue. In other indices, I think the move over the next two weeks will be a strong one.

Sometimes, you find a congestion region (an area where the index or stock pauses) midway through the uphill or downhill run. That is what creates a measured move up chart pattern. The B area might be such a pause, although it is too short to be proportional to the long move up. Even so, if it is the mid point, then we have a ways to go before the run ends. (I don't think it's a mid point. Rather, I think this leg of the move will be shorter.)

Whether any of this plays out is a guess, so we will have to see. The bottom line is I'm looking for a continuation of the upward move this week.

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A Brief Look Back

Picture of a flower from my garden.

The following is a brief review of how the markets performed over time. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Up 7.84 points.
Tuesday: Down 2.96 points.
Wednesday: Up 12.81 points.
Friday: Up 0.49 points.
Saturday: Holiday or other weird event!

For the Week...

The Dow industrials were up 18.18 points or 0.1%.
The Nasdaq composite was up 78.66 points or 1.7%.
The S&P 500 index was up 4.06 points or 0.2%.

Year to Date...

Dow Industrials
     0.4% down from the high of 17,894.83 on 11/21/2014.
     16.2% up from the low of 15,340.69 on 02/05/2014.
Nasdaq
     0.4% down from the high of 4,810.86 on 11/28/2014.
     21.4% up from the low of 3,946.03 on 04/15/2014.
S&P 500
     0.4% down from the high of 2,075.76 on 11/28/2014.
     19.0% up from the low of 1,737.92 on 02/05/2014.

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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 TDCovers residential/non-residential/public spending on new construction.
Auto & truck sales2:00 TC-Monthly sales of domestically produced vehicles.
Productivity & costs8:30 WD+Cost of producing a unit of output.
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.
4 Employment reports8:30 FANonfarm payrolls, unemployment rate, avg workweek, hourly earnings.
Trade balance8:30 FC+Signals balance of exports & imports.
Factory orders10:00 FD+Durable/non-durable goods orders w/factory inventories.
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 11/28/2014, the CPI had:

28 bearish patterns,
57 bullish patterns,
290 patterns waiting for breakout.
The CPI signal is 67.1%, 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  17,758  17,793  17,843  17,879  17,929 
Weekly  17,735  17,782  17,838  17,884  17,940 
Monthly  16,212  17,020  17,458  18,265  18,703 
S&P500 (^GSPC): Daily  2,059  2,063  2,069  2,074  2,080 
Weekly  2,058  2,063  2,069  2,074  2,080 
Monthly  1,900  1,984  2,030  2,113  2,159 
Nasdaq (^IXIC): Daily  4,772  4,782  4,796  4,806  4,821 
Weekly  4,688  4,740  4,775  4,827  4,863 
Monthly  4,318  4,555  4,683  4,920  5,048 
  • 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) 6 weeks up 5.4%   Expect a reversal soon. 
 2 months up 40.2%   Expect a random direction. 
 S & P 500 (^GSPC) 6 weeks up 5.1%   Expect a reversal soon. 
 2 months up 42.1%   Expect a random direction. 
 Nasdaq composite (^IXIC) 6 weeks up 5.4%   Expect a reversal soon. 
 2 months up 40.5%   Expect a random direction. 

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
27Flag
15Triangle, symmetrical
14Scallop, ascending and inverted
12Pennant
7Diamond top
5Pipe bottom
5Broadening top
3Head-and-shoulders bottom
3Dead-cat bounce
3Double Top, Adam 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. Biotechnology1. Biotechnology
2. Shoe2. E-Commerce
3. E-Commerce3. Shoe
4. Air Transport4. Medical Supplies
5. Medical Supplies5. Air Transport
50. Petroleum (Integrated)50. Natural Gas (Diversified)
51. Natural Gas (Diversified)51. Toiletries/Cosmetics
52. Short ETFs52. Petroleum (Producing)
53. Oilfield Svcs/Equipment53. Oilfield Svcs/Equipment
54. Petroleum (Producing)54. Short ETFs

-- Thomas Bulkowski

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