Stock Charts

growth stock chart analysis

Satyam Computer (SAY) Fraud Highlights The Advantage of the Self Investor & The Importance of Chart Reading

Posted By Tate Dwinnell |  Subscribe in a reader | Comment 0

Something I’ve talked quite a bit about over the past few years in running this blog is the big advantage of the small guy.. the self investor over the big, laboring elephant that is the institutional investor.  You are the nimble, market ninja able to move to cash quickly by cutting losses quickly on positions and waiting for better investing environments.  The big fella has no such advantage because of the requirements to stay mostly invested and the slow process of unwinding positions and moving into new ones.  Institutions are forced to rely on on the financials of the past and management guesstimates of the future to make million dollar bets.  The problem with this approach is the executives lie or are just flat out wrong AND long before the earnings show deterioration, the stock will have already fallen off a cliff.

Case in point, Satyam Computer (SAY) of India.  Now here’s a company …

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More on this topic (What's this?) Read more on Satyam Computer at Wikinvest

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Upward Trend Line Off Nov Low Needs to Hold: A Look At SPY 30 Min Chart

Posted By Tate Dwinnell |  Subscribe in a reader | Comment 1

Just a quick heads up to let you all know what I’m keeping an eye on for tomorrow.  Following that push above the 50 day moving averages in both the S&P and Dow, we have had two days of selling with today’s plunge putting the S&P and Dow back below support of their 50 day moving averages.  The market remains somewhat bullish up here, but it’s critical that we hold the November upward trend line which I’ll be watching on the 30 min charts of the SPY, DIA and Q’s tomorrow.  Below is a look at the 30 minute chart of the SPDR S&P500 ETF (SPY).  You can see the  trend line that was tested again today with a decent bounce in the last 30 minutes of trading to keep that level of support intact. 

Read Entire Post “Upward Trend Line Off Nov Low Needs to Hold: A Look At SPY 30 Min Chart” Here

More on this topic (What's this?)
S&P Setup For Re-test Of August Low
Nearly 70% Of S&P 500 Stocks In Correction Or Bear Market Territory
S&P Approaches Critical Tipping Point
Market Timing Risk
Read more on Abc Communications, SPDR S&P 500 ETF, S&P 500 (SPX) at Wikinvest

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Synalloy (SYNL) Breaking the Triangle

Posted By Tate Dwinnell |  Subscribe in a reader | Comment 0

Synalloy continues to look extremely bullish and has busted out of a triangle formation today with heavy volume.

synalloy synl breakout stock chart triangle

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Is Hansen Natural (HANS) Running Out of Energy?

Posted By Tate Dwinnell |  Subscribe in a reader | Comment 2

Hansen Natural Recent News:

Random Roger » Shiller Is Wrong

Posted 21 hours ago

My latest post for Alpha Baskets is published and includes the following; According to ETF.com there are 58 ETFs focused on technology totaling about $70 billion. They all appear to be index funds or smart beta funds, but any use of these funds would clearly be part of an active strategy. Ditto any other sector funds or funds that are narrower than sectors. While someone might pushback on me that there is no passive strategy …

Random Roger » Very Odd And Unfamiliar Crimson Hue On My Screens

Posted 5 days ago

The title for the weekly Market Update comes from a Tweet from Todd Harrison. The update also includes the following; Gold hit an air pocket on Friday after a widely reported sale of futures that had a notional value of $4 billion. This equates to about 10% of average daily volume in one trade. Although we found nothing to support this, our first inclination is to think we might subsequently hear it was a fat …

Stock Trading To Go » Weekly Market Recap Nov 12, 2017

Posted 5 days ago

While it was the first losing week in 8 for the major averages, bulls should continue to be happy as such minor losses after significant rallies are just part of a consolidation period. Tuesday was the only positive day for the week but again we are talking about a very low volatility environment, where "down days" are often in the spirit of -0.15%. That said the weakness in the Russell 2000…

Random Roger » Don’t Get Done In By Unintended Overweight Exposure

Posted 8 days ago

My latest post for Alpha Baskets covers a lot of ground and includes the following; With a starting point being 60/40 equities/fixed income, the proposed (theoretical?) portfolio allocates 37% to fixed income so that’s not far from 40 but takes a lot from equities to put into diversifiers. Emerging market equity gets about 2/3rd of the overall equity allocation and using iShares funds as proxies, emerging market equity has a standard deviation of 15% compared …

Random Roger » What Is Risk Allocation & Should You Invest In It?

Posted 11 days ago

My latest post for Alpha Baskets is posted and includes the following; This topic is always interesting to ponder and fun to write about. As I have said many times before my introduction to the idea that allocations can go beyond 70/60/50 equity, the rest in fixed income goes back to the 90’s when I first read about Jack Meyer who was running the Harvard Management Company, the endowment, and he was talking about timberland …

Random Roger » Bitcoin Graduates From Mania To Hysteria

Posted 12 days ago

The weekly Market Update is posted and includes the following; Last week was another strong one for mega cap tech with more strong earnings, a big product launch and news on Friday of what we will call (and trademark) a possible Quoadcom merger. We tend to believe that sector weightings are very important to monitor. Excessive weightings, relatively and nominally, have been harbingers of doom before and tech is now approach 25% of the S&P …

Stock Trading To Go » Weekly Market Recap Nov 05, 2017

Posted 12 days ago

While there was some chop to this past week, the bulls remain in control as that chop right now would be seen as some form of consolidation after a round of market gains. The weekly gain for the S&P 500 was 0.3% and for the NASDAQ 0.9%. For the month of October the S&P 500 was up 2.2% and the NASDAQ 3.6%. Monday was the only day of sustained selling and some attributed that to …

Random Roger » Ditch That Nine to Five Now, While You Still Can!

Posted 17 days ago

My latest post with a title inspired by James Altucher is up at Alpha Baskets and includes the following; However, it feels like they are underestimating the impact of an unfortunately timed bear market. Coincidentally I just a conversation about this with a client. We’ve talked here before about sequence of returns and the luck of when your first post-retirement bear market comes along. Without attempting to predict anything, it would be prudent for anyone …

Random Roger » Get Ready For #MACtion

Posted 19 days ago

The weekly Market Update is posted at Alpha Baskets and includes the following; Another negative indicator is that mutual fund cash is at an all time low according to a chart citing ICI data that was Tweeted out all over the place this weekend. The reason this is a negative is that if there is no more cash in mutual funds then a potential source of demand is thought to be dried up. Again on …

Stock Trading To Go » Weekly Market Recap Oct 29, 2017

Posted 19 days ago

As Jim Cramer would say, it's just another boo yah after boo yah for bulls. Earnings season continues and indexes continue to hit highs. Gains were not huge for the week but Friday's whiplash higher surely was felt by bears. “Earnings remain a solid tailwind for equity prices,” said Robert Doll, chief equity strategist at Nuveen Asset Management LLC, in a note. “Just over 20% of S&P 500…

Random Roger » Retire On Less Than One Bitcoin A Month!

Posted 3 weeks ago

My latest post for Alpha Baskets takes a first (for me) look at cryptocurrencies and blockchain technology. For the last month or so I’ve been geeking out on cryptocurrencies and blockchain. I’ve done a lot of reading and listening (podcasts) to try to learn more. I’ve become convinced that blockchain is the real deal in terms of how the financial system evolves and that the concept of cryptocurrencies is also the real deal. For many …

Random Roger » Dow 23,000 Hats For Everyone!

Posted 4 weeks ago

The weekly Market Update is posted and includes the following; The yield on the Ten Year US Treasury Note jumped on Friday to close at 2.38% which is as high as it has been since early July. Barron’s cited a strategist from JP Morgan who opined that based on this point in the cycle, yields should be higher. He noted distortions that have been created by QE and other extraordinary stimulative efforts as being a …

Stock Trading To Go » Weekly Market Recap Oct 22, 2017

Posted 4 weeks ago

Another week of nearly no volatility… in what has historically been one of the month's most fraught with volatility. Four very small days of gains to begin the week followed by a decent leg upward Friday. Bulls continue to be in complete control and records of "little volatility" continue to be shredded. The S&P 500 gained 0.9% for the week. Apple took a hit Thursday and while the…

Random Roger » Indexing; Valid But Flawed

Posted 4 weeks ago

My latest post for Alpha Baskets is published and is a two-fer that includes the following; And speaking of behaviors, by now you know that Richard Thaler, a very well regarded behavioral economist won the Nobel Prize in economics. I got to e-meet Dr. Thaler on an AdvisorShares AlphaCall a couple of years ago. Most of what he talked about is captured in this post from Marketwatch (via Morningstar). One of the things he is …

Random Roger » FOMC Divergence

Posted 5 weeks ago

The weekly Market Update is posted at Alpha Baskets and includes the following; The cryptocurrency sphere was buzzing last week as Bitcoin took the $5000. Bespoke Investment Group posted a table showing 12 different cryptocurrencies with more than $1 billion totalling $145 billion with Bitcoin far and away the leader with $89 billion. It is certainly a mania but probably doesn’t rise to the level of true bubble from the standpoint that is something catastrophic …

Stock Trading To Go » Weekly Market Recap Oct 15, 2017

Posted 5 weeks ago

Last week brought back the extremely non volatile market! Nary a move of >0.2% up or down on the S&P 500 in any of the 5 sessions. After some rallying the prior few weeks this is exactly what the doctor ordered for bulls; this was especially necessary for the Russell 2000. For the week both the S&P 500 and NASDAQ gained 0.2%. “Investors are following the tax-reform debate, as well…

Random Roger » Why Does FINRA Have An Investment Portfolio?

Posted 5 weeks ago

My latest post for Alpha Baskets is posted and includes the following; So here’s a weird one involving FINRA that you might have picked up in the last few days. Apparently it has a large, $1.6 billion, investment portfolio and the returns have been weak, according to the Wall Street Journal, under performing a 50/50 equity/fixed income portfolio for quite a few years. Please click through to read the entire post. El Morro National Monument …

Random Roger » Jobs Weak, Market Doesn’t Care

Posted 6 weeks ago

The weekly Market Update is posted and includes the following; Perhaps most interesting is that wages moved up out of its multi-month rut of 0.2/2.5 to show a gain in September of 0.5% with the year over year number at 2.9% which would appear to provide some cover for a December rate hike. Barron’s offered a counter opinion from the Liscio Report that jobs lost were lower paying jobs because of the storm thus making …

Stock Trading To Go » Weekly Market Recap Oct 08, 2017

Posted 6 weeks ago

This was the third week in a row where we saw major indexes post 4 gains out of 5 for the week! While none of the gains individually were massive, when you have 3 weeks in a row of almost identical behavior you start to walk into a market where some of the indexes need […]

Random Roger » Why Does Larry Swedroe Hate Dividends?

Posted 6 weeks ago

My latest post for Alpha Baskets is published and includes the following; Here’s the problem; back in 2003, 2004 and so one when the first dividend centric funds came out, most of them were grossly overweight to financials. I wrote about practically all of them for The Street.com and made that same point in every article. I certainly wasn’t predicting the crisis but any strategy that is thought of at least partially broad based but …

Random Roger » 2017 Enters The Home Stretch

Posted 7 weeks ago

This week’s Market Update is posted and includes the following; The GOP and the President of course announced their tax plan, or at least an outline of a tax plan. Some of the highlights included fewer tax brackets, ending the AMT, ending the death tax, a cut in the corporate tax rate. The negative for now seems to be the estimates ranging from $2-$5 trillion in reduced revenue. Now congress will set to the dirty …

Stock Trading To Go » Weekly Market Recap Oct 01, 2017

Posted 7 weeks ago

This past week was almost a carbon copy of the prior week – 4 days of gains offset by 1 day of mild losses. The bulls continue to own 2017. Importantly, small caps saw a second strong week in a row after being the laggard of the year — so a healthy rotation continues throughout the market. Even a "hawkish" speech by Janet Yellen on Tuesday could not slow down this train: Investors shruged off…

Random Roger » Portfolio For An Apocalypse?

Posted 7 weeks ago

My latest post for Alpha Baskets critiques a portfolio put forth in Barron’s to help navigate a large decline and includes the following; I plugged all the symbols into a chart, except for the VIX ETP and the China ETF, and the returns from October 2007 to March 2009 ranged from -15% to -67%. Any broad-based real estate proxy is unlikely to go down that much more than the market if for nothing else than …

Random Roger » Balance Sheet Reduction By Paper Cut

Posted 8 weeks ago

The weekly Market Update is posted at Alpha Baskets and includes the following; The Government Pension Fund of Norway, the country’s sovereign wealth fund, recently surpassed $1 trillion in AUM. The fund was established in the 1990’s as an investment pool for revenue accrued from oil. The fund owns an average of 1.3% of every publicly traded company on the planet. The country’s GDP is only $370 billion. If they paid out every citizen, all …

Stock Trading To Go » Weekly Market Recap Sep 24, 2017

Posted 8 weeks ago

Four days of mild gains offset by a day of modest losses led to a quiet week. For the week the S&P 500 gained 0.4%, the NASDAQ fell 0.3% while the Russell 2000 was the standout with a gain of 1.3%. The Federal Reserve did announce the long awaited draw down of it's balance sheet which was of no surprise – and the market's reaction was muted. The Fed ended it's massive bond buying program …

The faster they rise, the harder they fall.. eventually.  None have risen faster or been discussed more in trader circles then Hansen Natural (HANS) over the past couple years.  With the stock rising parabolically with seemingly no end in sight, there will come a time when a significant correction will occur.  It looks like that time is near.  The stock staged a climax run in early May on news of a distribution deal with Anheiser Busch and  I don’t think it’s any coincidence that the stock met resistance right around 200.  Major whole numbers often mark the end of a big run.

Shorting a great company like Hansen (HANS) can be a risky move in a market that may be putting in a bottom, but there are a few scenarios where the reward vs. risk might be favorable enough for short entry.  One way I’d play this is to look for a low volume return to what is now resistance around the 20 day moving average at around 180.  You see the stock dipping below that level with sizable volume yesterday which is the first time it’s been below this support level since mid February. 

On the other hand, there is some support in the stock at 170 and I’d be looking to play this on the short side should it break below that level with heavy volume (which would most likely happen only if the market breaks key support levels)

6706_hans

More on this topic (What's this?)
More on the Energy Bubble
Accidental invention could light up the future
Harness Energy
Q3 2005 In Review
Read more on Hansen Natural, Energy at Wikinvest

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Charts: Forecasting the Future

Posted By Tate Dwinnell |  Subscribe in a reader | Comment 0

There was a time when I had the patience (and time) to peruse the garbage filled discussion boards and listen to the thoughts of other investors/traders, occasionally offering my own two cents.  I must say those days are long gone, especially for the most hyped stocks.  I suppose I grew tired of sifting through the usual boasting, insulting, hyping and griping to get to the few interesting posts.  On a few occasions, I remember having a disagreement regarding the usefulness of chart reading.  It was said that chart reading was just "vodoo" and for the superstititous.  Believe it or not, many investors still feel this way.  But trading stocks without reading the chart is like navigating a thick forest without a compass.  It’s difficult to know where you’re going or where you’ve been.  It’s important to remember that the market looks to the future and the current price and volume pattern is a reflection of investors feelings about the future of the company.  So much so that often times charts can predict future news or growth long before it actually happens.  The charts can tell you where you might be going.  (I say might because chart reading is NEVER 100% – if it were, everyone would be rich.  It’s all about swinging the probability of success in your favor).  You don’t think so?  Then why is it that great companies with solid fundamentals sell off on no news, only to find out several months later that earnings and sales targets are missed?  Why is it that a stock surges with great volume on no news, only to release postive news a few weeks later?  Believe it or not, the big money (institutions… and/or insiders of course) has much more information on a company than you or I do.  As much as they would like to hide their tracks, it is not possible because volume levels reveal the move.  They are showing their hand.

Let’s take a look at a couple of examples of the importance of chart reading and the ability of charts to forecast the future.  The first example is of a company called Noble International, which was growing rapidly.  From March ’03 to June ’04 the company had posted quarter over quarter earnings growth of 61%, 38%, 23%, 71%, 24% and 38%.  That’s some mighty impressive growth.  The buy and hold investor who was just looking at the fundamentals probably would have held the stock until poor earnings were in fact released.  The problem with this strategy is that the stock will almost always sell off long before that first earnings report is released.  Once again, the charts (current price/volume) looks to the future.   Another argument from the buy and hold investor may be "Well, it’s a great company and it will come back."  Sure, it may come back.  It may come back in a month, 6 months, 3 years or never.  You lose no matter how long the stock spends correcting.  Either you’ll be hit with a sizable loss or you’ll be sitting on dead money for who knows how long.  You can always buy it back when the technical action improves (with most brokerages charging less than $15 for a market order, commission costs are no longer a big concern).  OK, on to the chart of Noble International (NOBL).

Nobl

Looking at the chart above (click to see larger image) there were several clues that would have told you to get out of the stock long before the 50% decline.  Looking at the overall structure you see a series of failed breakout attempts.  The stock surges on heavy volume, only to fall back into a base on a few occasions.  But the first obvious signal occurred on June 9th when the stock reversed on heavy volume.  Clearly, institutions were looking to unload shares at any opportunity.  The next couple of clues came in the form of a high volume plummet below major support of the 50 day moving average.  If that wasn’t enough of a sell sign, then the large amount of insider selling during that time should have been.  Several million dollars worth of NOBL shares were sold in May and June by several insiders.  Sure enough, the following quarter, the company reported less than stellar results as earnings came in less than the year ago period with a -6% quarter over quarter growth.  A great example of the chart forecasting the future.

It can work in the opposite direction as well.  A great example of this is DHB Industries (DHB), which soared over 20% today on news of a major order from the U.S. Army as well as the City of Baltimore.  But several days ago, there was a darn good clue that some good news was on the horizon.  That clue came in the form of … you guessed it, a high volume advance on no news.  But something was going on.  Let’s take a look at the chart below (click for larger image)

Dhb

As you can see, the big gap up with no news occurred on Nov 15.  It actually happened again on Nov 22, to a lesser degree.  Moves like these don’t usually happen for no reason.. it seemed at the time that another big order announcement was coming down the pike and that is exactly what happened.  Perhaps the CEO David Brooks (who sold 3.7 million shares on Nov 30th) should get a few lessons in chart reading!  Although, he’s probably too busy counting his money considering he made 70 million on the sale… what’s another 15 million right?

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The Triangle Revisited

Posted By Tate Dwinnell |  Subscribe in a reader | Comment 0

A few days ago in a post titled “The Failure of a Triangle”, I looked at the failure of a well formed triangle pattern as the market continued to slump. It’s important to point at that while these particular patterns often work, they, like all patterns, are never gauranteed. Today I thought I’d take a look at another triangle pattern that did successfully breakout. The company is SFBC Intl, Inc. and it broke through the upper portion of the triangle with good buying volume. Notice the declining volume as the triangle forms and then the explosion in price and volume on the breakout. (click the image for a larger view)

canslimblogSFCCclose

What you see here is that the triangle formation is actually a handle formation for a much larger cup base. I think it’s important to note that the cup base is not a well formed base. You like to see a smoother base with less volatilility and more time spent forming the right side of the cup. While today’s move was a good one, it may have trouble getting above 40 in the near term due to market weakness and the magnitude of the advance in such a short time.

canslimblogSFCClong

Please note this is not a recommendation to buy or sell.. always do your own research before making a decision. Have a comment about this or other posts? I’d love to hear it.. have a good weekend!

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The Failure of a Triangle

Posted By Tate Dwinnell |  Subscribe in a reader | Comment 2

This is the first in what will be a series of posts highlighting stocks that have failed from bullish patterns and will be categorized under “When Good Charts Go Bad”. It’s important to study the chart patterns that fail so that we can avoid purchasing the stock or get out before getting burned. Today’s look is at a bullish symmetrical triangle formation that formed after a successful breakout from a flat base several weeks earlier. Often cited as a continuation pattern, the triangle formation presents a brief pause after a significant run up, before breaking out to additional gains. (as always, click the image below for a larger view)

canslimblogTMI

In this particular case, Team Inc. caught my attention as a well formed triangle formation and I watched it closely for a break above the upper portion of the triangle with heavy volume. It never happened. Eventually, the stock broke below the support level of the lower portion of the triangle with heavy selling volume. However, no loss occurred because no buy signal was presented. This is a great example of why it is important to look for a breakout above resistance with large buying volume. Without the wind at your back, your chances at success will diminish significantly.

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