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

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Busted
Patterns
Candles Chart
Patterns
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Patterns
Small Patterns
Market
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
As of 01/13/2017
19,886 -5.27 0.0%
9,202 57.87 0.6%
657 -0.99 -0.2%
5,574 26.63 0.5%
2,275 4.20 0.2%
YTD
0.6%
1.8%
-0.4%
3.5%
1.6%
Tom's Targets    Overview: 12/30/2016
19,250 or 20,250 by 01/15/2017
8,880 or 9,550 by 01/15/2017
625 or 690 by 01/15/2017
5,650 or 5,400 by 01/15/2017
2,350 or 2,240 by 01/15/2017
Indus strength: None YTD
Mutt Losers: None YTD
Mutt Winners: None YTD

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Tuesday 1/17/17. The Week Ahead

My Prediction

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

The chart is of the S&P 500 index on the daily scale.

I show two lines. They are not trendlines.

Rather, they endeavor to show the relationship between the length of the rise compared to the length of the horizontal move. My feeling is that the two should be proportional.

What does that mean? It's hard to describe, but the two lines look almost proportional to me. I suspect another up move is coming.

The thinking here is that after a steep move upward, the index is going to rest for a time. How long is unknown but it's often proportional to the move up.

Long upward runs or steep runs will require more of a rest.

I think that maybe a few more days to say, oh, a week and it'll look like the index is setup for another move, breaking out of the horizontal travel. Let's just hope the move is up.

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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 76.42 points.
Tuesday: Down 31.85 points.
Wednesday: Up 98.75 points.
Thursday: Down 63.28 points.
Friday: Down 5.27 points.

For the Week...

The Dow industrials were down 78.07 points or 0.4%.
The Nasdaq composite was up 53.06 points or 1.0%.
The S&P 500 index was down 2.3401 points or 0.1%.

Year to Date...

Dow Industrials
     0.6% down from the high of 19,999.63 on 01/06/2017.
     0.6% up from the low of 19,770.47 on 01/12/2017.
Nasdaq
     0.2% down from the high of 5,584.26 on 01/13/2017.
     3.3% up from the low of 5,397.99 on 01/03/2017.
S&P 500
     0.3% down from the high of 2,282.10 on 01/06/2017.
     1.3% up from the low of 2,245.13 on 01/03/2017.

Options Expiration

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

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Swing and Position Traders: Chart Pattern Indicator

As of 01/13/2017, the CPI had:

10 bearish patterns,
30 bullish patterns,
350 patterns waiting for breakout.
The CPI signal is 75.0%, which is bullish (>= 65%).

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

Swing Traders: Pivot Points

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

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  19,793  19,839  19,896  19,942  19,998 
Weekly  19,674  19,780  19,877  19,983  20,079 
Monthly  19,460  19,673  19,836  20,049  20,213 
S&P500 (^GSPC): Daily  2,268  2,271  2,275  2,278  2,282 
Weekly  2,244  2,260  2,269  2,285  2,294 
Monthly  2,215  2,245  2,263  2,293  2,312 
Nasdaq (^IXIC): Daily  5,545  5,559  5,572  5,587  5,599 
Weekly  5,464  5,519  5,552  5,607  5,639 
Monthly  5,298  5,436  5,510  5,648  5,722 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

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

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Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 1 week down 28.8%   The trend may continue. 
 3 months up 29.9%   The trend may continue. 
 S & P 500 (^GSPC) 1 week down 27.5%   The trend may continue. 
 3 months up 36.9%   The trend may continue. 
 Nasdaq composite (^IXIC) 2 weeks up 33.4%   The trend may continue. 
 3 months up 28.2%   The trend may continue. 

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

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

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

Earnings, Chart Patterns & Industries

Earnings season will be starting in about 0 days.

 Found Chart Pattern Name
31Triangle, symmetrical
10Rectangle top
6Channel
6Pipe bottom
5Triangle, ascending
5Head-and-shoulders top
4Rising wedge
3Triangle, descending
3Double Bottom, Adam and Adam
3Flag, high and tight

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. Securities Brokerage1. Securities Brokerage
2. Insurance (Life)2. Insurance (Life)
3. Semiconductor3. Semiconductor
4. Semiconductor Cap Equip.4. Semiconductor Cap Equip.
5. Trucking/Transp. Leasing5. Computers and Peripherals
50. Shoe50. Medical Supplies
51. Electric Utility (West)51. Electric Utility (Central)
52. Furn/Home Furnishings52. Apparel
53. Toiletries/Cosmetics53. Electric Utility (West)
54. Household Products54. Household Products
55. Short ETFs55. Toiletries/Cosmetics
56. Apparel56. Short ETFs
57. Electric Utility (East)57. Electric Utility (East)

-- Thomas Bulkowski

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Friday 1/13/17. 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 28 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 621 stocks searched, or 4.5%. Based on the percentage, the stock market is trending since few consolidation patterns appear.

I found 3 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 20 bullish chart patterns this week and 2 bearish ones with any remaining (5) being undecided. The ratio of bullish to bearish patterns suggests the market is bullish.

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

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
DDDPipe bottom      12/27/201601/03/2017Electronics
APCBroadening top, right-angled and descending      12/20/201601/12/2017Petroleum (Producing)
CXRectangle bottom      12/19/201601/12/2017Cement and Aggregates
CLRRectangle bottom      12/15/201601/06/2017Petroleum (Producing)
CRHTriangle, ascending      12/02/201601/12/2017Cement and Aggregates
CMIChannel      12/16/201601/11/2017Machinery
^DJUChannel      07/22/201601/12/2017None
EFXChannel      12/07/201601/12/2017Information Services
RETriangle, ascending      12/14/201601/09/2017Insurance (Prop/Casualty)
HIGRectangle top      12/05/201601/12/2017Insurance (Prop/Casualty)
HGGDead-cat bounce      01/10/201701/10/2017Retail (Special Lines)
ICONRectangle top      11/11/201601/12/2017Shoe
INFNTriangle, symmetrical      12/02/201601/12/2017Telecom. Equipment
NSPChannel      11/10/201601/12/2017Human Resources
IBKRPipe bottom      12/27/201601/03/2017Securities Brokerage
LNCRectangle top      12/12/201601/12/2017Insurance (Life)
PAYXTriangle, symmetrical      12/21/201601/11/2017IT Services
PFGRectangle top      12/16/201601/12/2017Insurance (Diversified)
PEGRectangle top      12/16/201601/12/2017Electric Utility (East)
KWRTriangle, descending      12/15/201601/12/2017Chemical (Specialty)
SMGRectangle top      12/13/201601/09/2017Chemical (Basic)
SRETriangle, symmetrical      12/13/201601/12/2017Electric Utility (West)
SSYSPipe bottom      12/27/201601/03/2017Electronics
TXNTriangle, ascending      11/29/201601/12/2017Semiconductor
UTXChannel      11/14/201601/11/2017Diversified Co.
VRSNBroadening wedge, descending      11/10/201601/10/2017Internet
YUMERectangle top      12/09/201601/12/2017Advertising
DOGRectangle bottom      12/13/201601/12/2017Short ETFs
DXDRectangle bottom      12/13/201601/12/2017Short ETFs
IATRectangle top      12/08/201601/12/2017Long ETFs
ILFBroadening bottom      11/22/201601/10/2017Investment Co. (Foreign)

 

Weekly screen for chart patterns ending between 01/05/2017 and 01/12/2017. 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.
 
3D Systems (DDD)
Industry: Electronics
Industry RS rank: 7 out of 56
Stock RS rank: 279 out of 613
1/12/17 close: $15.65
1 Month avg volatility: $0.63. Volatility stop (for upward breakout): $13.59 or 13.2% below the close.
Change YTD: 17.76%
Volume: 2,714,200 shares. 3 month avg: 2,829,405 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: Pipe bottom reversal pattern from 12/27/2016 to 01/03/2017
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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Anadarko Petroleum Corp. (APC)
Industry: Petroleum (Producing)
Industry RS rank: 20 out of 56
Stock RS rank: 84 out of 613
1/12/17 close: $71.49
1 Month avg volatility: $1.51. Volatility stop (for upward breakout): $67.98 or 4.9% below the close.
Change YTD: 2.52%
Volume: 3,127,600 shares. 3 month avg: 4,510,651 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, right-angled and descending continuation pattern from 12/20/2016 to 01/12/2017
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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Cemex SA de CV (CX)
Industry: Cement and Aggregates
Industry RS rank: 17 out of 56
Stock RS rank: 131 out of 613
1/12/17 close: $8.03
1 Month avg volatility: $0.21. Volatility stop (for downward breakout): $8.48 or 5.6% above the close.
Change YTD: 0.00%
Volume: 10,238,100 shares. 3 month avg: 13,612,386 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: Rectangle bottom continuation pattern from 12/19/2016 to 01/12/2017
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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Continental Resources Inc. (CLR)
Industry: Petroleum (Producing)
Industry RS rank: 20 out of 56
Stock RS rank: 173 out of 613
1/12/17 close: $51.37
1 Month avg volatility: $1.66. Volatility stop (for downward breakout): $55.33 or 7.7% above the close.
Change YTD: -0.33%
Volume: 2,641,100 shares. 3 month avg: 2,855,638 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: Rectangle bottom continuation pattern from 12/15/2016 to 01/06/2017
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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CRH plc (CRH)
Industry: Cement and Aggregates
Industry RS rank: 17 out of 56
Stock RS rank: 146 out of 613
1/12/17 close: $34.65
1 Month avg volatility: $0.34. Volatility stop (for upward breakout): $33.76 or 2.6% below the close.
Change YTD: 0.79%
Volume: 533,300 shares. 3 month avg: 1,052,362 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: Triangle, ascending reversal pattern from 12/02/2016 to 01/12/2017
Breakout is upward 70% of the time.
Average rise: 35%.
Break-even failure rate: 13%.
Throwbacks occur 57% of the time.
Price hits measure rule target 75% of the time.

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Cummins Inc. (CMI)
Industry: Machinery
Industry RS rank: 12 out of 56
Stock RS rank: 155 out of 613
1/12/17 close: $138.56
1 Month avg volatility: $2.37. Volatility stop (for upward breakout): $129.31 or 6.7% below the close.
Change YTD: 1.38%
Volume: 2,600,300 shares. 3 month avg: 1,603,883 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Channel from 12/16/2016 to 01/11/2017

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DJ 15 Utilities (^DJU)
Industry: None
Industry RS rank is unavailable.
1/12/17 close: $657.77
1 Month avg volatility: $7.62. Volatility stop (for upward breakout): $638.37 or 3.0% below the close.
Change YTD: -0.28%
Volume: 37,986,000 shares. 3 month avg: 27,267,188 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: Channel from 07/22/2016 to 01/12/2017

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Equifax Inc (EFX)
Industry: Information Services
Industry RS rank: 36 out of 56
Stock RS rank: 512 out of 613
1/12/17 close: $120.86
1 Month avg volatility: $1.42. Volatility stop (for upward breakout): $116.33 or 3.8% below the close.
Change YTD: 2.22%
Volume: 508,600 shares. 3 month avg: 872,135 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: Channel from 12/07/2016 to 01/12/2017

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Everest Re Group Ltd (RE)
Industry: Insurance (Prop/Casualty)
Industry RS rank: 19 out of 56
Stock RS rank: 122 out of 613
1/12/17 close: $219.78
1 Month avg volatility: $2.77. Volatility stop (for upward breakout): $212.42 or 3.4% below the close.
Change YTD: 1.56%
Volume: 268,900 shares. 3 month avg: 308,911 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: Triangle, ascending reversal pattern from 12/14/2016 to 01/09/2017
Breakout is upward 70% of the time.
Average rise: 35%.
Break-even failure rate: 13%.
Throwbacks occur 57% of the time.
Price hits measure rule target 75% of the time.

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Hartford Financial Services Group Inc (HIG)
Industry: Insurance (Prop/Casualty)
Industry RS rank: 19 out of 56
Stock RS rank: 226 out of 613
1/12/17 close: $48.23
1 Month avg volatility: $0.64. Volatility stop (for upward breakout): $46.34 or 3.9% below the close.
Change YTD: 1.22%
Volume: 1,882,000 shares. 3 month avg: 2,415,637 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Rectangle top continuation pattern from 12/05/2016 to 01/12/2017
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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hhgregg, Inc (HGG)
Industry: Retail (Special Lines)
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 25 out of 56
Stock RS rank: 612 out of 613
1/12/17 close: $0.71
1 Month avg volatility: $0.09. Volatility stop (for downward breakout): $0.93 or 31.5% above the close.
Change YTD: -50.35%
Volume: 442,900 shares. 3 month avg: 152,206 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Dead-cat bounce continuation pattern from 01/10/2017 to 01/10/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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Iconix Brand Group Inc. (ICON)
Industry: Shoe
Industry RS rank: 50 out of 56
Stock RS rank: 32 out of 613
1/12/17 close: $10.15
1 Month avg volatility: $0.41. Volatility stop (for upward breakout): $9.08 or 10.5% below the close.
Change YTD: 8.67%
Volume: 1,124,200 shares. 3 month avg: 680,995 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: Rectangle top continuation pattern from 11/11/2016 to 01/12/2017
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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Infinera Corp. (INFN)
Industry: Telecom. Equipment
Industry RS rank: 13 out of 56
Stock RS rank: 594 out of 613
1/12/17 close: $8.70
1 Month avg volatility: $0.24. Volatility stop (for upward breakout): $8.11 or 6.8% below the close.
Change YTD: 2.47%
Volume: 1,097,100 shares. 3 month avg: 1,842,880 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: Triangle, symmetrical continuation pattern from 12/02/2016 to 01/12/2017
WARNING: A dead-cat bounce occurred on 07/28/2016. There is a 38% chance that a 15% or higher decline will occur (or has occurred since then) by 01/26/2017.
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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Insperity (NSP)
Industry: Human Resources
Industry RS rank: 18 out of 56
Stock RS rank: 513 out of 613
1/12/17 close: $70.60
1 Month avg volatility: $1.60. Volatility stop (for upward breakout): $66.90 or 5.2% below the close.
Change YTD: -0.49%
Volume: 84,600 shares. 3 month avg: 153,926 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Channel from 11/10/2016 to 01/12/2017

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Interactive Brokers Group Inc (IBKR)
Industry: Securities Brokerage
Industry RS rank: 1 out of 56
Stock RS rank: 286 out of 613
1/12/17 close: $38.68
1 Month avg volatility: $0.78. Volatility stop (for upward breakout): $36.87 or 4.7% below the close.
Change YTD: 5.94%
Volume: 432,900 shares. 3 month avg: 448,874 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 12/27/2016 to 01/03/2017
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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Lincoln National Corp (LNC)
Industry: Insurance (Life)
Industry RS rank: 2 out of 56
Stock RS rank: 15 out of 613
1/12/17 close: $66.54
1 Month avg volatility: $1.43. Volatility stop (for upward breakout): $62.31 or 6.4% below the close.
Change YTD: 0.41%
Volume: 948,100 shares. 3 month avg: 1,692,028 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 top continuation pattern from 12/12/2016 to 01/12/2017
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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Paychex Inc (PAYX)
Industry: IT Services
Industry RS rank: 35 out of 56
Stock RS rank: 376 out of 613
1/12/17 close: $61.34
1 Month avg volatility: $0.76. Volatility stop (for upward breakout): $59.19 or 3.5% below the close.
Change YTD: 0.76%
Volume: 1,070,200 shares. 3 month avg: 2,151,565 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 12/21/2016 to 01/11/2017
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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Principal Financial Group Inc (PFG)
Industry: Insurance (Diversified)
Industry RS rank: 14 out of 56
Stock RS rank: 54 out of 613
1/12/17 close: $58.87
1 Month avg volatility: $0.93. Volatility stop (for upward breakout): $56.14 or 4.6% below the close.
Change YTD: 1.75%
Volume: 1,551,500 shares. 3 month avg: 1,642,454 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 top continuation pattern from 12/16/2016 to 01/12/2017
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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Public Service Enterprise Group PEG (PEG)
Industry: Electric Utility (East)
Industry RS rank: 56 out of 56
Stock RS rank: 447 out of 613
1/12/17 close: $44.07
1 Month avg volatility: $0.62. Volatility stop (for upward breakout): $42.55 or 3.5% below the close.
Change YTD: 0.43%
Volume: 1,973,800 shares. 3 month avg: 2,744,722 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: Rectangle top continuation pattern from 12/16/2016 to 01/12/2017
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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Quaker Chemical (KWR)
Industry: Chemical (Specialty)
Industry RS rank: 16 out of 56
Stock RS rank: 59 out of 613
1/12/17 close: $128.35
1 Month avg volatility: $2.49. Volatility stop (for downward breakout): $134.72 or 5.0% above the close.
Change YTD: 0.32%
Volume: 85,000 shares. 3 month avg: 72,745 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Monday.
 
Chart pattern: Triangle, descending reversal pattern from 12/15/2016 to 01/12/2017
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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Scotts Miracle-Gro Co. (SMG)
Industry: Chemical (Basic)
Industry RS rank: 27 out of 56
Stock RS rank: 90 out of 613
1/12/17 close: $92.94
1 Month avg volatility: $1.40. Volatility stop (for upward breakout): $89.66 or 3.5% below the close.
Change YTD: -2.73%
Volume: 324,200 shares. 3 month avg: 567,342 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Rectangle top continuation pattern from 12/13/2016 to 01/09/2017
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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Sempra Energy (SRE)
Industry: Electric Utility (West)
Industry RS rank: 49 out of 56
Stock RS rank: 525 out of 613
1/12/17 close: $101.84
1 Month avg volatility: $1.74. Volatility stop (for upward breakout): $97.81 or 4.0% below the close.
Change YTD: 1.19%
Volume: 806,800 shares. 3 month avg: 1,283,788 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Friday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 12/13/2016 to 01/12/2017
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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Stratasys Ltd (SSYS)
Industry: Electronics
Industry RS rank: 7 out of 56
Stock RS rank: 585 out of 613
1/12/17 close: $18.84
1 Month avg volatility: $0.70. Volatility stop (for upward breakout): $16.83 or 10.7% below the close.
Change YTD: 13.91%
Volume: 418,600 shares. 3 month avg: 994,612 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Monday.
 
Chart pattern: Pipe bottom reversal pattern from 12/27/2016 to 01/03/2017
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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Texas Instruments Inc. (TXN)
Industry: Semiconductor
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 3 out of 56
Stock RS rank: 164 out of 613
1/12/17 close: $74.85
1 Month avg volatility: $1.00. Volatility stop (for upward breakout): $72.10 or 3.7% below the close.
Change YTD: 2.58%
Volume: 4,408,200 shares. 3 month avg: 5,203,314 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, ascending reversal pattern from 11/29/2016 to 01/12/2017
Breakout is upward 70% of the time.
Average rise: 35%.
Break-even failure rate: 13%.
Throwbacks occur 57% of the time.
Price hits measure rule target 75% of the time.

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United Technologies Corp (UTX)
Industry: Diversified Co.
Industry RS rank: 28 out of 56
Stock RS rank: 306 out of 613
1/12/17 close: $110.82
1 Month avg volatility: $1.19. Volatility stop (for upward breakout): $107.32 or 3.2% below the close.
Change YTD: 1.09%
Volume: 2,644,600 shares. 3 month avg: 3,362,035 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Channel from 11/14/2016 to 01/11/2017

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Verisign (VRSN)
Industry: Internet
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 9 out of 56
Stock RS rank: 445 out of 613
1/12/17 close: $81.00
1 Month avg volatility: $1.51. Volatility stop (for upward breakout): $76.92 or 5.0% below the close.
Change YTD: 6.48%
Volume: 556,200 shares. 3 month avg: 845,032 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening wedge, descending reversal pattern from 11/10/2016 to 01/10/2017
Breakout is upward 79% of the time.
Average rise: 33%.
Break-even failure rate: 6%.
Throwbacks occur 53% of the time.
Price hits measure rule target 79% of the time.

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YuMe Inc (YUME)
Industry: Advertising
Industry RS rank: 38 out of 56
Stock RS rank: 409 out of 613
1/12/17 close: $3.60
1 Month avg volatility: $0.14. Volatility stop (for upward breakout): $3.33 or 7.6% below the close.
Change YTD: 0.56%
Volume: 37,000 shares. 3 month avg: 65,717 shares.
This security may be thinly traded (less than 100k 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: Rectangle top continuation pattern from 12/09/2016 to 01/12/2017
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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DJIA short 1x ProShares (DOG)
Industry: Short ETFs
Industry RS rank: 54 out of 56
Stock RS rank: 510 out of 613
1/12/17 close: $18.91
1 Month avg volatility: $0.10. Volatility stop (for downward breakout): $19.23 or 1.7% above the close.
Change YTD: -0.68%
Volume: 779,400 shares. 3 month avg: 885,914 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: Rectangle bottom continuation pattern from 12/13/2016 to 01/12/2017
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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DJIA short 2x ProShares (DXD)
Industry: Short ETFs
Industry RS rank: 54 out of 56
Stock RS rank: 573 out of 613
1/12/17 close: $14.00
1 Month avg volatility: $0.15. Volatility stop (for downward breakout): $14.48 or 3.4% above the close.
Change YTD: -1.27%
Volume: 1,297,500 shares. 3 month avg: 1,298,454 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: Rectangle bottom continuation pattern from 12/13/2016 to 01/12/2017
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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iShares DJ US Regional Banks (IAT)
Industry: Long ETFs
Industry RS rank: 29 out of 56
Stock RS rank: 53 out of 613
1/12/17 close: $45.27
1 Month avg volatility: $0.63. Volatility stop (for upward breakout): $43.54 or 3.8% below the close.
Change YTD: -0.24%
Volume: 210,600 shares. 3 month avg: 287,972 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Rectangle top continuation pattern from 12/08/2016 to 01/12/2017
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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S and P Latin America 40 Index fund (ILF)
Industry: Investment Co. (Foreign)
Industry RS rank: 32 out of 56
Stock RS rank: 259 out of 613
1/12/17 close: $29.33
1 Month avg volatility: $0.40. Volatility stop (for upward breakout): $28.41 or 3.1% below the close.
Change YTD: 6.35%
Volume: 1,146,600 shares. 3 month avg: 1,974,643 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Broadening bottom reversal pattern from 11/22/2016 to 01/10/2017
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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Thursday 1/12/17. Intraday Market Direction: Nasdaq

The index climbed by 0.2% or 11.83 points. Since 02/05/1971 the index made 639 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.8% on 370 occasions.
     Average loss was -0.8% on 269 occasions.
Expect the index to close higher 57.9% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 120/207 or 58.0% of the time.
     The prediction of the index closing lower has been right 41/80 or 51.2% 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 chart shows two lines. Let's talk about the red one first.

I started drawing the line (A) from the lowest price on the chart, connecting the minor lows. Notice that recent price action has pierced the line, near B.

Now, it looks as if the index is pulling back to the trendline. If you look closely, you'll see that the index dropped to form a double bottom (C), completing the pullback during the drop from B to C.

The index has recovered and formed a valid double bottom, confirmed when the index closed above the peak between the two bottoms.

Now, the index is hitting overhead resistance setup by the prior two peaks. I show that resistance with a magenta line. I guess it's probably cyan in color.

But it looks like a triple top. That will only become a valid pattern when the index closes below the lowest valley between the three peaks.

That hasn't happened yet, of course.

$ $ $

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

-- Thomas Bulkowski

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© 2017 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  5,149.23    
 Monthly S1  5,356.44  207.21   
 Weekly S2  5,360.86  4.42   
 Monthly Pivot  5,446.48  85.62   
 Weekly S1  5,462.25  15.77   
 Weekly Pivot  5,499.39  37.13   
 Daily S2  5,510.54  11.15   
 Low  5,524.03  13.49   
 Daily S1  5,537.09  13.06   
 61.8% Down from Intraday High  5,539.33  2.24   Yes! The 61.8% Down from Intraday High is close to the Daily S1.
 50% Down from Intraday High  5,544.06  4.73   
 38.2% Down from Intraday High  5,548.78  4.73   
 Daily Pivot  5,550.59  1.81   Yes! The Daily Pivot is close to the 38.2% Down from Intraday High.
 Open  5,550.72  0.13   Yes! The Open is close to the Daily Pivot.
 Close  5,563.65  12.93   
 High  5,564.08  0.43   Yes! The High is close to the Close.
 Daily R1  5,577.14  13.06   
 Daily R2  5,590.64  13.49   
 Weekly R1  5,600.78  10.15   
 Weekly R2  5,637.92  37.13   
 Monthly R1  5,653.69  15.77   
 Monthly R2  5,743.73  90.04   

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