BlueWolf’s Weekly Market Sentiment (New and Improved with Better Flavor!)

[Louetta]

Good day today (Thursday) for your stuff.

[BlueWolf]

The problem with the stocks I invest in is that they are, for the most part, growth stocks. Many of them therefore trade at extremely high valuations (based on future earnings). When the hamster wheel slows down, they are often the first stocks to sell off. That’s why I usually have a few “defensive” stocks like BRK/B, FICO, MA, and V, although, as we have seen, the financial industry can have its own melt downs. In the end, there isn’t a real good short term defense against a recession. You either trade in and out, or buy stocks you believe in for the long term and ride the bear markets out.

[BlueWolf]

Market Sentiment for the week ending October 11, 2019

Short Term Bias:Neutral
Long Term Bias: Neutral

I have included an annotated daily chart for the NASDAQ. The S&P and Dow are similar.

To be honest, my bearish apprehensions from a week ago haven’t really gone away despite two solidly bullish days at the end of the week. The problem is that it is still unclear whether the market truly pivoted back to the upside last week. If you draw a (downward) regression channel over the bars of the last week or so, you can see that the bullish action of the last two days of last week still fall within the channel. There is therefore a good possibility that the markets will reverse themselves here, stay within the regression channel, and challenge the August pivot low. Let’s put on our optimist hat for a second. In that case, we could be witnessing the formation of a higher (than August) pivot low, which is a characteristic of an upward trend. In this rosy scenario, the quick correction that formed the early August low bottomed out at the pivot and has been clawing its way back up ever since. Of course, extreme volatility has made this less clear. If that’s what’s happened, of course. For me, I’ll have to wait and see. I need more data to get a good gauge on what is up with the market. My short and long term bias is therefore neutral, and I will trade with extreme caution this week, if I trade at all.

Annotated Daily Chart for the NASDAQ:
https://www.dropbox.com/s/3d1gm4bpsd...%20PM.jpg?dl=0

The funny thing is that I just didn’t find any short setups that I liked going into this week. Does that tell me something? Maybe. In any event, if I haven’t said it before, please keep in mind that the following stocks are just watchers. I don’t trade them until I get some kind of specific setup or signal, e.g. certain kinds of intraday candlestick patterns, breaking of support/resistance levels, etc. So please don’t ever take any of these watchers as recommendations to buy/sell at the open. Having said all that, here are a few stocks I will be watching early in the week:

Long: CGNX (I previously owned this as a long term hold and want to again at some point), KNSL, NEE, REAL, WIX
Short: -

Good luck with your trading and investing.

[BlueWolf]

No Sunday update this week due to family shindig. I’ll try to post something early in the week, but it’s going to be a very busy week for me.

[BlueWolf]

Mid Week Update for the week ending October 11, 2019

Mid Week Update for the week ending October 11, 2019

Short Term Bias:Bearish
Long Term Bias: Bearish

I have included an annotated daily chart for the NASDAQ. The S&P and Dow are similar.

Despite the bullish action of the last five bars of the indices, I have taken on a bearish disposition. This stems from the appearance of a descending triangle, which is a bearish pattern, on the daily charts. Right now, the indices are hovering right at the upper bounds of this triangle with topping tails possibly foreshadowing a rollover. This is why my short term and long term bias has switched from neutral to bearish. I truly hope this pattern doesn’t play out, but I cannot deny that it’s there simply because I want my positions to go up. In any event, I remain nervous about being back in the market, and I would sure love to see the indices obliterate the top from early September. That would give me a nice, warm, longer term bullish feeling. 😉

Annotated Daily Chart for the NASDAQ:
https://www.dropbox.com/s/l6jpuyfcy5...%20PM.jpg?dl=0

I did do a few short term trades at the beginning of the week including WD and ANSS. I kind of like both of these companies as possible longer term holds or swing trades, but I don’t want to add any more long term positions right now, so I was in and out. No shorts this week so far.

Good luck to everyone with their trades and investments.

[Louetta]

Interesting analysis.

[BlueWolf]

Market sentiment for week ending October 25, 2019

Market sentiment for week ending October 25, 2019

Short Term Bias:Bearish
Long Term Bias: Bearish

I have included an annotated daily chart for the NASDAQ. The S&P and Dow are similar.

There isn’t much new to report this week. All three of the major indices continue to form a descending triangle with implications that the market is headed lower. The NASDAQ, in particular, followed the script closely, conveniently rolling over right at the upper trend line of the triangle. Despite a bit of a bottoming tail on Friday in the NASDAQ (there was no such tail in the DOW which closed near the LOD), I still believe there is more bearishness to come, hence my short and long term bearish bias.

Annotated Daily Chart for the NASDAQ:
https://www.dropbox.com/s/65pk3l7t4o...81%29.jpg?dl=0

Despite the general bearishness to end the week, I did manage to find a few long setups along with some juicy looking shorts should the market continue its bearish ways. Here are some stocks I will be watching for day and swing trading opportunities at the start the week.
Longs: AMT, APPF, INVH, STT
Shorts: ADNT, AJRD, BOX, CORT, EOG

Good luck with your trading and investing.

[BlueWolf]

Added title

Market sentiment for week ending November 1, 2019

Short Term Bias:Cautiously Bullish
Long Term Bias: Neutral

I have included annotated daily charts for the NASDAQ, S&P, and Dow.

What a difference a week makes. As if the volatility wasn’t hard enough to deal with, now we have divergences in the three indexes. Let’s start with the NASDAQ. At the beginning of the week the NASDAQ looked poised to roll over at the upper trend line of a descending triangle. During the week, however, it consolidated sideways and then had a breakout bar. This bar not only penetrated the upper trend line of the descending triangle, it also took out the prior pivot high by the smallest of margins. Is the descending triangle now a broken pattern? Is the bearishness over for now? I think it’s too early to say for sure. I’d like to see some confirmation such as a bar that opens and closes above the upper trend line. Whatever the case, Friday’s action formed a strong, bullish bar, and the absence of any kind of topping tail suggests that their might be more bullishness to come, at least in the short term. Hence my short term bias is cautiously bullish.

Now for the S&P. The price action in the S&P also seems to be operating within the confines of a triangle, but in this case it is an ascending triangle, i.e. a bullish pattern. Note how the highs have tested the July peak twice. Currently, it’s only $0.69 from setting a new all time high. The Dow and NASDAQ are not even close. Friday’s bar is not quite as impressive as the NASDAQ’s equivalent bar, and there is a little more of a topping tail, but it engulfed the previous bar. All of this points to bullishness in the S&P, which is, hands down, the most bullish of the three indices.

Finally, the Dow.The price action in the Dow once again seems to operating within the confines of a triangle. In this case, however, it looks like a symmetrical triangle with lower pivot highs and higher pivot lows. As opposed to the bearish descending triangle on the NASDAQ, and the bullish ascending triangle on the S&P, this symmetrical triangle is a neutral pattern and simply represents some kind of consolidation. Friday’s bar on the Dow was not that impressive as it failed to take out either of its prior two pivot highs. Both the NASDAQ and the S&P took out their prior highs.

So what does all of this mean? I really don’t know. The net sum of all things seems modestly bullish to me, but I don’t like these strange divergences, particularly between the Dow and the other two indices. My long term bias is therefore neutral until we get more data.

Annotated Daily Chart for the NASDAQ:
https://www.dropbox.com/s/juoukyshu8...%20PM.jpg?dl=0
Annotated Daily Chart for the S&P:
https://www.dropbox.com/s/2kc5bgch2b...%20PM.jpg?dl=0
Annotated Daily Chart for the Dow:
https://www.dropbox.com/s/35pifr3gxh...%20PM.jpg?dl=0

Here are some stocks I will be watching for day and swing trading opportunities at the start the week. I kind of like the short setups better than the long setups, but when I day trade it is always with the direction of the market so if the market heads up, I won’t be shorting.
Longs: AAL, ADVM, MIK, NEE , STT
Shorts: CUBE, MXL, NOC, PFPT, PSA,

Good luck with your trading and investing.

[BlueWolf]

Market sentiment for week ending November 8, 2019

Market sentiment for week ending November 8, 2019

Short Term Bias: Bullish
Long Term Bias: Bullish

I have included annotated daily charts for the NASDAQ. The S&P and Dow are similar with one divergence in the Dow.

The bullish confirmation I was looking for after the prior week came immediately as the market gapped up on Monday, opening and closing above the descending triangle’s upper trend line. The market spent the rest of the week consolidating, creating a bullish basing-at-the-high pattern. My short term bias is therefore bullish.

On a longer term scale, there are indications that there is more upside to come. The NASDAQ and S&P both made new all time highs. The Dow did not, but on Friday it posted a solid bullish bar that closed at the High of the Day (HoD). It should make a new all time high soon. All three indices have broken out above their triangle patterns which portends more to upside come. On an interesting note, I was looking at past patterns in the indices and I noticed that the current price pattern in the NASDAQ is very similar to a pattern it formed in the middle of 2018. There is one significant difference: The 2018 pattern did not come off an all time high and actually formed after a significant correction. What is surprisingly similar, however, is how the index has crept back up in both cases. If the current pattern continues to match the progression from 2018, there is significantly more upside to come. My long term bias has therefore returned to bullish. I do have a couple of caveats. First, any further upward movement is likely to be choppy as volatility will very likely continue to shake things up. Second, if the early 2018 pattern plays out in the long term, the next leg up will be followed by a major correction. Will this be one? Will this be the long term bear market everybody is expecting? I don’t know. What I do know is that it won’t take much to send this market over a cliff. Should we get a string of bad economic indicators and/or bad earnings, I’m guessing investors are going to starting looking for the exits. We’ll see. For the time being, I’m bullish and I do expect more upside in the immediate future.

Annotated Daily Chart for the NASDAQ:
https://www.dropbox.com/s/vfxs4sxp4h...%20PM.jpg?dl=0

Here are some stocks I will be watching for day and swing trading opportunities at the start the week.
Longs: BB, FAST, IIVI, KIM, REZI, RGEN, TCF
Shorts: PSA, UNIT

Good luck with your trading and investing.

[BlueWolf]

Market sentiment for week ending November 15, 2019

Market sentiment for week ending November 15, 2019

Short Term Bias: Bullish
Long Term Bias: Bullish

I have included annotated daily and monthly charts for the NASDAQ and an annotated daily chart for the DOW. The S&P is mirroring the NASDAQ.

The indices all gapped up at the start of the week and then spent the rest of the week consolidating their gains. The NASDAQ and the S&P both ended the week with bullish engulfing bars, which I believe portends more short term bullishness.

For the longer term, I took a step back and looked at the monthly charts for the indices. What I saw, for the most part, were indices that had spent the last year and a half in a sloppy, i.e. highly volatile, consolidation. I saw a similar consolidation in the late 2014 to early 2016 period after which the indices took off for a wild ride up. Are we poised for a major leg up? Maybe. My long term bias remains bullish, but given the volatility we have seen, a few jinks on the way up wouldn’t surprise. At some point, however, the indices have to establish a clear trend, and I still see more upside coming.

Annotated Daily Chart for the NASDAQ:
https://www.dropbox.com/s/ycjz9v6kzw...%20AM.jpg?dl=0

Annotated Monthly Chart for the NASDAQ:
https://www.dropbox.com/s/8e99obw428...%20AM.jpg?dl=0

Annotated Daily Chart for the Dow:

https://www.dropbox.com/s/75051uv85dulw2n/Photo%20Nov%2010%2C%204%2034%2058%20PM.jpg?dl=0

I didn’t see many setups that I loved going into the new week, but here are some stocks I will be watching for day and swing trading opportunities at the start the week.
Longs: APTV, ARWR, EB, MOH, QCOM, RLGY
Shorts: BRFS, FOSL, LCI

Good luck with your trading and investing.

[Louetta]

Always like to look at the Advance/Decline line. Still sees to be marching along nicely:

https://stockcharts.com/h-sc/ui?s=!ADLINESPX&p=W&yr=3&mn=0&dy=0&id=p73367671490

[BlueWolf]

Always like to look at the Advance/Decline line. Still sees to be marching along nicely:

https://stockcharts.com/h-sc/ui?s=!A...d=p73367671490

A very useful metric.

[jiesen]

Always like to look at the Advance/Decline line. Still sees to be marching along nicely:

https://stockcharts.com/h-sc/ui?s=!A...d=p73367671490

I always like the 3-year charts better than the 1-year charts.... because I see my name 3x as often in those!

-Jason

[Louetta]

I always like the 3-year charts better than the 1-year charts.... because I see my name 3x as often in those!

-Jason

Then you should enjoy this 5 year even more. But there is a real purpose in displaying this one because, methinks, it shows the difference clearly twixt the rocky market of 2015-early 2016 and the bull market since then and the clear continuation, I think, of that bull market into the present...

OK, so far I can't get it to display properly here but if you go down to the chart attributes block in the one I posted above and change the years parameter to 5 from 3 and hit update in the chart attributes block it should work.

[wifwif]

This is very simular to the argumentation of fibtimer.

They see the NYSE Advance/Decline Line in the current market environment as the most important indicator for the market direction.

Thus fibtimer is currently bullish on all stock markets (SPX, NDX, Russell 2000, iShares MSCI EAFE - EFA) from conservative as well as more dynamic view.