23
Apr

FT: The new world of Mifid II

Mifid II is done but not dusted – the technical standards defining the laws are still to be written. Judith Hardt, director-general of the Federation of European Securities Exchanges, explains why this is a defining moment for Europe’s markets.

FT Trading Room

22
Apr

April 22 Breakout Trend Day Breadth Update and Stock Scan

With price breaking through resistance and defying divergences, let’s take a look at Sector Breadth (what’s strong, what’s weak) along with the top trending stocks of the day.

We’ll start as usual with Sector Breadth:

There’s a big push-pull situation where Bullish Days show strength in the Offensive/Risk-On Sectors such as Financials, Discretionary/Retail, Tech, Materials and Industrials.

We’ve also seen Energy outperform other sectors, though Bearish days show strength in Staples and Utilities (and Energy).

Today’s session – an alternate thesis bullish breakout – has resulted in one-sided buy-dominant price action as shown above with strength in the Offensive/Risk-On Sectors.

We have four of the top “trend day” stock candidates listed below from our scan:

While Netflix (NFLX) is gapping higher along with other stocks, our scan detected the following stocks, two of which had an opening gap that held strength so far (unlike Netflix):

Earnings Gappers Allergen (AGN), and Harley Davidson (HOG) join strong trenders Legg Mason (LM) and Lowe’s Corp (LOW) for our top candidates.

For those brave trading souls who want to go against money flow and a short-squeeze crushing the bears on a breakout, we have four candidates for potential intraday downtrend continuity:

Pentair (PNR), Allegheny Tech (ATI), Lockheed Martin (LMT) and Alliance Data Systems (ADS).

Be sure to incorporate today’s action into our two scenarios (clearly, the bullish scenario won the day):

Are We Really Repeating this Pattern in the S&P 500 Again?“  (probably, yes)

S&P 500 Range Reference and Market Internal Update – April 21” (overruled)

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Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).


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21
Apr

April 16 Bullish Sector Breadth and Trending Stocks

Apr 16, 2014: 1:10 PM CST

We finally have broad bullish sector breadth for today’s bullish bounce session.

Let’s take a look at S&P 500 Sector Breadth and the current trending stock candidates:

In the previous bullish bounce sessions, we’ve seen “caution” signs coming from sector strength in Utilities and Energy.

This time, we see broad bullish breadth where Industrials ($ XLI) lead the pack along with Staples.

However, all sectors are showing dominance today except Health Care ($ XLV) where 44% of stocks are up on today’s session.

The broad participation suggests likely additional upside price action (that’s the hope at least).

With that in mind, let’s scan for leading stocks that may continue in the trending session:

General Mills (GIS – a Consumer Staples stock), Eastman Chemical (EMN), Valero Energy (VLO), and PraxAir Inc (PX) provide potential trend day continuation candidates.

Today’s “trend fighting” downtrending stock candidates – for those who like to fight the tide – include CSX Corp (CSX), NetApp Inc (NTAP), TransOcean (RIG), and United Health Group (UNH – remember Health Care is the worst performing sector today).

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Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).


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19
Apr

Utilities and Stocks Breaking to New 52 Week Highs

Apr 16, 2014: 6:05 PM CST

Sometimes the simplest things are effective for finding candidates to trade on a short-term or intraday basis.

For example, if you want to identify strong stocks that are likely uptrending – and may continue to do so – scan for stocks bursting to new 52-week highs in an uptrending market (particularly in strong sectors).

Let’s take a look at the current list of candidates of the 41 stocks that registered new 52-week highs in today’s bullish session.

The 41 stocks above (of the 500 stocks in the S&P 500 list) carved out new 52-week highs today.

You can put them in a scan list and quickly study their charts for steady uptrends and potential trading (retracement) candidates.

Do additional analysis on the stocks that show the most potential according to your trading style.

I separated the Utilities ($ XLU) stocks with yellow highlights to note that 16 of the 41 stocks are “Risk-off” or “Defensive” stocks in the Utilities sector.

Here’s a chart of the broader XLU Utilities ETF (note the uptrend and dominant price action into the highs):

That’s generally not something you want to see if you expect the broader market to continue power-trending higher.

Nevertheless, use this quick, simple scan to find potential pro-trend relative strength candidates.

Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).


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17
Apr

April 17th Utilities Collapse Intraday Breadth Update and Stock Scan

What a difference a day makes!

In yesterday’s mid-day update, I highlighted a broader bullish signal from breadth, namely from weakness in utilities and strength in all other sectors.  The suggestion was that price would likely continue higher.

With today’s session another gap-up and trend event (so far), we saw that signal fulfilled; however, on today’s update on Breadth, we see a collapse of strength in Utilities!

Let’s take a look at the Sector Breadth and view our top trending stocks for today’s session:

I conducted a simple scan for stocks trading at new 52-week highs as of yesterday’s session and highlighted the concentration of Utility Sector stocks in the list.

Today’s intraday session reveals a collapse in the strength of utilities as well as Treasuries/bonds which are also falling sharply during today’s session.

Nevertheless, as has been the case for the last few sessions, Energy ($ XLE) is again one of the top sectors in terms of relative strength/stock breadth.

It’s interesting to see a stair-step progression in terms of money flow across the sector groups as we see above.

Look to concentrate your attention in Materials, Industrials, and Energy stocks should the broader trend continue.

Here are our four leading stock (trending) candidates for today’s session as of mid-day:

Hasbro Inc (HAS), Lorrilard (LO – a repeat performer), Chesapeake Energy (CHK), and Chevron Corp (CVX).

Instead of select the top four stocks from our algorithmic scan for relative strength, I wanted to highlight something interesting:

This is the scan data from an algorithm/formula I use in TradeStation.  The stocks listed above top the list of “strongest intraday downtrend” or relative weakness so far in today’s session.

What fascinates me is that seven of the top ten downtrending candidates are Financial Sector companies.  Given the sector performance grid above, I would have expected to see more Utilities or Consumer Staples stocks but that’s not the case from the scan data above.

The rogue stock names today include Philip Morris (PM), IBM, and Bed Bath & Beyond (BBBY).

You can take a look at each of these stocks to see if any of them match your criteria for intraday trend trading candidates.

Remember, when using these type of scans, look beyond individual stocks (or even sectors) to find patterns of broader money flow.

Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).


Afraid to Trade.com Blog

16
Apr

FT: Regulating in the dark

Trading, technology and markets are back in focus. Richard Balarkas, Quendon Consulting managing director, explains to FT Trading Room editor Philip Stafford how speed has changed trading and why regulators find market infrastructure hard to simplify.

FT Trading Room

16
Apr

Tax Day Bearish Sector Breadth and Stock Scan

April 15th brings a lunar eclipse (blood moon) and “tax day.”

Putting those things behind us, let’s take a look at our intraday update for S&P 500 Sector Breadth and identify which stocks may provide trend day trading candidates in the event we see a similar session to yesterday’s trading day.

For yesterday’s update, I titled it “Bullish Sector Breadth with Caution” because sector strength revealed Utilities and Energy topping the otherwise bullish session.

The caution was correct, as we saw a mid-day reversal which was the same situation we saw with this morning’s “cautious” sector breadth.

The mid-day graph paints another bearish picture of money flowing into defensive sectors such as Utilities and Energy with our third place finish going to Financials.

At the moment, 80% of Dow Jones stocks are down on the session while 70% of S&P 500 stocks are negative at this moment.

We’ll turn now to our potential bearish trend day continuation candidates first:

We continue to see an appearance by Intuitive Surgical (ISRG) which I highlighted on a “trap and gap” educational post last week.  The trap triggered and price continued to collapse lower.

ISRG is joined by downtrending candidates Stryker Corp (SYK), Petsmart Inc (PETM), and Wynn Resorts (WYNN).

Should the market stage an end-of-day magical reversal like yesterday, you may want to concentrate on the top intraday trending stocks at the moment which include Ameren Corp (AEE), Teco Energy (TE), Public Services (PEG – back again), and a name you don’t see often – Stanley Black & Decker (SWK).

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Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).


Afraid to Trade.com Blog

14
Apr

Seven New 52 Week Highs and One New Low for April 14

Apr 14, 2014: 1:14 PM CST

Following-up on this morning’s intraday Breadth and Trending Stock Scan update, let’s take a quick look at the seven stocks pushing to new 52-week highs and the one lonely stock breaking to a new 52-week low on today’s bullish support bounce intraday session.

April 14 52 week high low scan

The following stocks pushed to new 52-week highs today, as seen on the grid above:

Archer-Daniels Midland (ADM), Allegheny Tech (ATI), DTE Energy (DTE), Newfield Exploration (NFX), Public Service Enterprise Group (PEG), SCANA Corp (SCG), and Spectra Energy (SE).

One lone stock – so far – broke to a new 52-week low: Rowan (RDC).

At the moment, Rowan (RDC) is bouncing up from a weak open to develop a strong intraday bullish session.

Otherwise, study the charts of the seven stocks hitting new 52-week highs for potential pullback or breakout continuation opportunities.

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Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).


Afraid to Trade.com Blog

13
Apr

April 11 Breakdown Sector Breadth and Trending Update

Apr 11, 2014: 12:35 PM CST

With the broader market breaking a key support level this morning, let’s take a quick look at mid-day Sector Breadth and view the results of our Trending Stock Scan candidates.

Here’s current Bearish/Breakdown Sector Breadth:

We’re seeing another clear example of Bearish Breadth where the strongest sector is Utilities ($ XLU) followed by Energy ($ XLE).

All other sector breadth readings show roughly 15% of each sector’s stocks are positive on the session.

In fact, 83% of all stocks in the S&P 500 are negative on the session mid-day.

This brings us to our bearish intraday trending stock candidates for additional short-selling opportunities:

Fastenal Co (FAST), Teradata Corp (TDC), Jacobs Engineering (JEC) and a stock I highlighted on Wednesday – Intuitive Surgical (“Gaps and Traps with Breaks and Fakes for ISRG“) top our downtrending list.

I was unable to find four clean uptrending stocks today, so I narrowed the list to these two:

If you simply can’t resist going against the trend of intraday money flow, then C.H. Robinson (CHRW) and ConocoPhillips (COP) are showing relative strength and intraday uptrends at the moment.

Unless we see another stellar intraday reversal, continue focusing on the relative weakness names and shorting them as the sell-off continues.

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Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).


Afraid to Trade.com Blog

11
Apr

Essential April Fibonacci Retracement Levels for Dow NASDAQ and SPX

With the US Equity Markets correcting lower against recent highs, let’s take a moment to update our short-term Fibonacci Retracement Reference levels and note something very interesting about how far the NASDAQ has fallen.

We’ll start with the S&P 500 levels:

SPX Fibonacci Retracement Trading levels

The S&P 500 is stair-stepping lower, starting with the 38.2% Fibonacci Retracement level which formed the lower bound of the recent rectangle pattern.

The recent breakdown under the 1,840 (1,837) reference level led immediately to a successful test of the midpoint or 50% level into 1,820.  Note the current intraday rally back to the underside of the 1,837 level.

The next short-sell trigger will be a breakdown event under 1,818.50 (target 1,800).  Keep these levels in mind.

Next, the levels in the Dow Jones Industrial Average are similar (in structure):

Dow Jones Fibonacci Reference Levels

With the pattern similar to the S&P 500, we’ll focus on the 16,145 level (38.2%) along with the current 16,000 confluence.

A failure or breakdown under 16,000 opens a quick sell-off (open air) pathway toward 15,850.

The most interesting chart – in comparison – is the NASDAQ Index:

NASDAQ COMPX COMPQ Fibonacci Retracement Reference Levels

We can use Fibonacci Retracement Levels to compare similar markets (or ETFs).

For example, while the S&P 500 and Dow Jones break the 38.2% and challenge the 50% or “midpoint” Fibonacci levels, the NASDAQ has already shattered the 61.8% level and almost retraced a full 100% to the prior low carved out in February.

Namely, we’ll be focusing on the “round number” 4,000 level.

Note how price has already stair-stepped each of the three main Fibonacci Levels (4,221, 4,175, then 4,130).

Bookmark this page and keep these reference levels handy when planning intraday or swing trades.

Afraid to Trade Premium Content and Membership

Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

Corey’s new book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).


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