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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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740 or 685 by 08/01/2017
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January 2016 Headlines


Archives


Friday 1/29/16. 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 16 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 647 stocks searched, or 2.5%. Based on the percentage, the stock market is trending since few consolidation patterns appear.

I found 8 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 15 bullish chart patterns this week and 7 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.

More...

-- Thomas Bulkowski. Donate now to keep this website free.

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
ADSDead-cat bounce      01/28/201601/28/2016Information Services
AEPBroadening top      12/31/201501/28/2016Electric Utility (Central)
ANTMDouble Top, Eve and Adam      12/30/201501/25/2016Medical Services
BECNPipe bottom      01/11/201601/19/2016Retail Building Supply
BBWBroadening bottom      12/10/201501/22/2016Retail (Special Lines)
CBKFlag, high and tight      12/15/201501/25/2016Retail (Special Lines)
CSGSBroadening bottom      11/30/201501/26/2016IT Services
FETriangle, symmetrical      11/25/201501/28/2016Electric Utility (East)
FDPTriangle, symmetrical      12/23/201501/28/2016Food Processing
GLFPipe bottom      01/11/201601/19/2016Oilfield Svcs/Equipment
HELETriangle, descending      01/14/201601/28/2016Toiletries/Cosmetics
ICONPipe bottom      01/11/201601/19/2016Shoe
ISRGBroadening top      12/29/201501/28/2016Medical Supplies
NVTATriangle, descending      09/29/201501/28/2016Medical Services
LGHead-and-shoulders bottom      01/04/201601/22/2016Natural Gas (Distributor)
MWPipe bottom      01/11/201601/19/2016Retail (Special Lines)
SAIAPipe bottom      01/11/201601/19/2016Trucking/Transp. Leasing
SEICDead-cat bounce      01/27/201601/28/2016IT Services
NOWDead-cat bounce      01/27/201601/27/2016IT Services
SCCOPipe bottom      01/11/201601/19/2016Metals and Mining (Div.)
SWNFlag, high and tight      12/17/201501/28/2016Natural Gas (Diversified)
TGDiamond bottom      01/11/201601/28/2016Chemical (Specialty)
VFCPipe bottom      01/11/201601/19/2016Apparel
WERNPipe bottom      01/11/201601/19/2016Trucking/Transp. Leasing

 

Weekly screen for chart patterns ending between 01/21/2016 and 01/28/2016. 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.
 
Alliance Data Systems Corp (ADS)
Industry: Information Services
Industry RS rank: 40 out of 56
Stock RS rank: 473 out of 640
1/28/16 close: $199.00
1 Month avg volatility: $8.02. Volatility stop (for downward breakout): $247.44 or 24.3% above the close.
Change YTD: -28.05%
Volume: 3,380,900 shares. 3 month avg: 471,586 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 continuation pattern from 01/28/2016 to 01/28/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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American Electric Power AEP (AEP)
Industry: Electric Utility (Central)
Industry RS rank: 2 out of 56
Stock RS rank: 75 out of 640
1/28/16 close: $59.45
1 Month avg volatility: $1.18. Volatility stop (for downward breakout): $62.21 or 4.6% above the close.
Change YTD: 2.03%
Volume: 4,541,800 shares. 3 month avg: 3,254,491 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: Broadening top reversal pattern from 12/31/2015 to 01/28/2016
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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Anthem (ANTM)
Industry: Medical Services
Industry RS rank: 39 out of 56
Stock RS rank: 370 out of 640
1/28/16 close: $126.42
1 Month avg volatility: $3.94. Volatility stop (for downward breakout): $140.95 or 11.5% above the close.
Change YTD: -9.34%
Volume: 3,195,500 shares. 3 month avg: 2,110,286 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: Double Top, Eve and Adam reversal pattern from 12/30/2015 to 01/25/2016
Breakout is downward 100% of the time.
Average decline: 15%.
Break-even failure rate: 13%.
Pullbacks occur 64% of the time.
Price hits measure rule target 72% of the time.

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Beacon Roofing Supply Inc. (BECN)
Industry: Retail Building Supply
Industry RS rank: 14 out of 56
Stock RS rank: 30 out of 640
1/28/16 close: $39.54
1 Month avg volatility: $1.06. Volatility stop (for upward breakout): $37.24 or 5.8% below the close.
Change YTD: -3.98%
Volume: 302,800 shares. 3 month avg: 466,334 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 bottom reversal pattern from 01/11/2016 to 01/19/2016
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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Build-A-Bear Workshop Inc (BBW)
Industry: Retail (Special Lines)
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 56 out of 56
Stock RS rank: 489 out of 640
1/28/16 close: $12.45
1 Month avg volatility: $0.62. Volatility stop (for upward breakout): $10.99 or 11.7% below the close.
Change YTD: 1.72%
Volume: 118,900 shares. 3 month avg: 304,408 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 12/10/2015 to 01/22/2016
WARNING: A dead-cat bounce occurred on 10/29/2015. There is a 38% chance that a 15% or higher decline will occur (or has occurred since then) by 04/28/2016.
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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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: 56 out of 56
Stock RS rank: 596 out of 640
1/28/16 close: $1.69
1 Month avg volatility: $0.15. Volatility stop (for upward breakout): $1.25 or 26.1% below the close.
Change YTD: 2.42%
Volume: 356,400 shares. 3 month avg: 479,100 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, high and tight continuation pattern from 12/15/2015 to 01/25/2016
WARNING: A dead-cat bounce occurred on 08/14/2015. There is a 38% chance that a 15% or higher decline will occur (or has occurred since then) by 02/12/2016.
Breakout is upward 100% of the time.
Average rise: 69%.
Throwbacks occur 54% of the time.
Price hits measure rule target 90% of the time.

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CSG Systems International Inc (CSGS)
Industry: IT Services
Industry RS rank: 10 out of 56
Stock RS rank: 37 out of 640
1/28/16 close: $34.84
1 Month avg volatility: $1.10. Volatility stop (for upward breakout): $32.10 or 7.9% below the close.
Change YTD: -3.17%
Volume: 164,900 shares. 3 month avg: 260,729 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 bottom reversal pattern from 11/30/2015 to 01/26/2016
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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FirstEnergy Corp. (FE)
Industry: Electric Utility (East)
Industry RS rank: 5 out of 56
Stock RS rank: 143 out of 640
1/28/16 close: $32.14
1 Month avg volatility: $0.81. Volatility stop (for upward breakout): $30.17 or 6.1% below the close.
Change YTD: 1.29%
Volume: 4,022,000 shares. 3 month avg: 4,270,551 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: Triangle, symmetrical continuation pattern from 11/25/2015 to 01/28/2016
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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Fresh Del Monte Produce (FDP)
Industry: Food Processing
Industry RS rank: 13 out of 56
Stock RS rank: 142 out of 640
1/28/16 close: $39.48
1 Month avg volatility: $0.79. Volatility stop (for upward breakout): $37.80 or 4.3% below the close.
Change YTD: 1.54%
Volume: 132,900 shares. 3 month avg: 185,846 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 12/23/2015 to 01/28/2016
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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Gulfmark Offshore Inc (GLF)
Industry: Oilfield Svcs/Equipment
Industry RS rank: 45 out of 56
Stock RS rank: 630 out of 640
1/28/16 close: $3.61
1 Month avg volatility: $0.33. Volatility stop (for upward breakout): $2.82 or 21.8% below the close.
Change YTD: -22.70%
Volume: 487,400 shares. 3 month avg: 596,034 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 bottom reversal pattern from 01/11/2016 to 01/19/2016
WARNING: A dead-cat bounce occurred on 11/10/2015. There is a 26% chance that a 15% or higher decline will occur (or has occurred since then) by 02/09/2016 and a 38% chance by 05/10/2016.
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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Helen of Troy Ltd (HELE)
Industry: Toiletries/Cosmetics
Industry RS rank: 20 out of 56
Stock RS rank: 126 out of 640
1/28/16 close: $86.31
1 Month avg volatility: $3.01. Volatility stop (for downward breakout): $92.94 or 7.7% above the close.
Change YTD: -8.42%
Volume: 208,200 shares. 3 month avg: 301,123 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 01/14/2016 to 01/28/2016
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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Iconix Brand Group Inc. (ICON)
Industry: Shoe
Industry RS rank: 55 out of 56
Stock RS rank: 632 out of 640
1/28/16 close: $6.31
1 Month avg volatility: $0.56. Volatility stop (for upward breakout): $5.00 or 20.8% below the close.
Change YTD: -7.61%
Volume: 1,026,400 shares. 3 month avg: 3,085,954 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 bottom reversal pattern from 01/11/2016 to 01/19/2016
WARNING: A dead-cat bounce occurred on 12/28/2015. There is a 26% chance that a 15% or higher decline will occur (or has occurred since then) by 03/28/2016 and a 38% chance by 06/27/2016.
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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Intuitive Surgical Inc. (ISRG)
Industry: Medical Supplies
Industry RS rank: 15 out of 56
Stock RS rank: 154 out of 640
1/28/16 close: $526.59
1 Month avg volatility: $14.84. Volatility stop (for downward breakout): $568.54 or 8.0% above the close.
Change YTD: -3.58%
Volume: 441,700 shares. 3 month avg: 350,092 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 top reversal pattern from 12/29/2015 to 01/28/2016
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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Invitae Corp (NVTA)
Industry: Medical Services
Industry RS rank: 39 out of 56
Stock RS rank: 525 out of 640
1/28/16 close: $6.76
1 Month avg volatility: $0.63. Volatility stop (for downward breakout): $8.53 or 26.2% above the close.
Change YTD: -17.66%
Volume: 296,900 shares. 3 month avg: 150,251 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Triangle, descending reversal pattern from 09/29/2015 to 01/28/2016
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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Laclede Group (LG)
Industry: Natural Gas (Distributor)
Industry RS rank: 21 out of 56
Stock RS rank: 27 out of 640
1/28/16 close: $61.91
1 Month avg volatility: $1.15. Volatility stop (for upward breakout): $57.97 or 6.4% below the close.
Change YTD: 4.21%
Volume: 308,500 shares. 3 month avg: 235,658 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: Head-and-shoulders bottom reversal pattern from 01/04/2016 to 01/22/2016
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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Mens Warehouse (MW)
Industry: Retail (Special Lines)
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 56 out of 56
Stock RS rank: 636 out of 640
1/28/16 close: $13.14
1 Month avg volatility: $0.83. Volatility stop (for upward breakout): $11.21 or 14.7% below the close.
Change YTD: -10.49%
Volume: 2,297,300 shares. 3 month avg: 2,577,000 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: Pipe bottom reversal pattern from 01/11/2016 to 01/19/2016
WARNING: A dead-cat bounce occurred on 12/10/2015. There is a 26% chance that a 15% or higher decline will occur (or has occurred since then) by 03/10/2016 and a 38% chance by 06/09/2016.
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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SAIA Inc (SAIA)
Industry: Trucking/Transp. Leasing
Industry RS rank: 52 out of 56
Stock RS rank: 607 out of 640
1/28/16 close: $20.85
1 Month avg volatility: $1.07. Volatility stop (for upward breakout): $18.22 or 12.6% below the close.
Change YTD: -6.29%
Volume: 190,700 shares. 3 month avg: 263,432 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 bottom reversal pattern from 01/11/2016 to 01/19/2016
WARNING: A dead-cat bounce occurred on 10/29/2015. There is a 38% chance that a 15% or higher decline will occur (or has occurred since then) by 04/28/2016.
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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SEI Investments Co (SEIC)
Industry: IT Services
Industry RS rank: 10 out of 56
Stock RS rank: 481 out of 640
1/28/16 close: $37.32
1 Month avg volatility: $1.80. Volatility stop (for downward breakout): $42.72 or 14.5% above the close.
Change YTD: -28.78%
Volume: 4,140,200 shares. 3 month avg: 828,065 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 continuation pattern from 01/27/2016 to 01/28/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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ServiceNow Inc (NOW)
Industry: IT Services
Industry RS rank: 10 out of 56
Stock RS rank: 382 out of 640
1/28/16 close: $63.57
1 Month avg volatility: $2.83. Volatility stop (for downward breakout): $70.04 or 10.2% above the close.
Change YTD: -26.56%
Volume: 19,775,100 shares. 3 month avg: 1,729,562 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Dead-cat bounce continuation pattern from 01/27/2016 to 01/27/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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Southern Copper (SCCO)
Industry: Metals and Mining (Div.)
Industry RS rank: 25 out of 56
Stock RS rank: 256 out of 640
1/28/16 close: $24.98
1 Month avg volatility: $0.80. Volatility stop (for upward breakout): $22.97 or 8.0% below the close.
Change YTD: -4.36%
Volume: 1,101,300 shares. 3 month avg: 1,639,455 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 bottom reversal pattern from 01/11/2016 to 01/19/2016
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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Southwestern Energy Company (SWN)
Industry: Natural Gas (Diversified)
Industry RS rank: 38 out of 56
Stock RS rank: 616 out of 640
1/28/16 close: $8.54
1 Month avg volatility: $0.80. Volatility stop (for upward breakout): $6.80 or 20.4% below the close.
Change YTD: 20.11%
Volume: 14,844,200 shares. 3 month avg: 19,182,531 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: Flag, high and tight continuation pattern from 12/17/2015 to 01/28/2016
Breakout is upward 100% of the time.
Average rise: 69%.
Throwbacks occur 54% of the time.
Price hits measure rule target 90% of the time.

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Tredegar Corp (TG)
Industry: Chemical (Specialty)
Industry RS rank: 16 out of 56
Stock RS rank: 563 out of 640
1/28/16 close: $12.21
1 Month avg volatility: $0.61. Volatility stop (for upward breakout): $10.89 or 10.8% below the close.
Change YTD: -10.35%
Volume: 46,400 shares. 3 month avg: 92,985 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: Diamond bottom reversal pattern from 01/11/2016 to 01/28/2016
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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V. F. Corp (VFC)
Industry: Apparel
Industry RS rank: 23 out of 56
Stock RS rank: 419 out of 640
1/28/16 close: $60.07
1 Month avg volatility: $1.46. Volatility stop (for upward breakout): $56.31 or 6.3% below the close.
Change YTD: -3.50%
Volume: 2,837,900 shares. 3 month avg: 3,062,698 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 bottom reversal pattern from 01/11/2016 to 01/19/2016
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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Werner Enterprises, Inc (WERN)
Industry: Trucking/Transp. Leasing
Industry RS rank: 52 out of 56
Stock RS rank: 385 out of 640
1/28/16 close: $22.82
1 Month avg volatility: $0.93. Volatility stop (for upward breakout): $20.50 or 10.2% below the close.
Change YTD: -2.44%
Volume: 685,500 shares. 3 month avg: 740,532 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 bottom reversal pattern from 01/11/2016 to 01/19/2016
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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Thursday 1/28/16. Intraday Market Direction: Nasdaq

The index dropped by -2.2% or -99.5 points. Since 02/05/1971 the index made 44 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 1.0% on 18 occasions.
     Average loss was -1.8% on 26 occasions.
Expect the index to close lower 59.1% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 98/168 or 58.3% of the time.
     The prediction of the index closing lower has been right 34/71 or 47.9% 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 a horizontal red line connecting the recent rounding top chart pattern at A and B.

This chart pattern is a repeat of Tuesday's blog post. With that rounding turn, it broke out downward, not upward as I had hoped. Will this do the same and breakout downward?

The above probabilities suggest the answer is yes, at least it will close lower on Thursday.

I think the index is resting on support, so I'm inclined to believe we'll see 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 Nasdaq composite, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski. Donate now to keep this website free.

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© 2016 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  3,829.25    
 Monthly S1  4,148.71  319.46   
 Weekly S2  4,179.79  31.08   
 Weekly S1  4,323.98  144.19   
 Daily S2  4,377.93  53.95   
 Daily S1  4,423.05  45.12   
 Low  4,450.83  27.78   
 Weekly Pivot  4,457.58  6.75   Yes! The Weekly Pivot is close to the Low.
 Close  4,468.17  10.59   Yes! The Close is close to the Weekly Pivot.
 61.8% Down from Intraday High  4,495.91  27.74   
 Daily Pivot  4,495.95  0.04   Yes! The Daily Pivot is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  4,509.84  13.89   
 38.2% Down from Intraday High  4,523.77  13.93   
 Daily R1  4,541.07  17.30   
 Open  4,548.87  7.80   Yes! The Open is close to the Daily R1.
 High  4,568.85  19.98   
 Weekly R1  4,601.77  32.92   
 Daily R2  4,613.97  12.20   
 Monthly Pivot  4,632.85  18.88   
 Weekly R2  4,735.37  102.52   
 Monthly R1  4,952.31  216.94   
 Monthly R2  5,436.45  484.14   

Wednesday 1/27/16. A Look At Indicators

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 near or at the top of the scale, saying it is wildly bullish. But that only means there is one way to go: Down.

Although the signal can change for up to seven days, usually it is solid after three. Thus, I think that maybe, just maybe, the indices have hit bottom and are now moving up.

That could change if the price oil sinks again, which it will, or China burps, which it is likely to do. Thus, the ride up is likely to be a bumpy one.

Picture of the percent down indicators

The red line is the percentage of stocks at least 20% below their 1-year high (plotted upside down). The blue line is the average percentage drop of stocks below their 1-year high (plotted upside down).

Notice that the red line has bounced off its low. The blue line seems to be turning up, too. Both are bullish.

Shown as a red line on the above chart...
On Monday, 66% of stocks in my database are in bear market territory (down at least 20% from their 1-year high).
A week ago, it was 65%.
The fewest was 20% on 04/15/2015.
And the most was 68% on 01/20/2016.
Shown as a blue line on the above chart...
The 545 stocks in my database are down an average of 31% from their yearly high.
A week ago, the average was 30%.
The peak was 12% on 02/24/2015.
And the bottom was 31% on 01/20/2016.

-- Thomas Bulkowski. Donate now to keep this website free.

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Tuesday 1/26/16. Intraday Market Direction: Dow

The index dropped by -1.3% or -208.29 points. Since 10/01/1928 the index made 206 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 1.0% on 106 occasions.
     Average loss was -0.8% on 100 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 108/179 or 60.3% of the time.
     The prediction of the index closing lower has been right 28/54 or 51.9% 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 chart shows a rounded top chart pattern, from the low on Wednesday to today (Monday).

I get the feeling that the index will decline some, perhaps as far as the launch price, A.

However, my guess is that the index won't decline that far. Rather, it'll find support sooner, perhaps at the red line (B) or the green line (C). Those two levels would correspond to a Fibonacci retracement. I didn't draw the lines at a Fib retrace of 50%, 38%, or 62%. I just drew them from the left, at support, to the right.

The chart pattern indicator has flipped to bearish from bullish with today's move lower. So that's a negative, suggesting a drop.

Today's reversal is what I feared would happen after I looked at Friday's results. Too many of the stocks opened high but closed lower, suggesting today's downturn. Of course, by then it was too late to flip my bullish predictions in Tom's Target. Still, there is time for the market to get its act together and rescue me by making a strong push upward.

$ $ $

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. Donate now to keep this website free.

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© 2016 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  14,062.47    
 Monthly S1  14,973.85  911.37   
 Weekly S2  15,114.51  140.67   
 Weekly S1  15,499.87  385.35   
 Daily S2  15,744.30  244.43   
 Daily S1  15,814.76  70.46   
 Weekly Pivot  15,835.91  21.15   
 Low  15,880.15  44.24   
 Close  15,885.22  5.07   Yes! The Close is close to the Low.
 Daily Pivot  15,950.61  65.39   
 61.8% Down from Intraday High  15,958.96  8.35   Yes! The 61.8% Down from Intraday High is close to the Daily Pivot.
 50% Down from Intraday High  15,983.30  24.34   
 38.2% Down from Intraday High  16,007.65  24.34   
 Daily R1  16,021.07  13.42   Yes! The Daily R1 is close to the 38.2% Down from Intraday High.
 High  16,086.46  65.39   
 Open  16,086.46  0.00   Yes! The Open is close to the High.
 Daily R2  16,156.92  70.46   
 Weekly R1  16,221.27  64.35   
 Monthly Pivot  16,361.93  140.67   
 Weekly R2  16,557.31  195.38   
 Monthly R1  17,273.31  715.99   
 Monthly R2  18,661.39  1,388.09   

Monday 1/25/16. Market Monday: The Week Ahead

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.

A three falling peaks chart pattern appears at ABC. It confirms as a valid chart pattern when the index closes below the horizontal green line at D.

The index has made a V-bottom. I show that as the red V-shaped lines.

I thought that this v-turn marked the bottom of the downtrend and that a new uptrend has begun. But after reviewing some of the stocks I bought this morning, I'm not so sure. Many of them closed below their opening prices. They jumped up higher at the opening bell but fell back. It suggests weakness not reflected in the indices.

So even though I flipped the targets on Tom's Targets at the top of this page, the downturn may not be over.

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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.

Tuesday: Up 27.94 points.
Wednesday: Down 249.28 points.
Thursday: Up 115.94 points.
Friday: Up 210.83 points.
Saturday: Holiday or other weird event!

For the Week...

The Dow industrials were up 105.43 points or 0.7%.
The Nasdaq composite was up 102.76 points or 2.3%.
The S&P 500 index was up 26.57 points or 1.4%.

Year to Date...

Dow Industrials
     7.5% down from the high of 17,405.48 on 01/04/2016.
     4.2% up from the low of 15,450.56 on 01/20/2016.
Nasdaq
     6.8% down from the high of 4,926.73 on 01/05/2016.
     6.4% up from the low of 4,313.39 on 01/20/2016.
S&P 500
     6.4% down from the high of 2,038.20 on 01/04/2016.
     5.2% up from the low of 1,812.29 on 01/20/2016.

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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
Consumer confidence10:00 TB-Surveys 5,000 households for trends.
New home sales10:00 WC+Shows sales of single-family homes.
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.
Durable goods orders8:30 ThBMeasures orders, shipments of goods with lifespans >3 years.
Gross domestic product8:30 FBMeasures economic activity; GDP deflator measures inflation.
Chicago purchasing managers index9:45 FBMonitors regional manufacturing activity.
Michigan sentiment10:00 FB-Consumer sentiment: Measures strength of consumer spending.

Options Expiration

No options expire this week.

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Swing and Position Traders: Chart Pattern Indicator

As of 01/22/2016, the CPI had:

0 bearish patterns,
22 bullish patterns,
339 patterns waiting for breakout.
The CPI signal is 100.0%, which is bullish (>= 65%).

The chart pattern indicator is bullish with 2 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  15,835  15,964  16,050  16,180  16,266 
Weekly  15,184  15,639  15,905  16,360  16,627 
Monthly  14,132  15,113  16,431  17,412  18,731 
S&P500 (^GSPC): Daily  1,866  1,887  1,898  1,918  1,929 
Weekly  1,779  1,843  1,876  1,940  1,973 
Monthly  1,664  1,786  1,934  2,055  2,203 
Nasdaq (^IXIC): Daily  4,523  4,557  4,574  4,608  4,625 
Weekly  4,221  4,406  4,499  4,684  4,776 
Monthly  3,870  4,231  4,674  5,034  5,477 
  • 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 41.7%   Expect a random direction. 
 2 months down 10.3%   Expect a reversal soon. 
 S & P 500 (^GSPC) 1 week up 40.8%   Expect a random direction. 
 2 months down 10.0%   Expect a reversal soon. 
 Nasdaq composite (^IXIC) 1 week up 43.6%   Expect a random direction. 
 2 months down 15.0%   Expect a reversal soon. 

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

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

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

Buy-and-Hold: 12-Month SMA

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

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Earnings, Chart Patterns & Industries

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

 Found Chart Pattern Name
26Head-and-shoulders top
12Pipe top
10Double Top, Adam and Adam
10Dead-cat bounce
8Triple top
7Triangle, symmetrical
6Broadening top
4Double Top, Eve and Eve
3Rectangle bottom
3Double Bottom, Eve and Adam

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

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

 

 

 

 

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

This WeekLast Week
1. Short ETFs1. Internet
2. Electric Utility (Central)2. Short ETFs
3. Electric Utility (West)3. Electric Utility (West)
4. Electric Utility (East)4. Electric Utility (Central)
5. Semiconductor Cap Equip.5. Household Products
50. Biotechnology50. Homebuilding
51. Securities Brokerage51. Natural Gas (Diversified)
52. Oilfield Svcs/Equipment52. Computers and Peripherals
53. Computers and Peripherals53. Oilfield Svcs/Equipment
54. Trucking/Transp. Leasing54. Trucking/Transp. Leasing
55. Petroleum (Producing)55. Shoe
56. Shoe56. Petroleum (Producing)
57. Retail (Special Lines)57. Retail (Special Lines)

-- Thomas Bulkowski. Donate now to keep this website free.

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Friday 1/22/16. 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 7 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 648 stocks searched, or 1.1%. 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 3 bullish chart patterns this week and 3 bearish ones with any remaining (2) 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.

More...

-- Thomas Bulkowski. Donate now to keep this website free.

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
ALKSDead-cat bounce      01/21/201601/21/2016Drug
BSETDouble Bottom, Adam and Adam      12/24/201501/20/2016Furn/Home Furnishings
EIXRectangle bottom      11/12/201501/21/2016Electric Utility (West)
HBIPipe top      01/04/201601/11/2016Apparel
KSSPipe top      01/04/201601/11/2016Retail Store
KWRDiamond bottom      01/07/201601/21/2016Chemical (Specialty)
REVPipe bottom      01/04/201601/11/2016Toiletries/Cosmetics
VVUSRectangle bottom      12/07/201501/21/2016Biotechnology

 

Weekly screen for chart patterns ending between 01/14/2016 and 01/21/2016. 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.
 
Alkermes (ALKS)
Industry: Drug
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 41 out of 56
Stock RS rank: 608 out of 641
1/21/16 close: $33.69
1 Month avg volatility: $3.71. Volatility stop (for downward breakout): $47.71 or 41.6% above the close.
Change YTD: -57.56%
Volume: 12,465,200 shares. 3 month avg: 1,136,137 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: Dead-cat bounce continuation pattern from 01/21/2016 to 01/21/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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Bassett Furniture Industries Inc (BSET)
Industry: Furn/Home Furnishings
Industry RS rank: 25 out of 56
Stock RS rank: 378 out of 641
1/21/16 close: $29.37
1 Month avg volatility: $1.45. Volatility stop (for upward breakout): $20.07 or 31.7% below the close.
Change YTD: 17.11%
Volume: 380,100 shares. 3 month avg: 75,983 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: Double Bottom, Adam and Adam reversal pattern from 12/24/2015 to 01/20/2016
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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Edison International (EIX)
Industry: Electric Utility (West)
Industry RS rank: 3 out of 56
Stock RS rank: 113 out of 641
1/21/16 close: $58.72
1 Month avg volatility: $1.01. Volatility stop (for downward breakout): $61.51 or 4.8% above the close.
Change YTD: -0.83%
Volume: 2,045,600 shares. 3 month avg: 2,443,595 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 bottom continuation pattern from 11/12/2015 to 01/21/2016
Breakout is downward 55% of the time.
Average decline: 14%.
Break-even failure rate: 16%.
Pullbacks occur 69% of the time.
Price hits measure rule target 50% of the time.

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Hanesbrand Inc. (HBI)
Industry: Apparel
Industry RS rank: 31 out of 56
Stock RS rank: 314 out of 641
1/21/16 close: $28.88
1 Month avg volatility: $0.94. Volatility stop (for downward breakout): $31.15 or 7.9% above the close.
Change YTD: -1.87%
Volume: 2,819,800 shares. 3 month avg: 3,630,094 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 01/04/2016 to 01/11/2016
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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Kohls Corporation (KSS)
Industry: Retail Store
Industry RS rank: 38 out of 56
Stock RS rank: 448 out of 641
1/21/16 close: $46.99
1 Month avg volatility: $1.75. Volatility stop (for downward breakout): $50.97 or 8.5% above the close.
Change YTD: -1.34%
Volume: 2,807,100 shares. 3 month avg: 4,405,398 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 01/04/2016 to 01/11/2016
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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Quaker Chemical (KWR)
Industry: Chemical (Specialty)
Industry RS rank: 21 out of 56
Stock RS rank: 289 out of 641
1/21/16 close: $69.92
1 Month avg volatility: $2.07. Volatility stop (for upward breakout): $65.52 or 6.3% below the close.
Change YTD: -9.50%
Volume: 48,200 shares. 3 month avg: 71,372 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: Diamond bottom reversal pattern from 01/07/2016 to 01/21/2016
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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Revlon Inc (REV)
Industry: Toiletries/Cosmetics
Industry RS rank: 24 out of 56
Stock RS rank: 321 out of 641
1/21/16 close: $29.70
1 Month avg volatility: $1.11. Volatility stop (for upward breakout): $27.40 or 7.7% below the close.
Change YTD: 6.68%
Volume: 61,100 shares. 3 month avg: 55,468 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: Pipe bottom reversal pattern from 01/04/2016 to 01/11/2016
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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Vivus Inc (VVUS)
Industry: Biotechnology
Industry RS rank: 49 out of 56
Stock RS rank: 595 out of 641
1/21/16 close: $1.04
1 Month avg volatility: $0.07. Volatility stop (for downward breakout): $1.23 or 18.7% above the close.
Change YTD: 1.96%
Volume: 1,444,400 shares. 3 month avg: 1,536,582 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 bottom continuation pattern from 12/07/2015 to 01/21/2016
WARNING: A dead-cat bounce occurred on 08/06/2015. There is a 38% chance that a 15% or higher decline will occur (or has occurred since then) by 02/04/2016.
Breakout is downward 55% of the time.
Average decline: 14%.
Break-even failure rate: 16%.
Pullbacks occur 69% of the time.
Price hits measure rule target 50% of the time.

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Thursday 1/21/16. Intraday Market Direction: Nasdaq

The index dropped by -0.1% or -5.26 points. Since 02/05/1971 the index made 545 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.8% on 297 occasions.
     Average loss was -0.9% on 248 occasions.
Expect the index to close higher 54.5% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 97/167 or 58.1% of the time.
     The prediction of the index closing lower has been right 34/71 or 47.9% 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 a down-sloping channel using two red lines drawn along the peaks and valleys from recent days.

The index briefly dipped below the lower line before powering upward. My sense is that the index will continue higher until meeting the top red line near A before crumbling again.

A higher close tomorrow (Thursday) also agrees with the above probabilities.

My sense is that this correction is unwarranted both in its severity and extent. It's time for a rebound.

$ $ $

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. Donate now to keep this website free.

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© 2016 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  3,971.78    
 Monthly S1  4,221.74  249.95   
 Daily S2  4,231.80  10.07   Yes! The Daily S2 is close to the Monthly S1.
 Weekly S2  4,239.91  8.11   Yes! The Weekly S2 is close to the Daily S2.
 Low  4,313.39  73.48   
 Daily S1  4,351.75  38.36   
 Weekly S1  4,355.80  4.05   Yes! The Weekly S1 is close to the Daily S1.
 61.8% Down from Intraday High  4,390.37  34.57   
 Open  4,405.22  14.85   Yes! The Open is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  4,414.15  8.93   Yes! The 50% Down from Intraday High is close to the Open.
 Daily Pivot  4,433.33  19.18   Yes! The Daily Pivot is close to the 50% Down from Intraday High.
 38.2% Down from Intraday High  4,437.94  4.60   Yes! The 38.2% Down from Intraday High is close to the Daily Pivot.
 Close  4,471.69  33.75   
 High  4,514.92  43.23   
 Weekly Pivot  4,535.30  20.38   
 Daily R1  4,553.28  17.98   Yes! The Daily R1 is close to the Weekly Pivot.
 Daily R2  4,634.86  81.59   
 Weekly R1  4,651.19  16.33   Yes! The Weekly R1 is close to the Daily R2.
 Monthly Pivot  4,669.36  18.17   Yes! The Monthly Pivot is close to the Weekly R1.
 Weekly R2  4,830.69  161.33   
 Monthly R1  4,919.32  88.63   
 Monthly R2  5,366.94  447.63   

Wednesday 1/20/16. A Look At Indicators

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 still shows a bearish reading. The index has followed the indicator lower, too.

There is one hint of a coming trend change. Circled in red, the indicator has been trending upward for about a week, as the green line shows. Compare that to the index. It's been trending lower over the same period. That bullish divergence suggests the index is going to swing higher. When is the question, though.

Picture of the percent down indicators

This is a new set of indicators that I'll be featuring on Wednesday's. Both measure how far stocks have dropped from their 1-year high.

Notice that the blue line has been trending lower for months now, even before the index peaked in May. That shows stocks were trending down even as the index moved up.

Here's some more information about the lines.

The red line is the percentage of stocks at least 20% below their 1-year high (plotted upside down). The blue line is the average percentage drop of stocks below their 1-year high (plotted upside down).

Shown as a red line on the above chart...

On Friday, 65% of stocks in my database are in bear market territory (down at least 20% from their 1-year high).
A week ago, it was 60%.
The fewest was 20% on 04/15/2015.
And the most was 65% on 01/15/2016.

Shown as a blue line on the above chart...

The 546 stocks in my database are down an average of 30% from their yearly high.
A week ago, the average was 28%.
The peak was 12% on 02/24/2015.
And the bottom was 30% on 01/15/2016.

-- Thomas Bulkowski. Donate now to keep this website free.

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Tuesday 1/19/16. Intraday Market Direction: Dow

The index dropped by -2.4% or -390.97 points. Since 10/01/1928 the index made 56 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 2.2% on 29 occasions.
     Average loss was -1.0% on 27 occasions.
Expect the index to close higher 51.8% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 107/178 or 60.1% of the time.
     The prediction of the index closing lower has been right 28/54 or 51.9% 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 USO on the weekly

$ $ $

I show a picture of the USO fund on the weekly scale.

What's the deal with oil? I wanted to find out so I show you a chart of USO: United States Oil, an exchange traded fund.

According to yahoo finance, the fund, "seeks to reflect the performance of the spot price of West Texas Intermediate (WTI) light, sweet crude oil. The fund will invest in futures contracts for light, sweet crude oil."

Thus, what you're looking at is not the price of oil, but a fund that trades in oil futures.

A symmetrical triangle appears within the two converging red lines. The fund broke out upward at A but it was a fake out. The fund collapsed, breaking out downward at B and busting the upward breakout. When a stock (ETF) busts, it often results in a strong move, as you see here. The ETF tumbled from the peak in July to the Friday's low.

One day the fund will reverse. Imagine seeing the price of the fund rise to 15. That's a 50% move up. Then keep the move going, to restore the fund back up to the cloud bank at 30 to 40. Nice.

It'll happen, but probably not anytime soon.

$ $ $

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. Donate now to keep this website free.

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© 2016 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  14,587.67    
 Monthly S1  15,287.87  700.21   
 Weekly S2  15,389.83  101.96   
 Daily S2  15,549.29  159.45   
 Weekly S1  15,688.96  139.67   
 Daily S1  15,768.68  79.73   
 Low  15,842.11  73.43   
 Close  15,988.08  145.97   
 61.8% Down from Intraday High  16,037.78  49.70   Yes! The 61.8% Down from Intraday High is close to the Close.
 Daily Pivot  16,061.51  23.73   Yes! The Daily Pivot is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  16,098.22  36.71   Yes! The 50% Down from Intraday High is close to the Daily Pivot.
 Weekly Pivot  16,141.23  43.01   Yes! The Weekly Pivot is close to the 50% Down from Intraday High.
 38.2% Down from Intraday High  16,158.66  17.43   Yes! The 38.2% Down from Intraday High is close to the Weekly Pivot.
 Daily R1  16,280.90  122.24   
 High  16,354.33  73.43   
 Open  16,354.33  0.00   Yes! The Open is close to the High.
 Weekly R1  16,440.36  86.03   
 Monthly Pivot  16,542.32  101.96   
 Daily R2  16,573.73  31.41   Yes! The Daily R2 is close to the Monthly Pivot.
 Weekly R2  16,892.63  318.91   
 Monthly R1  17,242.52  349.89   
 Monthly R2  18,496.97  1,254.44   

Friday 1/15/16. 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 17 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 649 stocks searched, or 2.6%. Based on the percentage, the stock market is trending since few consolidation patterns appear.

Excluding ETFs, there were 3 bullish chart patterns this week and 14 bearish ones with any remaining (0) 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.

More...

-- Thomas Bulkowski. Donate now to keep this website free.

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
AXDXThree Falling Peaks      12/16/201501/08/2016Medical Services
ALKSBroadening top, right-angled and ascending      11/02/201501/08/2016Drug
BOOTDead-cat bounce      01/12/201601/12/2016Shoe
FCXDead-cat bounce      01/11/201601/11/2016Metals and Mining (Div.)
GPRODead-cat bounce      01/13/201601/13/2016Electronics
MONBroadening top      11/17/201501/08/2016Chemical (Diversified)
NWYBroadening top      12/14/201501/12/2016Apparel
NSHPipe top      12/28/201501/04/2016Natural Gas (Distributor)
PMCPipe top      12/28/201501/04/2016Medical Services
PEGHead-and-shoulders complex bottom      11/09/201501/12/2016Electric Utility (East)
RHTBroadening top      11/11/201501/13/2016Computer Software and Svcs
SHLMDead-cat bounce      01/11/201601/11/2016Chemical (Specialty)
SLGNPipe top      12/28/201501/04/2016Packaging and Container
SKULDead-cat bounce      01/12/201601/12/2016Electronics
TGTBroadening bottom      11/27/201501/14/2016Retail Store
TFXRectangle top      11/04/201501/08/2016Diversified Co.
WMBDead-cat bounce      01/12/201601/13/2016Natural Gas (Distributor)

 

Weekly screen for chart patterns ending between 01/07/2016 and 01/14/2016. 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.
 
Accelerate Diagnostics Inc (AXDX)
Industry: Medical Services
Industry RS rank: 27 out of 56
Stock RS rank: 501 out of 641
1/14/16 close: $17.63
1 Month avg volatility: $1.19. Volatility stop (for downward breakout): $20.45 or 16.0% above the close.
Change YTD: -17.96%
Volume: 446,900 shares. 3 month avg: 217,442 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: Three Falling Peaks reversal pattern from 12/16/2015 to 01/08/2016
Breakout is downward 100% of the time.
Average decline: 17%.
Break-even failure rate: 12%.
Pullbacks occur 59% of the time.
Price hits measure rule target 33% 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: 30 out of 56
Stock RS rank: 200 out of 641
1/14/16 close: $64.66
1 Month avg volatility: $3.40. Volatility stop (for downward breakout): $72.35 or 11.9% above the close.
Change YTD: -18.54%
Volume: 949,800 shares. 3 month avg: 927,415 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 11/02/2015 to 01/08/2016
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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Boot Barn Holdings Inc (BOOT)
Industry: Shoe
Industry RS rank: 55 out of 56
Stock RS rank: 636 out of 641
1/14/16 close: $7.64
1 Month avg volatility: $0.89. Volatility stop (for downward breakout): $9.74 or 27.5% above the close.
Change YTD: -37.84%
Volume: 738,500 shares. 3 month avg: 551,977 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Dead-cat bounce continuation pattern from 01/12/2016 to 01/12/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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Freeport-McMoRan Copper and Gold B (FCX)
Industry: Metals and Mining (Div.)
Industry RS rank: 35 out of 56
Stock RS rank: 633 out of 641
1/14/16 close: $4.20
1 Month avg volatility: $0.48. Volatility stop (for downward breakout): $5.19 or 23.5% above the close.
Change YTD: -37.96%
Volume: 77,658,000 shares. 3 month avg: 42,459,534 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: Dead-cat bounce continuation pattern from 01/11/2016 to 01/11/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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GoPro (GPRO)
Industry: Electronics
Industry RS rank: 48 out of 56
Stock RS rank: 634 out of 641
1/14/16 close: $12.48
1 Month avg volatility: $1.32. Volatility stop (for downward breakout): $15.46 or 23.9% above the close.
Change YTD: -30.71%
Volume: 31,579,500 shares. 3 month avg: 8,919,305 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Friday.
 
Chart pattern: Dead-cat bounce continuation pattern from 01/13/2016 to 01/13/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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Monsanto Co (MON)
Industry: Chemical (Diversified)
Industry RS rank: 42 out of 56
Stock RS rank: 313 out of 641
1/14/16 close: $92.15
1 Month avg volatility: $1.75. Volatility stop (for downward breakout): $96.27 or 4.5% above the close.
Change YTD: -6.47%
Volume: 3,699,000 shares. 3 month avg: 3,658,135 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 top reversal pattern from 11/17/2015 to 01/08/2016
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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New York and Company Inc (NWY)
Industry: Apparel
Industry RS rank: 38 out of 56
Stock RS rank: 366 out of 641
1/14/16 close: $2.24
1 Month avg volatility: $0.14. Volatility stop (for downward breakout): $2.60 or 16.2% above the close.
Change YTD: -2.18%
Volume: 179,900 shares. 3 month avg: 80,494 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 Thursday.
 
Chart pattern: Broadening top reversal pattern from 12/14/2015 to 01/12/2016
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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NuStar GP Holdings (NSH)
Industry: Natural Gas (Distributor)
Industry RS rank: 34 out of 56
Stock RS rank: 609 out of 641
1/14/16 close: $17.17
1 Month avg volatility: $1.43. Volatility stop (for downward breakout): $20.09 or 17.0% above the close.
Change YTD: -18.82%
Volume: 205,700 shares. 3 month avg: 255,752 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: Pipe top reversal pattern from 12/28/2015 to 01/04/2016
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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PharMerica Corp (PMC)
Industry: Medical Services
Industry RS rank: 27 out of 56
Stock RS rank: 264 out of 641
1/14/16 close: $32.01
1 Month avg volatility: $1.33. Volatility stop (for downward breakout): $34.89 or 9.0% above the close.
Change YTD: -8.54%
Volume: 280,100 shares. 3 month avg: 247,920 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: Pipe top reversal pattern from 12/28/2015 to 01/04/2016
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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Public Service Enterprise Group PEG (PEG)
Industry: Electric Utility (East)
Industry RS rank: 5 out of 56
Stock RS rank: 171 out of 641
1/14/16 close: $39.74
1 Month avg volatility: $0.70. Volatility stop (for upward breakout): $37.30 or 6.2% below the close.
Change YTD: 2.71%
Volume: 4,829,100 shares. 3 month avg: 3,107,237 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 complex bottom reversal pattern from 11/09/2015 to 01/12/2016
Breakout is upward 100% of the time.
Average rise: 39%.
Break-even failure rate: 4%.
Throwbacks occur 63% of the time.
Price hits measure rule target 74% of the time.

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Red Hat, Inc (RHT)
Industry: Computer Software and Svcs
Industry RS rank: 28 out of 56
Stock RS rank: 187 out of 641
1/14/16 close: $76.53
1 Month avg volatility: $1.76. Volatility stop (for downward breakout): $80.48 or 5.2% above the close.
Change YTD: -7.58%
Volume: 2,728,800 shares. 3 month avg: 1,586,378 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 11/11/2015 to 01/13/2016
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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Schulman, A. (SHLM)
Industry: Chemical (Specialty)
Industry RS rank: 29 out of 56
Stock RS rank: 562 out of 641
1/14/16 close: $23.70
1 Month avg volatility: $1.50. Volatility stop (for downward breakout): $29.08 or 22.7% above the close.
Change YTD: -22.65%
Volume: 225,400 shares. 3 month avg: 188,245 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 continuation pattern from 01/11/2016 to 01/11/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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Silgan Holdings Inc (SLGN)
Industry: Packaging and Container
Industry RS rank: 16 out of 56
Stock RS rank: 194 out of 641
1/14/16 close: $50.05
1 Month avg volatility: $1.51. Volatility stop (for downward breakout): $53.93 or 7.7% above the close.
Change YTD: -6.83%
Volume: 747,000 shares. 3 month avg: 287,523 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: Pipe top reversal pattern from 12/28/2015 to 01/04/2016
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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Skullcandy Inc (SKUL)
Industry: Electronics
Industry RS rank: 48 out of 56
Stock RS rank: 618 out of 641
1/14/16 close: $3.09
1 Month avg volatility: $0.21. Volatility stop (for downward breakout): $3.56 or 15.1% above the close.
Change YTD: -34.67%
Volume: 396,300 shares. 3 month avg: 335,455 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Dead-cat bounce continuation pattern from 01/12/2016 to 01/12/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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Target (TGT)
Industry: Retail Store
Industry RS rank: 39 out of 56
Stock RS rank: 342 out of 641
1/14/16 close: $70.41
1 Month avg volatility: $1.54. Volatility stop (for upward breakout): $66.92 or 5.0% below the close.
Change YTD: -3.03%
Volume: 6,282,900 shares. 3 month avg: 5,921,005 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 bottom reversal pattern from 11/27/2015 to 01/14/2016
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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Teleflex Inc (TFX)
Industry: Diversified Co.
Industry RS rank: 33 out of 56
Stock RS rank: 198 out of 641
1/14/16 close: $129.17
1 Month avg volatility: $2.22. Volatility stop (for upward breakout): $124.55 or 3.6% below the close.
Change YTD: -1.73%
Volume: 583,400 shares. 3 month avg: 232,638 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: Rectangle top continuation pattern from 11/04/2015 to 01/08/2016
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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Williams Companies Inc. (WMB)
Industry: Natural Gas (Distributor)
Industry RS rank: 34 out of 56
Stock RS rank: 628 out of 641
1/14/16 close: $18.29
1 Month avg volatility: $1.97. Volatility stop (for downward breakout): $22.38 or 22.4% above the close.
Change YTD: -28.83%
Volume: 42,550,000 shares. 3 month avg: 12,525,552 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: Dead-cat bounce continuation pattern from 01/12/2016 to 01/13/2016
Breakout is downward 67% of the time.
Average decline: 18%.

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Thursday 1/14/16. Intraday Market Direction: Nasdaq

The index dropped by -3.4% or -159.86 points. Since 02/05/1971 the index made 8 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 2.1% on 3 occasions.
     Average loss was -3.3% on 5 occasions.
Expect the index to close lower 62.5% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 97/167 or 58.1% of the time.
     The prediction of the index closing lower has been right 34/70 or 48.6% 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 the green line just to see how the price action of the last two days moved around it. The dot where the horizontal red line begins seems to be a support area. The index is also undecided about direction to the right of C.

A double top forms using peaks A and B. It confirms as a valid pattern when the index closes below the red line.

The index has fulfilled (or is very close to doing so) the measure rule for double tops. The measure rule helps pick a price target. It's the height of the chart pattern subtracted from the red line.

I'm hoping for a higher close, but the above probabilities says that's probably not going to happen.

$ $ $

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. Donate now to keep this website free.

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© 2016 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  4,261.15    
 Daily S2  4,389.45  128.29   
 Monthly S1  4,393.61  4.16   Yes! The Monthly S1 is close to the Daily S2.
 Weekly S2  4,408.00  14.39   Yes! The Weekly S2 is close to the Monthly S1.
 Daily S1  4,457.75  49.75   
 Weekly S1  4,467.03  9.28   Yes! The Weekly S1 is close to the Daily S1.
 Low  4,517.56  50.53   
 Close  4,526.06  8.50   Yes! The Close is close to the Low.
 Daily Pivot  4,585.87  59.81   
 61.8% Down from Intraday High  4,592.59  6.73   Yes! The 61.8% Down from Intraday High is close to the Daily Pivot.
 50% Down from Intraday High  4,615.77  23.18   
 38.2% Down from Intraday High  4,638.95  23.18   
 Daily R1  4,654.17  15.23   Yes! The Daily R1 is close to the 38.2% Down from Intraday High.
 Weekly Pivot  4,696.88  42.71   
 Open  4,706.02  9.14   Yes! The Open is close to the Weekly Pivot.
 High  4,713.98  7.96   Yes! The High is close to the Open.
 Weekly R1  4,755.91  41.93   
 Monthly Pivot  4,770.30  14.39   Yes! The Monthly Pivot is close to the Weekly R1.
 Daily R2  4,782.29  11.98   Yes! The Daily R2 is close to the Monthly Pivot.
 Monthly R1  4,902.76  120.47   
 Weekly R2  4,985.76  83.00   
 Monthly R2  5,279.45  293.69   

Wednesday 1/13/16. 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.

This chart shows the signal changes. Take my word for it that the latest reading is bearish (red bars), not neutral (white bars, invisible on this chart).

The indicator shows that it signaled near the peak in the index about two weeks ago. Since then the index has tumbled.

In the last few days, the indicator has turned up. It's like it bounced off 0 and coasted up to 20 or so, where it sits now.

If we get more positive moves in the index, we could turn bullish in the indicator. That's what I expect to happen. I think this downturn is overdone (over sold) and we will see a snap-back rally.

-- Thomas Bulkowski. Donate now to keep this website free.

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Tuesday 1/12/16. Intraday Market Direction: Dow

The index climbed by 0.3% or 52.12 points. Since 10/01/1928 the index made 1044 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.8% on 576 occasions.
     Average loss was -0.7% on 468 occasions.
Expect the index to close higher 55.2% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 106/177 or 59.9% of the time.
     The prediction of the index closing lower has been right 28/54 or 51.9% 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 drew a red trendline down along the peaks of the last several days of trading.

Notice how today's close came close to the trendline. It suggests the trendline marks overhead resistance that the index is going to struggle to push through.

Of course, the international stage will push the markets around. So if China burps, we'll have a hiccup.

The trend of the futures market before the open will help set the stage for tomorrow's (Tuesday's) ride. I'm still expecting the markets to fall. That would be good news because I searched all weekend for stocks to buy and didn't find any. I'm thinking that a cheaper price might price my fingers loose from some cash.

$ $ $

I bought a new computer and worked on setting it up today. I got it running easily enough but I wanted it to run my Windows XP software. Thus, if my main computer crashes, and my backup machine crashes, I have a Window 7 Pro system to fill in.

That will become important a decade or two down the road. I still don't want to rewrite all of the software I developed.

Anyway, I downloaded three files to get it working. The first checked my hardware to make sure my system was up to snuff (the CPU supports hardware virtualization).

The remaining two files were the XP simulator. One was big, took a few minutes to download it.

It took less than 30 minutes to get the simulator installed and working. Then I copied over my files from an external hard drive and proved that my XP software worked on the simulator.

I felt so good about this achievement, I celebrated by having a glass of wine.

The stuff is so dry, it taste like paint thinner.

$ $ $

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. Donate now to keep this website free.

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© 2016 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  15,307.97    
 Weekly S2  15,615.30  307.33   
 Monthly S1  15,853.27  237.97   
 Weekly S1  16,006.93  153.66   
 Daily S2  16,134.33  127.40   
 Low  16,232.03  97.70   
 Daily S1  16,266.45  34.42   
 61.8% Down from Intraday High  16,319.82  53.37   
 50% Down from Intraday High  16,346.94  27.12   
 Open  16,358.71  11.77   Yes! The Open is close to the 50% Down from Intraday High.
 Daily Pivot  16,364.15  5.44   Yes! The Daily Pivot is close to the Open.
 38.2% Down from Intraday High  16,374.06  9.91   Yes! The 38.2% Down from Intraday High is close to the Daily Pivot.
 Close  16,398.57  24.51   
 High  16,461.85  63.28   
 Daily R1  16,496.27  34.42   
 Daily R2  16,593.97  97.70   
 Weekly Pivot  16,706.21  112.24   
 Monthly Pivot  16,859.87  153.66   
 Weekly R1  17,097.84  237.97   
 Monthly R1  17,405.17  307.33   
 Weekly R2  17,797.12  391.95   
 Monthly R2  18,411.77  614.65   

Monday 1/11/16. Market Monday: The Week Ahead

My Prediction

Picture of the nasdaq composite on the daily scale.

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

On my computer, the head-and-shoulders top looks like a head-and-shoulders. On this figure, the left shoulder (LS) and Head (H) look more like a double top.

The height of the pattern from the head to the neckline directly below (shown here as a blue line at A), projected downward from the neckline, gives a target. That target could serve as a minimum decline.

I did not measure the height, but it looks like the index has almost met the target. My guess is the target is just below the purple (magenta) line. The index has another day of declining to\ get there.

The horizontal red line is what I use as a sell signal for those cases, like this one, in which the neckline slopes downward. When the index closes below the red line, it confirms the head-and-shoulders as a valid chart pattern.

I show support areas as the magenta line and two green lines.

I used the magenta line for "Tom's Targets" at the top of this page but the green area might work as support, too.

One thing is certain. China's stock market is going to go up and down, vibrating the US markets accordingly. So quick in-and-out trading (swing trading) might be in vogue for the next 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 276.09 points.
Tuesday: Up 9.72 points.
Wednesday: Down 252.15 points.
Thursday: Down 392.41 points.
Friday: Down 167.65 points.

For the Week...

The Dow industrials were down 1078.58 points or 6.2%.
The Nasdaq composite was down 363.78 points or 7.3%.
The S&P 500 index was down 121.91 points or 6.0%.

Year to Date...

Dow Industrials
     6.1% down from the high of 17,405.48 on 01/04/2016.
     0.2% up from the low of 16,314.57 on 01/08/2016.
Nasdaq
     5.7% down from the high of 4,926.73 on 01/05/2016.
     0.1% up from the low of 4,637.85 on 01/08/2016.
S&P 500
     5.7% down from the high of 2,038.20 on 01/04/2016.
     0.2% up from the low of 1,918.46 on 01/08/2016.

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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
Crude inventories10:30 W?My guess: Measures oil inventory.
FEDs Beige book2:00 W?Reports on economic conditions.
Treasury budget2:00 WDTracks budget deficit. Important in April (tax filing).
Initial jobless claims8:30 ThC+Counts people filing for state unemployment benefits.
International trade8:30 ThC+Import/export prices, trade balance. US economy vs others.
Retail sales8:30 FA-Reports total retail sales (not services). Are people spending?
Producer price index8:30 FB-Measures wholesale goods cost. An indication of future inflation.
Industrial production9:15 FB-Production of utilities, mines, and manufacturers.
Capacity utilization9:15 FB-Gauges economic activity, hints of inflation.
Business inventories10:00 FC-Reports manufacturing, wholesale, retail inventories.

Options Expiration

The following is courtesy of the Options Industry Council.

OptionDate
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 expireFriday

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 01/08/2016, the CPI had:

21 bearish patterns,
0 bullish patterns,
48 patterns waiting for breakout.
The CPI signal is 0.0%, which is bearish (<= 35%).

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

Swing Traders: Pivot Points

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

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  16,100  16,223  16,438  16,561  16,775 
Weekly  15,598  15,972  16,689  17,063  17,780 
Monthly  15,291  15,819  16,842  17,370  18,394 
S&P500 (^GSPC): Daily  1,892  1,907  1,934  1,949  1,976 
Weekly  1,840  1,881  1,960  2,001  2,079 
Monthly  1,803  1,862  1,978  2,038  2,153 
Nasdaq (^IXIC): Daily  4,570  4,607  4,675  4,712  4,779 
Weekly  4,447  4,545  4,736  4,834  5,025 
Monthly  4,300  4,472  4,809  4,981  5,319 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

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

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Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 2 weeks down 15.7%   Expect a reversal soon. 
 2 months down 10.3%   Expect a reversal soon. 
 S & P 500 (^GSPC) 2 weeks down 14.5%   Expect a reversal soon. 
 2 months down 10.0%   Expect a reversal soon. 
 Nasdaq composite (^IXIC) 2 weeks down 16.8%   Expect a reversal soon. 
 2 months down 15.0%   Expect a reversal soon. 

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

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

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

Buy-and-Hold: 12-Month SMA

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

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Earnings, Chart Patterns & Industries

Earnings season will be starting in about 5 days.

 Found Chart Pattern Name
17Head-and-shoulders top
11Triangle, symmetrical
11Pipe bottom
7Dead-cat bounce
7Pipe top
7Triple top
6Broadening top
6Triangle, ascending
5Double Top, Adam and Adam
3Double Top, Eve and Eve

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

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

 

 

 

 

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

This WeekLast Week
1. Internet1. Internet
2. Short ETFs2. Short ETFs
3. Electric Utility (West)3. Electric Utility (West)
4. Electric Utility (Central)4. Insurance (Prop/Casualty)
5. Household Products5. Furn/Home Furnishings
50. Homebuilding50. Oilfield Svcs/Equipment
51. Natural Gas (Diversified)51. Trucking/Transp. Leasing
52. Computers and Peripherals52. Natural Gas (Diversified)
53. Oilfield Svcs/Equipment53. Retail (Special Lines)
54. Trucking/Transp. Leasing54. Petroleum (Producing)
55. Shoe54. Petroleum (Producing)
56. Petroleum (Producing)54. Petroleum (Producing)
57. Retail (Special Lines)54. Petroleum (Producing)

-- Thomas Bulkowski. Donate now to keep this website free.

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Friday 1/8/16. 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 20 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 630 stocks searched, or 3.2%. 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 10 bearish ones with any remaining (3) 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.

More...

-- Thomas Bulkowski. Donate now to keep this website free.

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
AXDXHorn top      12/14/201512/28/2015Medical Services
BIORectangle bottom      08/25/201501/06/2016Medical Supplies
CALMPipe top      12/21/201512/28/2015Food Processing
CLGXDouble Bottom, Adam and Adam      12/22/201501/04/2016Information Services
CREEPipe top      12/21/201512/28/2015Semiconductor
DOTriangle, symmetrical      12/10/201501/04/2016Oilfield Svcs/Equipment
EFXBroadening top      11/24/201501/07/2016Information Services
GLFTriangle, descending      11/03/201501/04/2016Oilfield Svcs/Equipment
HGGDead-cat bounce      01/06/201601/06/2016Retail (Special Lines)
HOVPipe top      12/21/201512/28/2015Homebuilding
ITWBroadening top, right-angled and descending      12/03/201501/04/2016Metal Fabricating
IPGBroadening top      11/06/201501/07/2016Advertising
JCPDouble Bottom, Adam and Adam      12/18/201501/04/2016Retail Store
KLICPipe top      12/21/201512/28/2015Semiconductor Cap Equip.
LBroadening top      11/03/201501/07/2016Insurance (Prop/Casualty)
MDouble Bottom, Eve and Adam      12/22/201501/04/2016Retail Store
ROGPipe top      12/21/201512/28/2015Electronics
SUNEDead-cat bounce      01/07/201601/07/2016Semiconductor
TFXRectangle top      11/04/201501/07/2016Diversified Co.
PAYPipe top      12/21/201512/28/2015Telecom. Equipment

 

Weekly screen for chart patterns ending between 12/31/2015 and 01/07/2016. 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.
 
Accelerate Diagnostics Inc (AXDX)
Industry: Medical Services
Industry RS rank: 27 out of 56
Stock RS rank: 413 out of 623
1/7/16 close: $19.97
1 Month avg volatility: $1.31. Volatility stop (for downward breakout): $23.15 or 15.9% above the close.
Change YTD: -7.07%
Volume: 355,200 shares. 3 month avg: 195,791 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: Horn top reversal pattern from 12/14/2015 to 12/28/2015
Breakout is downward 100% of the time.
Average decline: 21%.
Break-even failure rate: 7%.
Pullbacks occur 33% of the time.
Price hits measure rule target 70% of the time.

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Bio-Rad Laboratories (BIO)
Industry: Medical Supplies
Industry RS rank: 7 out of 56
Stock RS rank: 312 out of 623
1/7/16 close: $131.99
1 Month avg volatility: $2.27. Volatility stop (for downward breakout): $137.38 or 4.1% above the close.
Change YTD: -4.81%
Volume: 190,600 shares. 3 month avg: 103,908 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: Rectangle bottom continuation pattern from 08/25/2015 to 01/06/2016
Breakout is downward 55% of the time.
Average decline: 14%.
Break-even failure rate: 16%.
Pullbacks occur 69% of the time.
Price hits measure rule target 50% of the time.

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Cal-Maine Foods Inc (CALM)
Industry: Food Processing
Industry RS rank: 15 out of 56
Stock RS rank: 363 out of 623
1/7/16 close: $46.98
1 Month avg volatility: $2.28. Volatility stop (for downward breakout): $51.76 or 10.2% above the close.
Change YTD: 1.38%
Volume: 928,900 shares. 3 month avg: 1,081,612 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 12/21/2015 to 12/28/2015
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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CoreLogic Inc (CLGX)
Industry: Information Services
Industry RS rank: 30 out of 56
Stock RS rank: 366 out of 623
1/7/16 close: $35.30
1 Month avg volatility: $0.89. Volatility stop (for upward breakout): $33.14 or 6.1% below the close.
Change YTD: 4.25%
Volume: 947,300 shares. 3 month avg: 491,637 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 12/22/2015 to 01/04/2016
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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Cree Inc (CREE)
Industry: Semiconductor
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 23 out of 56
Stock RS rank: 134 out of 623
1/7/16 close: $25.14
1 Month avg volatility: $0.79. Volatility stop (for downward breakout): $27.33 or 8.7% above the close.
Change YTD: -5.74%
Volume: 1,001,900 shares. 3 month avg: 1,322,975 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Pipe top reversal pattern from 12/21/2015 to 12/28/2015
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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Diamond Offshore (DO)
Industry: Oilfield Svcs/Equipment
Industry RS rank: 52 out of 56
Stock RS rank: 488 out of 623
1/7/16 close: $18.41
1 Month avg volatility: $0.95. Volatility stop (for upward breakout): $16.34 or 11.3% below the close.
Change YTD: -12.75%
Volume: 3,502,700 shares. 3 month avg: 2,699,360 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Monday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 12/10/2015 to 01/04/2016
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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Equifax Inc (EFX)
Industry: Information Services
Industry RS rank: 30 out of 56
Stock RS rank: 64 out of 623
1/7/16 close: $105.29
1 Month avg volatility: $1.92. Volatility stop (for downward breakout): $112.28 or 6.6% above the close.
Change YTD: -5.46%
Volume: 1,087,900 shares. 3 month avg: 665,805 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 top reversal pattern from 11/24/2015 to 01/07/2016
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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Gulfmark Offshore Inc (GLF)
Industry: Oilfield Svcs/Equipment
Industry RS rank: 52 out of 56
Stock RS rank: 615 out of 623
1/7/16 close: $3.23
1 Month avg volatility: $0.46. Volatility stop (for downward breakout): $4.72 or 46.2% above the close.
Change YTD: -30.84%
Volume: 627,600 shares. 3 month avg: 541,831 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, descending reversal pattern from 11/03/2015 to 01/04/2016
WARNING: A dead-cat bounce occurred on 11/10/2015. There is a 26% chance that a 15% or higher decline will occur (or has occurred since then) by 02/09/2016 and a 38% chance by 05/10/2016.
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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hhgregg, Inc (HGG)
Industry: Retail (Special Lines)
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 56 out of 56
Stock RS rank: 498 out of 623
1/7/16 close: $2.50
1 Month avg volatility: $0.27. Volatility stop (for upward breakout): $1.86 or 25.6% below the close.
Change YTD: -31.69%
Volume: 333,600 shares. 3 month avg: 134,458 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: Dead-cat bounce from 01/06/2016 to 01/06/2016

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Hovnanian Enterprises Inc (HOV)
Industry: Homebuilding
Industry RS rank: 49 out of 56
Stock RS rank: 541 out of 623
1/7/16 close: $1.54
1 Month avg volatility: $0.11. Volatility stop (for downward breakout): $1.92 or 24.5% above the close.
Change YTD: -14.92%
Volume: 4,116,100 shares. 3 month avg: 2,057,765 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 12/21/2015 to 12/28/2015
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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Illinois Tool Works Inc. (ITW)
Industry: Metal Fabricating
Industry RS rank: 17 out of 56
Stock RS rank: 264 out of 623
1/7/16 close: $84.73
1 Month avg volatility: $1.35. Volatility stop (for upward breakout): $81.81 or 3.5% below the close.
Change YTD: -8.58%
Volume: 2,606,600 shares. 3 month avg: 1,650,135 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 top, right-angled and descending continuation pattern from 12/03/2015 to 01/04/2016
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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Interpublic Group of Companies (IPG)
Industry: Advertising
Industry RS rank: 9 out of 56
Stock RS rank: 32 out of 623
1/7/16 close: $22.16
1 Month avg volatility: $0.42. Volatility stop (for downward breakout): $23.53 or 6.2% above the close.
Change YTD: -4.81%
Volume: 3,355,700 shares. 3 month avg: 3,545,517 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: Broadening top reversal pattern from 11/06/2015 to 01/07/2016
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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JC Penney Company Inc (JCP)
Industry: Retail Store
Industry RS rank: 36 out of 56
Stock RS rank: 480 out of 623
1/7/16 close: $7.26
1 Month avg volatility: $0.28. Volatility stop (for upward breakout): $6.53 or 10.0% below the close.
Change YTD: 9.01%
Volume: 24,522,700 shares. 3 month avg: 14,134,857 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: Double Bottom, Adam and Adam reversal pattern from 12/18/2015 to 01/04/2016
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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Kulicke and Soffa (KLIC)
Industry: Semiconductor Cap Equip.
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 11 out of 56
Stock RS rank: 262 out of 623
1/7/16 close: $11.05
1 Month avg volatility: $0.41. Volatility stop (for downward breakout): $11.99 or 8.6% above the close.
Change YTD: -5.31%
Volume: 528,400 shares. 3 month avg: 656,732 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 12/21/2015 to 12/28/2015
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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Loews Corp (L)
Industry: Insurance (Prop/Casualty)
Industry RS rank: 13 out of 56
Stock RS rank: 235 out of 623
1/7/16 close: $36.16
1 Month avg volatility: $0.59. Volatility stop (for downward breakout): $38.00 or 5.1% above the close.
Change YTD: -5.83%
Volume: 1,448,200 shares. 3 month avg: 1,604,709 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 top reversal pattern from 11/03/2015 to 01/07/2016
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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Macys, Inc (M)
Industry: Retail Store
Industry RS rank: 36 out of 56
Stock RS rank: 590 out of 623
1/7/16 close: $36.89
1 Month avg volatility: $1.03. Volatility stop (for upward breakout): $34.24 or 7.2% below the close.
Change YTD: 5.46%
Volume: 18,241,900 shares. 3 month avg: 8,479,942 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: Double Bottom, Eve and Adam reversal pattern from 12/22/2015 to 01/04/2016
Breakout is upward 100% of the time.
Average rise: 35%.
Break-even failure rate: 4%.
Throwbacks occur 57% of the time.
Price hits measure rule target 66% of the time.

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Rogers Corp (ROG)
Industry: Electronics
Industry RS rank: 48 out of 56
Stock RS rank: 516 out of 623
1/7/16 close: $44.02
1 Month avg volatility: $1.89. Volatility stop (for downward breakout): $50.22 or 14.1% above the close.
Change YTD: -14.64%
Volume: 226,600 shares. 3 month avg: 141,309 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 12/21/2015 to 12/28/2015
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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SunEdison (SUNE)
Industry: Semiconductor
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 23 out of 56
Stock RS rank: 621 out of 623
1/7/16 close: $3.34
1 Month avg volatility: $0.65. Volatility stop (for upward breakout): $1.64 or 50.8% below the close.
Change YTD: -34.38%
Volume: 163,573,100 shares. 3 month avg: 54,361,206 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: Dead-cat bounce from 01/07/2016 to 01/07/2016

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Teleflex Inc (TFX)
Industry: Diversified Co.
Industry RS rank: 33 out of 56
Stock RS rank: 228 out of 623
1/7/16 close: $128.71
1 Month avg volatility: $2.04. Volatility stop (for upward breakout): $123.57 or 4.0% below the close.
Change YTD: -2.08%
Volume: 274,600 shares. 3 month avg: 226,683 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: Rectangle top continuation pattern from 11/04/2015 to 01/07/2016
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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VeriFone Systems, Inc (PAY)
Industry: Telecom. Equipment
Industry RS rank: 28 out of 56
Stock RS rank: 435 out of 623
1/7/16 close: $25.40
1 Month avg volatility: $0.77. Volatility stop (for downward breakout): $27.99 or 10.2% above the close.
Change YTD: -9.35%
Volume: 1,391,900 shares. 3 month avg: 1,293,865 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 12/21/2015 to 12/28/2015
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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Thursday 1/7/16. Intraday Market Direction: Nasdaq

The index dropped by -1.1% or -55.67 points. Since 02/05/1971 the index made 155 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 1.4% on 81 occasions.
     Average loss was -1.3% on 74 occasions.
Expect the index to close higher 52.3% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 97/166 or 58.4% of the time.
     The prediction of the index closing lower has been right 34/70 or 48.6% 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.

The red shows overhead resistance drawn along the top of the index over the last week or so. Notice how the index hits the line and then turns back down.

The green line is a weak support line drawn from the right valley to the left one. I write "weak" because the index dropped below the left valley when forming the right one.

Now, it looks like the index is being squeezed between the two lines.

The above prediction says the index will close higher on Thursday but I'm not convinced. I'm looking for the index to drop below the green line, meaning a lower close.

$ $ $

In this latest down turn, I feel fortunate to be 33% in cash due to portfolio rebalancing last month and some timely selling of energy stocks a few days ago.

When I looked at my spreadsheet of trades, I'm surprised and glad that on 39 trades I more than doubled my money. If you count another stock I currently hold, it hits 40 doubles. That's a good start. Too bad those are from 30 years of being in the market, so that's just over one double a year.

$ $ $

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. Donate now to keep this website free.

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© 2016 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  4,656.19    
 Monthly S1  4,745.98  89.78   
 Daily S2  4,774.15  28.17   
 Low  4,804.69  30.54   
 Daily S1  4,804.95  0.26   Yes! The Daily S1 is close to the Low.
 Open  4,813.76  8.81   
 61.8% Down from Intraday High  4,828.13  14.37   
 50% Down from Intraday High  4,835.37  7.24   
 Daily Pivot  4,835.50  0.13   Yes! The Daily Pivot is close to the 50% Down from Intraday High.
 Close  4,835.76  0.26   Yes! The Close is close to the Daily Pivot.
 38.2% Down from Intraday High  4,842.60  6.84   
 Weekly S1  4,850.89  8.29   
 Weekly S2  4,866.02  15.13   
 High  4,866.04  0.02   Yes! The High is close to the Weekly S2.
 Daily R1  4,866.30  0.26   Yes! The Daily R1 is close to the High.
 Daily R2  4,896.85  30.54   
 Monthly Pivot  4,961.37  64.53   
 Weekly R1  4,968.81  7.44   
 Weekly Pivot  4,983.94  15.13   
 Monthly R1  5,051.16  67.22   
 Weekly R2  5,101.86  50.70   
 Monthly R2  5,266.55  164.69   

Wednesday 1/6/16. 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.

After yesterday's big drop in the indices, the indicator remained bearish, a sign that occurred days ago but probably hasn't confirmed as valid yet. (It takes up to 7 days for the signal to calm down).

The indicator has turned neutral after today's action. It's hard to see on this chart but the right price bar is white: neutral

Another strong move will flip the signal to bullish or bearish easily enough. The neutral stance in the indicator suggests yesterday's drop wasn't important over the longer term.

-- Thomas Bulkowski. Donate now to keep this website free.

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Tuesday 1/5/16. A Look At The Dow

The index dropped by -1.6% or -276.09 points. Since 10/01/1928 the index made 145 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.8% on 67 occasions.
     Average loss was -1.0% on 78 occasions.
Expect the index to close lower 53.8% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 106/177 or 59.9% of the time.
     The prediction of the index closing lower has been right 28/53 or 52.8% 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

Instead of showing the Dow intraday, this is a pic of the index on the daily scale.

I thought it would be important to view the context of what I see happening.

Let me say that the 7% drop in China is equivalent to the Dow dropping 1,200 points. We closed just 276 points lower (1.6%). That's a sneeze for us.

The chart shows three horizontal red lines. Those are Fibonacci retrace levels of 38%, 50%, and 62% of the move between the two green circles (the Sept to Nov rise). Notice that today's price action has touched the 50% bar. I am thinking that the index will drop to the lower red bar before rebounding, but we could turn upward here just as easily.

Why? Because the China thing is just a bump in the road, not much of a cause for concern. We won't go into a recession because of it. Even if China's growth slows (which apparently, it has).

The two green lines mark a channel down. Today's price action pierced the lower line but the index closed well off its lows and above the green line.

All of this suggests nothing to worry about. Maybe use this as an opportunity to update your shopping list. It may be too soon to buy but be ready.

-- Thomas Bulkowski. Donate now to keep this website free.

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© 2016 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  16,604.23    
 Daily S2  16,722.83  118.60   
 Monthly S1  16,876.59  153.75   
 Daily S1  16,935.89  59.30   
 Low  16,957.63  21.74   Yes! The Low is close to the Daily S1.
 Weekly S2  17,111.18  153.55   
 61.8% Down from Intraday High  17,128.71  17.53   Yes! The 61.8% Down from Intraday High is close to the Weekly S2.
 Weekly S1  17,130.06  1.35   Yes! The Weekly S1 is close to the 61.8% Down from Intraday High.
 Close  17,148.94  18.88   Yes! The Close is close to the Weekly S1.
 Daily Pivot  17,170.68  21.74   Yes! The Daily Pivot is close to the Close.
 50% Down from Intraday High  17,181.55  10.87   Yes! The 50% Down from Intraday High is close to the Daily Pivot.
 38.2% Down from Intraday High  17,234.40  52.85   
 Daily R1  17,383.74  149.34   
 Monthly Pivot  17,389.08  5.35   Yes! The Monthly Pivot is close to the Daily R1.
 High  17,405.48  16.40   Yes! The High is close to the Monthly Pivot.
 Open  17,405.48  0.00   Yes! The Open is close to the High.
 Weekly Pivot  17,440.04  34.56   Yes! The Weekly Pivot is close to the Open.
 Weekly R1  17,458.92  18.88   Yes! The Weekly R1 is close to the Weekly Pivot.
 Daily R2  17,618.53  159.61   
 Monthly R1  17,661.44  42.90   Yes! The Monthly R1 is close to the Daily R2.
 Weekly R2  17,768.90  107.46   
 Monthly R2  18,173.93  405.03   

-- Thomas Bulkowski. Donate now to keep this website free.


Monday 1/4/16. The Year Ahead and Behind

Picture of the Dow over time.

This is a picture of the Dow industrials in black, daily scale.

The red line is the prediction made a year ago. Notice that the prediction started the year well but began to deviate in April or May. The prediction went up and the Dow went down.

Annual Performance
Dow utilities-6.5%
Dow transports-17.8%
Nasdaq5.7%
S&P 500-0.7%
Dow industrials-2.2%

Here is how the indices faired during 2015, shown in the table on the right.

The Nasdaq was the only index that I follow to remain in positive territory this year.

The transports really got knocked, falling almost 18%.

Does this mean the transports will outperform the other indices this year? Maybe. I've seen that behavior with the utility index a few years ago. Maybe the Nasdaq will struggle this year and the transports will post the largest gain.

 

Picture of the Dow over time.

This is the predicted path the Dow industrials will take in 2016, daily scale. Since these predictions are mechanical in nature (they use the average of all prior years ending in 6 -- see the link for more info), they are never right, but they do give you an idea of what could happen, based on the historical perspective.

Anyway, this figure suggests the index is going to make a good move up starting later this month and that should peak in May followed by a drop going into July. After that, the index will make a straight-line run up. Nice!

Notice that there's no sustained dip in September (weakest month) or October (a volatile month).

Picture of the Dow over time.

This chart is a longer prediction for the Dow industrials, using the weekly scale.

It shows the Dow rising until October 2017, peaking at 23,369 and then starting a slide that will take it down to 16,580 in March 2019. That means a drop of 29%. In other words, it suggests a bear market is going to begin late next year.

Notice the nice recovery. After the index bottoms in March 2019 at 16,580, it'll start an upward run that will take the index back up to 21,053. Nice!

You can look at the charts of prior years and the predictions to see how close these predictions are.

-- Thomas Bulkowski. Donate now to keep this website free.

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