Technical Analysis of STOCKS & COMMODITIES
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Article Archive For Ron Walker
DownloadDo The Math The RSI Way
ARTICLE SYNOPSIS ...Even though there are scores of indicators, the relative strength index and the divergence still work....
A Head & Shoulders Top Awaits Confirmation On The Russell 2000
ARTICLE SYNOPSIS ...A head & shoulders top on the Russell 2000 could be hinting that a major top is setting up in the market....
Trading A 1-2-3 Trend Reversal
ARTICLE SYNOPSIS ...Spotting a trend reversal is as easy as 1-2-3....
The Russell 2000 Breaks Support
ARTICLE SYNOPSIS ...A temporary top appears to be forming on the Russell 2000 as it sinks below support....
Danger! Market Breadth Is Deteriorating!
ARTICLE SYNOPSIS ...Remember the robot from the 1960s classic TV show, "Lost in Space"? The robot always gave warnings, using phases like "Warning!" and "Danger!" Market breadth is the B-9 robot in technical analysis. It warns us when danger is present, even when we are unaware of the impending threat....
The VIX Triggers A New Sell Signal
ARTICLE SYNOPSIS ...The VIX is known as the fear gauge and is a contrarian indicator. It is a yardstick that measures the markets expectations of near-term volatility. The recent low readings on the VIX suggests that there are too many bulls, which means that the buying power is nearly exhausted, which hints of trouble ahead for the stock market....
The Contrarian Put/Call Ratio
ARTICLE SYNOPSIS ...A trader who thinks outside the box can bet against the crowds when they become irrational, and the put/call ratio can tell you how....
Working Money: The Contrarian Put/Call Ratio by Ron Walker
Short Setups For The S&P 500's Head & Shoulders Top
ARTICLE SYNOPSIS ...The classic head & shoulders pattern has a very high success rate, triggering the expected result 74% of the time. What's it say about the market ahead?...
The VIX Hints Of Irrational Exuberance
ARTICLE SYNOPSIS ...A bullish P-p-P pattern on the MACD histogram hints that volatility is on the rise. But market sentiment remains very bullish at these levels as the indexes make fresh highs, drawing the bulls into a false sense of security....
A Shooting Star For Bank Of America
ARTICLE SYNOPSIS ...The primary momentum indicator should always be price. To measure true momentum in price, many technical traders turn to candlesticks to help predict market direction for both long- and short-term periods....
Intraday Short-Term Trading Tactics by Ron Walker
ARTICLE SYNOPSIS ...Intraday Short-Term Trading Tactics by Ron Walker Enter and exit trades the right way based on familiar chart patterns. wing trading prospects occur when price patterns form. Even though traders might be familiar with many chart patterns, they may not know how to enter and exit trades correctly based on those price patterns. Our purpose here is to discover short-term trading strategies that will help fine-tune entry and exit points while properly assessing stops. I'll illustrate some attractive setups using the hourly chart of the ProShares UltraShort for the Standard & Poor's 500 (Sds). T...
Bullish Belt Holds Bolster A Bottom
ARTICLE SYNOPSIS ...A series of bullish candlesticks hints that we may have reached capitulation and that the market could be setting up a double-bottom pattern....
The Short- And Long-Term Trading Itinerary For The S&P 500
ARTICLE SYNOPSIS ...The S&P 500 looks poised to rally for the short term, but such a rally may prove to be its demise over the long term, should a large head & shoulders pattern form on the daily chart....
The Moving Average Trio
ARTICLE SYNOPSIS ...By incorporating a trio of moving averages into a 15-minute price chart, traders can be alerted to strong signals when the market is gaining or losing momentum. Using this system allows a trader to capture the sweet spots when momentum is gaining or waning....
McClellan Summation Index 101 - Divergences
ARTICLE SYNOPSIS ...The McClellan summation index for the NYSE just completed a bearish divergence, and traders got the confirmation as it crossed below the 10-day moving average triggering a bearish signal. Meanwhile, the summation index was also grinding through a bearish head & shoulders topping pattern....
The Histogram And A Hollow Red Candlestick Heighten Volatility
ARTICLE SYNOPSIS ...When the VIX, a contrarian indicator of the stock market, turns bullish, that implies that volatility in stock market is on the rise. A bullish P-p-P on the VIX's MACD histogram and a hollow red candlestick could cause more nail-biting among those who are still bullish on the market....
A Dark Cloud Cover Over The Health Care ETF
ARTICLE SYNOPSIS ...The health care exchange traded fund has recently had an explosive move higher as the politicians battle it out over health care. Even though there is no bipartisan support for the health care bill, there has been bipartisan support among investors to run up the health care ETF. But with the most recent thrust upward, and speculation about the bill dying, traders might be wise to apply the old strategy of "Buy the rumor, sell the news."...
A Head And Shoulders Top On The NASDAQ A/D Line?
ARTICLE SYNOPSIS ...The A/D line is an effective gauge in determining the overall strength of the stock market. It is by far the most commonly used measure of market breadth....
Three Signals Are Better Than One
ARTICLE SYNOPSIS ...Correlating signals in multiple time frames increases the odds of a successful trade. Selecting a quality setup, like a reversal chart pattern in a micro time frame along with it, offers a trader endless opportunities to create wealth and protect capital....
Starbucks Undergoes A Test
ARTICLE SYNOPSIS ...Lower peaks in the MACD histogram and rate of change reveal that momentum to the upside is beginning to wane for Starbucks, the largest coffee shop chain in the world, causing SBUX to undergo a test of its rising trendline and 20-day MA....
Will A 1-2-3 Trend Reversal Mark The Top For The S&P 500?
ARTICLE SYNOPSIS ...Identifying price shifts in the market at the earliest possible moment can lead to big profits and allow you to trade in the direction of the trend. By using the 1-2-3 trend reversal methodology, we can confidently know the exact moment a trend changes....
QQQQ's Falling Three Methods Candle Pattern
ARTICLE SYNOPSIS ...The bulls recently got a rude awakening as the bears revolted, sending QQQQ into a tailspin. But a bearish falling three methods candle pattern suggests that the selling may not quite be over yet....
A Shake Or Break For The S&P 500?
ARTICLE SYNOPSIS ...A fracture of the lower channel line on the daily S&P 500 may be nothing more than an attempt to shake out weak longs -- or does this trend break signal more downside to come?...
The Extreme Point Rule Triggers The Trade
ARTICLE SYNOPSIS ...The directional movement indicator recently flashed a sell signal on the S&P 500. Savvy traders can use the extreme point rule to find the precise entry point to act upon....
Timing Techniques Using The Bullish Percent Index
ARTICLE SYNOPSIS ...The bullish percentage index is a powerful tool that will increase your odds of determining directional moves in the stock market. Timing is everything, and using market breadth indicators such as the bullish percent index will make you a punctual trader....
Has The Gold Vein Dried Up?
ARTICLE SYNOPSIS ...Many investors have given up on gold at these extended levels, thinking that it is all tapped out. But certain technical signs suggest that we may soon be ushered into the next phase of the gold rush....
Crude Oil And The MACD Histogram
ARTICLE SYNOPSIS ...The MACD histogram gives good signals. The slope of the MACD histogram is used to determine if a trend is safe. Divergences between the MACD histogram and prices can identify shifts in momentum. Center line crossovers can also pinpoint changes in trend. The histogram on the daily and weekly charts of crude oil recently sent a cryptic message to sell. Reading the MACD histogram is probably a bit simpler and more accurate than trying to read tea leaves to determine the future of crude oil....
TRIN, The Contrarian Indicator
ARTICLE SYNOPSIS ...In recent years contrarian indicators have become increasingly popular with traders, but the Arms index stands out as one of the favorites. Knowing how to interpret the index correctly can help provide a trader with timely entry and exit points....
Bullish Belt Holds Bolster The Bears
ARTICLE SYNOPSIS ...A series of bullish belt hold candlesticks have materialized on the daily chart of the VIX reinforcing a new base of support. But will these bullish belt holds bolster the bears?...
SPY's 1-2-3 Price Reversal
ARTICLE SYNOPSIS ...The study of price behavior can help determine when actual shifts in power occur between buyers and sellers. A 1-2-3 price reversal defines the moment that occurs, clearly spelling out which group is in control....
SPY's Bearish m-M-m Setup
ARTICLE SYNOPSIS ...A downtick in the MACD histogram and a downward sell hook in the stochastic oscillator suggest lower prices for SPY....
Hi Ho Silver
ARTICLE SYNOPSIS ...Silver has had a nice run in recent months, but it could be time for prices to cool down. The iShares Silver Trust could be setting up a bearish head & shoulders top, but a trendline is standing in the way of the pattern. Let's explore the possibilities of where price might be contained should the trend break....
Rotation Out Of Tech For QQQQ
ARTICLE SYNOPSIS ...In recent days, we have started to see the tech sector struggle. In early May the Powershares QQQ Trust broke its rising trendline and started to display some weakness. If we follow the money, we can find where new interest is. While the techonology sector is busy breaking down, other sectors are breaking out....
Crude's Continuous Contract Consolidates
ARTICLE SYNOPSIS ...After a massive decline in crude oil during the last half of 2008, it staged a stealth recovery in early 2009. Crude oil is now under consolidation. But is it possible that crude oil is attempting a comeback? Tensions are once again mounting in the Middle East, while the Organization of the Petroleum Exporting Countries (OPEC) is continuing to aggressively cut production in order to shrink supply. During this recession, the US is racking up recordbreaking deficits that in time will devalue the dollar and create inflation. But these actions will only strengthen commodities over the long term....
Will A Diamond Break The Banks?
ARTICLE SYNOPSIS ...The bank rally has led the entire market higher throughout March, but two important patterns may be the driving forces that end this breath-taking rally. A tristar candle pattern formed on the XLF daily chart as a diamond chart pattern emerged on its hourly chart. Will it be enough to stop the bulls in their tracks?...
The Impeccable Timing Of Intraday Charts
ARTICLE SYNOPSIS ...A good trader is always looking for clues of a reversal, trying to piece together the technical jigsaw puzzle....
Breaking Ranks With The Bears
ARTICLE SYNOPSIS ...Is the market now breaking ranks with the bears? Recoveries are usually multifaceted, integrating candlestick reversal patterns, trend changes, chart patterns, indicators, moving averages, and divergences. If this is a legitimate turnaround, we should see evidence of it in several different areas of technical analysis, as indicators and price complement each other in an orderly reversal....
Retail HOLDRS Range-Bound
ARTICLE SYNOPSIS ...The next rally in the retail HOLDRS may have been signaled when prices crash-landed into the support made last November. If this level of support continues to hold, RTH may begin a run back to its key level of resistance at $79. The retailers continue to remain range-bound between $60 and $79, and the bulls and bears have clearly drawn the lines of support and resistance....
The NYSE Summation Index Suggests A Summer Selloff
ARTICLE SYNOPSIS ...The McClellan summation index of the NYSE is diverging with the NYSE Composite. The summation index gave a much earlier crossover signal than many other trend-based indicators such as the MACD, giving some advance warnings of an upcoming reversal....
The DJIA Breakout Collides Into Resistance
ARTICLE SYNOPSIS ...A muscular breakout on the DJIA at the opening of June has carried prices into smack-dab into a hornet's nest of resistance. If this industrial powerhouse bulks up and presses prices through these heavy weights of resistance, the DJIA could continue to the 9100 level. If not, and resistance holds, it may bring about a deadly blow that kills this rally, ushering in a correction....
10-Year Treasury Yields Strong In Multiple Time Frames
ARTICLE SYNOPSIS ...Yields on long-term Treasuries have been steadily rising, with 10-year notes racking up huge losses on speculation that the U.S. economy will have a slow recovery period. The U.S. government's excessive borrowing has overwhelmed any efforts to keep interest rates at bay....
The Big Picture For The S&P 500
ARTICLE SYNOPSIS ...How will the head & shoulders pattern play out in the days ahead for the S&P 500?...
Closing The Sale On The S&P 500
ARTICLE SYNOPSIS ...Over the last 10 weeks, the S&P 500 has been carving out a complex head & shoulders top-reversal pattern. But is the pattern starting to slip away from the bears? Are they laying the ground work for a summer selloff, or will the bulls rehabilitate and manage to resurrect the rally?...
Don't Underestimate The Power Of The VIX
ARTICLE SYNOPSIS ...The recent runup in the stock market since the March lows still has the bulls giddy. But their bearish cohorts can make a pretty persuasive argument for a summer selloff in the stock market. Over the past couple of months, the S&P 500 has been busy chiseling out a top-reversal pattern while the VIX has been quietly waiting in the wings, positioning itself for a breakout....
A Double Top Looms Over Crude Oil
ARTICLE SYNOPSIS ...The continuous contract on crude oil is now showing signs of weakness after failing to rise above the peak made in mid-June. The seasonality cycle of crude oil usually causes prices to rise in the summer months. Could crude oil prices have already peaked, even though the summer season is just getting under way?...
Banking On A Double Bottom For XLF
ARTICLE SYNOPSIS ...The ailing financial sector successfully derailed and shelved the recent market rally off the November lows. The market has become important from the weakening financial sector. XLF has helped lead the assault on the bulls, but now that XLF is testing its November lows, it may be time to break ranks with the bears and look for evidence of a reversal. In this cutthroat market, XLF will have its work cut out for it as it attempts to claw its way upward....
The QQQQ Tests Its Secondary Trendline
ARTICLE SYNOPSIS ...After a recent encounter with the rising minor trendline, the bears managed to run roughshod over the bulls, puncturing a hole in the minor rising trendline on the QQQQ's hourly chart. But a secondary trendline may be just the springboard needed to bolster the bulls....
The Dow's Dragonfly Doji And Double Dose Divergences
ARTICLE SYNOPSIS ...Technical analysis can offer us a glimpse into the future when we spot a divergence or candlestick reversal patterns and they offer clues to potential price swings and fluctuations. Either signal has credibility on its own merits, but when they have a bullish divergence on more than one intraday chart, while the daily chart puts in a reversal candlestick, it could be a winning combination for a successful trade....
XLF Fills The Gap
ARTICLE SYNOPSIS ...The horrors that have perpetrated the stock market over the past year have largely cropped up from the financial sector. The financials have no doubt been dicey in recent months, having many challenges before them in these uncertain economic times. But with the injection of capital from the Troubled Assets Relief Program (TARP) funds, the financial sector may be getting just the makeover it needs to establish a bottom, stabilize prices, and instill new confidence into investors....
With The Transports, Resistance In Multiple Time Frames
ARTICLE SYNOPSIS ...As the spotlight focuses on the Dow Jones industrials making new highs above 10,000, the transports have underperformed as they continue to sidestep, remaining range bound. The transports are colliding with overhead resistance on the daily chart, while simultaneously crashing into its declining primary trendline on the weekly chart. Can the transports overcome resistance in multiple time frames?...
Dow Theory Principle Of Confirmation
ARTICLE SYNOPSIS ...Recently, the Dow transports reaffirmed the rising intermediate trend on the Dow industrials by making a new closing high. Even though the market is looking toppy at these levels, the intermediate trend has yet to be reversed based on the principles of confirmation found in Dow theory....
Working Money: Has The Gold Vein Dried Up?
The Broadening Formation On The S&P 500
ARTICLE SYNOPSIS ...In an article I wrote in July 2009, I addressed the need for closure in order to confirm the complex head & shoulders pattern that was setting up. That pattern failed due to an 11th-hour decision to change course by the bulls. So the deal was never officially sealed on that particular reversal pattern. But since then a new bearish pattern has formed. Or has it?...
QQQQ's Ascending Broadening Wedge
ARTICLE SYNOPSIS ...The QQQQ has formed two bearish patterns during its recent runup. But even though bearish forces are at work, how far could prices drop? An ascending broadening wedge pattern might hold the answer and reveal where the correction might be contained....
A Seismic Spike For The VIX
ARTICLE SYNOPSIS ...The market has had a sinister selloff as investors have become dispirited and depressed. Each time a rally occurs, their hopes of a recovery are quickly dashed as more panicked investors sell into the rally. But the volatility index could be sending us a message that the worst may be behind us....
DIA Gets Triangular
ARTICLE SYNOPSIS ...A three inside down bearish candle pattern formed on the DJIA. Will this reversal pattern take the index lower? A symmetrical triangle may stop sellers dead in their tracks, but if the pattern opens the door to further selling, it may be time to pull the fire alarm again. Should the triangle's trendline be penetrated again, it will attract more shorts who gang up on DIA. The index needs a heralding big tent price revival in order for prices to have a heavenly ascent higher; otherwise, prices will freefall further into a bottomless pit....
A Record Rise
ARTICLE SYNOPSIS ...The DJIA marked the week of October 10 as the worst in its 112-year history. Friday, October 10, also marked its largest swing in history with 1,019 points. In contrast, the DJIA has now started this week by breaking a record to the upside. On October 13, 2008, it put in a record one-day rise, gaining 935.42 points....
The Selloff Tsunami
ARTICLE SYNOPSIS ...The Dow Jones Industrial Average put in its worst week in history. Is the tsunami of selling over?...
Further Downside Risks Lurk Over The DJIA
ARTICLE SYNOPSIS ...The intraday charts could be suggesting that there is further downside risk for the DJIA. The one- and 15-minute time frames have now gotten a lower high and lower low. There is still hope for the bulls, but if the market doesn't get a shot of capital soon, it will lose a coveted key area of support. Accumulation with expanding volume at key support is the only thing that will keep the DJIA from hemorrhaging further....
The DJIA's Test Of Support
ARTICLE SYNOPSIS ...The intraday charts magnify the short-term tug-of-wars between the bulls and the bears that causes day-to-day price fluctuations. The intraday charts provide a swing trader a wealth of information, such as key levels of support and resistance. But the intraday charts also give clues of potential future price swings as chart patterns form. When a reversal develops off of a key level of support in the intraday time frame, it could be signaling that the bears are running out of gas. Multiple time frames give traders multiple clues in order to help determine future price direction....
Conflicting Signs On The S&P 500
ARTICLE SYNOPSIS ...The intraday 60-minute chart on the S&P 500 has developed a bullish inverse head & shoulders pattern, while its daily chart has formed a bearish rising wedge. Moreover, the daily chart is in an uphill battle as it approaches the 200-day simple moving average and Fibonacci retracements. Which pattern will prevail? Support and resistance may hold the key....
The DJIA Signals Better Days Ahead
ARTICLE SYNOPSIS ...The DJIA has had a nice run from its March low, but does the move have longevity? The DJIA chart indicates there should be plenty more upside....
Inverse Complex Head & Shoulders Patterns Form A Bottom
ARTICLE SYNOPSIS ...All the major averages recently moved above overhead resistance, breaking out of inverse complex head & shoulders patterns. They are now resting right below their intermediate downward trendlines as handles are forming off the patterns. Do the indexes now have the momentum they need to break the declining trendlines? The trend-based indicators imply that they are poised for a breakout....
Putting Paid To The Bull Market?
ARTICLE SYNOPSIS ...The bears continue to have a hard time writing the obituary for the bull market that began in 2003. Will it die? Not yet -- the weekly charts show that the market is on life support....
Is The Gold Rush Over?
ARTICLE SYNOPSIS ...The gold trust shares have had an incredible run since mid-August, but is there still future upside potential? The answer lies in its trendline....
A Shining Star On The S&P 500
ARTICLE SYNOPSIS ...A morning star candlestick is shining brightly on the S&P 500, which might be a "shining star" for the market....
The Transportation's Broadening Formation
ARTICLE SYNOPSIS ...The broadening formation on the Dow Jones Transportation Average could act as a continuation pattern or a reversal....
The Aroon : A Case For The Bears
ARTICLE SYNOPSIS ...The Aroon recently flashed a bearish signal. Could we be headed for a bear market?...
An Advance Block For The S&P 500
ARTICLE SYNOPSIS ...The Standard & Poor's 500 is forming a head & shoulders top near the 200-day simple moving average. An advance block pattern is helping to complete the right shoulder....
Working Money: Do The Math The RSI Way by Ron Walker
VIX In Double Jeopardy
ARTICLE SYNOPSIS ...The VIX, a contrarian indicator, measures the implied volatility of the S&P 500 index options and can be used for spotting turning points in the market. When it peaks, the stock market is near a bottom, and when it puts in a low, the stock market is becoming toppy. With a little detective work, VIX may help us solve the mystery of which direction the market is headed....
Three White Soldier Candlesticks For S&P 500
ARTICLE SYNOPSIS ...Over the years, candlestick patterns have proven to be a reliable source of information, giving advanced warning when reversals were about to transpire. Candlesticks have many strong patterns, but it was the three white soldiers pattern that battled against the bears during this last go-round. And it is the three white soldiers that are now leading the bulls to a victorious charge....
A Trend Is A Trend Until It Isn't
ARTICLE SYNOPSIS ...The trendline is the fulcrum of power, and the longer it lingers on a chart, the stronger it becomes. The current intermediate downtrend has proved to be a stumbling block to the bulls time and again over the last couple of months, but a reversal pattern on the SPX may stop the hemorrhaging. This pattern may give the bulls just enough rope to lasso the bears....
The DJIA's Divergence And Descending Triangle
ARTICLE SYNOPSIS ...The DJIA's descending triangle may turn sour if the bulls continue to thrust prices higher above key areas of resistance. However, prices could be extending their pullback....
The QQQQ Gets A Top Failure Swing
ARTICLE SYNOPSIS ...The relative strength index gave an early signal to the current weakness on the QQQQ by forming a top failure swing. Additional clues in other time frames suggest that there may be further downside to come....
The Russell's Road To Recovery
ARTICLE SYNOPSIS ...The Russell 2000 (small cap stocks) has been on the road to recovery and is now testing the highs made in early June. It looks poised to clear June's overhead resistance in the near future, but might need a pullback to build the momentum to get the job done....
FXI Surges As China Axes A Tax
ARTICLE SYNOPSIS ...Chinese stocks have been under enormous pressure since October, declining by almost 50% as represented on the Shanghai Composite Index ($SSEC). But could tax relief on equity trading stop the Chinese stock market from bleeding? The answer may be found on the popular electronically traded fund FXI....
The Fan Principle On The S&P 500
ARTICLE SYNOPSIS ...The fan principle can be applied to corrective swings to help determine when an intermediate reaction has concluded. The breaking of the third fan line signals a reversal and that a new uptrend is about to begin....
The Nikkei's Technical Litmus Test?
ARTICLE SYNOPSIS ...As the Nikkei rises to test its down trendline, will it get a reversal at resistance? Or will prices break out? A technical litmus test should be applied to any breakout to determine if it is legitimate....
General Electric's ADX Signals
ARTICLE SYNOPSIS ...The ADX triggered several great entry points on General Electric, but which one offered the best entry point for a short-term swing trade?...
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