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

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Chart Patterns: After the Buy
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Busted
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Market
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
As of 07/18/2018
25,199 79.40 0.3%
10,702 239.10 2.3%
718 -3.22 -0.4%
7,854 -0.68 0.0%
2,816 6.07 0.2%
YTD
1.9%
0.8%
-0.8%
13.8%
5.3%
Tom's Targets    Overview: 07/13/2018
25,700 or 24,000 by 08/01/2018
11,000 or 10,000 by 08/01/2018
750 or 700 by 08/01/2018
8,000 or 7,500 by 08/01/2018
2,850 or 2,725 by 08/01/2018

  Written by and copyright © 2005-2018 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information. Some pattern names are the registered trademarks of their respective owners.

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Thursday 7/19/18. Intraday Market Direction: Nasdaq

The index dropped by 0.0% or -0.68 points. Since 02/05/1971 the index made 653 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.7% on 371 occasions.
     Average loss was -0.9% on 282 occasions.
Expect the index to close higher 56.8% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 148/268 or 55.2% of the time.
     The prediction of the index closing lower has been right 46/91 or 50.5% 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.

Today's chart looks a lot like the chart of the Dow two days ago.

This time, though, the rectangle top has a slight upward tilt to it. I suppose you can call it a channel, but it's flat enough for me. It doesn't matter much anyway.

The green pattern is called an ascending and inverted scallop. Price rises in an inverted fishing-hook shape. Price should rise after the end but it's struggling to do that as the chart shows.

I show two other scallops, in blue. These are wider than the green one. I found that when you see three progressively smaller scallops, like you see here, expect price to drop.

Oddly the reverse is also true: 3 scallops that get progressively wider. Both configurations are rare, though.

So maybe we'll see the index drop in the coming days.

$ $ $

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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© 2018 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  7,281.88    
 Monthly S1  7,568.16  286.28   
 Weekly S2  7,651.24  83.08   
 Monthly Pivot  7,705.84  54.60   
 Weekly S1  7,752.84  47.00   
 Weekly Pivot  7,798.18  45.34   
 Daily S2  7,806.07  7.89   
 Low  7,822.83  16.76   
 Daily S1  7,830.26  7.43   
 61.8% Down from Intraday High  7,838.47  8.21   
 50% Down from Intraday High  7,843.30  4.83   
 Daily Pivot  7,847.01  3.71   Yes! The Daily Pivot is close to the 50% Down from Intraday High.
 38.2% Down from Intraday High  7,848.13  1.12   Yes! The 38.2% Down from Intraday High is close to the Daily Pivot.
 Close  7,854.44  6.31   
 Open  7,859.43  4.99   
 High  7,863.77  4.34   
 Daily R1  7,871.20  7.43   
 Daily R2  7,887.95  16.76   
 Weekly R1  7,899.78  11.83   
 Weekly R2  7,945.12  45.34   
 Monthly R1  7,992.12  47.00   
 Monthly R2  8,129.80  137.68   

Wednesday 7/18/18. 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 vertical green bar on the far right says the indicator remains bullish.

Notice the U-shaped dip in the indicator (the thin blue line near chart bottom, to the right of the green line). That suggests weakness, I think.

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).

Shown as a red line on the above chart...
On Tuesday, 22% of stocks in my database are in bear market territory (down at least 20% from their 1-year high).
A week ago, it was 22%.
The fewest was 16% on 01/26/2018.
And the most was 33% on 04/02/2018.
Shown as a blue line on the above chart...
The 509 stocks in my database are down an average of 13% from their yearly high.
A week ago, the average was 13%.
The peak was 9% on 01/22/2018.
And the bottom was 19% on 02/08/2018.

Neither line has budged from a week ago.

I think that means the index is in a trading range (not trending).

It also suggests the index is going to move soon. That is, a period of high volatility follows a period of low volatility. Maybe earning's reports will cause market turbulence.

-- Thomas Bulkowski

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Tuesday 7/17/18. Intraday Market Direction: Dow

The index climbed by 0.2% or 44.95 points. Since 10/01/1928 the index made 1302 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.6% on 710 occasions.
     Average loss was -0.5% on 592 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 163/277 or 58.8% of the time.
     The prediction of the index closing lower has been right 34/68 or 50.0% of the time.

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

Picture of the Dow industrials on the 5 minute scale.

$ $ $

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

Notice how the index moved horizontally for much of the past two days. That horizontal movement is called a rectangle, a rectangle top, to be exact.

Price bounces between horizontal or nearly horizontal lines...until it decides to trend. That's what we could be seeing now.

I drew the top line thinner so you could see that the index appears to have pierced the top trendline. That suggests, but does not guarantee, the direction of the new trend (upward).

$ $ $

I updated performance statistics on bump-and-run reversal bottoms. It's a complicated pattern but it performs well, much to my surprise.

$ $ $

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

-- Thomas Bulkowski

Top

© 2018 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  23,415.85    
 Monthly S1  24,240.10  824.26   
 Weekly S2  24,350.55  110.45   
 Weekly S1  24,707.46  356.90   
 Monthly Pivot  24,821.47  114.01   
 Weekly Pivot  24,875.33  53.87   
 Daily S2  24,946.03  70.70   
 Low  24,979.64  33.61   
 Daily S1  25,005.20  25.56   
 61.8% Down from Intraday High  25,015.08  9.88   
 Open  25,025.58  10.50   
 50% Down from Intraday High  25,026.03  0.45   Yes! The 50% Down from Intraday High is close to the Open.
 38.2% Down from Intraday High  25,036.97  10.95   
 Daily Pivot  25,038.80  1.83   Yes! The Daily Pivot is close to the 38.2% Down from Intraday High.
 Close  25,064.36  25.56   
 High  25,072.41  8.05   Yes! The High is close to the Close.
 Daily R1  25,097.97  25.56   
 Daily R2  25,131.57  33.61   
 Weekly R1  25,232.24  100.66   
 Weekly R2  25,400.11  167.88   
 Monthly R1  25,645.72  245.61   
 Monthly R2  26,227.09  581.36   

Written by and copyright © 2005-2018 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information. Some pattern names are the registered trademarks of their respective owners.