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 » Is A Minsky-esque Moment Coming?

Posted 6 days ago

The weekly Market Update is posted and includes the following; In several previous weekly updates we have talked about volatility in political headlines increasing but not being matched by equity market volatility as measured by the CBOE Volatility Index. In addition to the above mentioned volatility in the slope of the yield curve, WTI has become more volatile as measured by the VIX for crude oil which can be tracked through symbol OVX. Since March …

Stock Trading To Go » Weekly Market Recap Jul 16, 2017

Posted 7 days ago

Market bulls continue to make anyone even moderately cautious (hand raised) look a fool. A technical breakout mid week on the indexes took the market out of a sleepy range that was looking a bit dangerous. Monday and Tuesday were the normal sleepiness we've come to expect from this slow and steady grind up of 2017 but some fireworks Wednesday and Friday. Earnings season began in earnest…

Random Roger » Even The “Experts” Get It Wrong Occasionally

Posted 10 days ago

My latest post for Alpha Baskets is published and includes the following; The best example of why this is, comes from the tech wreck. For a while, the options market appeared to be giving money away, you could sell a semi-deep out of the money put on a $300 stock and easily bring in a couple of thousand dollars. This worked for a time and then the crash came and put sellers were paying $250 …

Random Roger » Do Investors Want More Correlation?

Posted 13 days ago

The weekly Market Update is posted at Alpha Baskets and includes the following; The history of earnings recessions was that they lead to economic recessions but this did not happen (yet?). This is one of several supposed to’s in the aftermath of the crisis that did not pan out as people expected. Another one was maintaining a zero percent interest rate policy would cause extreme price inflation and obviously CPI has been floundering for years, …

Stock Trading To Go » Weekly Market Recap Jul 09, 2017

Posted 14 days ago

Some more volatility hit late this past week but any pullback of note (Thursday) still has bulls rushing in (Friday). Modest moves Monday and Wednesday sandwiched the holiday on Tuesday. The "rotation out of tech" continued most of this week: “The rotation out of tech is dominating stocks and is the overarching theme in the market,” Mike Antonelli, equity sales trader at Robert W. Baird…

Random Roger » The Goodwin Fire

Posted 15 days ago

On June 24th a fire broke out southeast of Walker that was quickly named the Goodwin Fire (pretty much any fire bigger than a smoldering stump gets a name). The terrain was very thick with manzanita and chaparral at the lower elevations (about 5000 feet) and Ponderosa pine higher up. This was what the smoke looked like from my house around 4-5pm on June 24th. At around 6pm on that first day I went out …

Random Roger » The Unfightable Wildifre

Posted 17 days ago

My latest blog post for Alpha Baskets looks at the overlap between wildfire behavior and stock market behavior with inspiration taken from the Goodwin Fire which for a time was unfightable. We caught a huge break with the weather last Thursday. From the post; There are certain fire behaviors that need to be understood as basic building blocks of understanding. Much like with markets, these building blocks aren’t infallible but do account for the vast …

Random Roger » Jawboning Works?

Posted 20 days ago

The weekly Market Update is posted at Alpha Baskets and includes the following; The yield on the Ten Year US Treasury Note jumped 16 basis points to 2.30%. To the extent a flattening curve leads to an inverted curve, the FOMC was in a bit of bind but for now, anyway, appear to have steepened the curve giving them more flexibility to hike later, assuming the recent steepening sticks.The euro jumped above 1.14 which is …

Stock Trading To Go » Weekly Market Recap Jul 02, 2017

Posted 3 weeks ago

Some volatility was reintroduced to the market this past week as <0.80% moves on the S&P 500 (and even larger moves on the NASDAQ) happened Tue, Wed, and Thu. This is certainly a welcome change from a trading (and writing perspective) from the relatively monotone move upward almost all of 2017! Losses Tuesday accelerated after Republican Senate leaders postponed a vote on the…

Random Roger » Meir Statman Says Time Diversification Is Hokum

Posted 3 weeks ago

My latest post for Alpha Baskets looks at an article by Meir Statman and includes the following; Statman’s opening argument begins “consider an investor who invests $1,000 in a portfolio with a 50–50 chance to gain 20% or lose 10% each year.” To me the argument is lost right here in the open as there are an almost infinite number of different outcomes not two outcomes. Statman lays out the math which is obviously correct …

Random Roger » Central Bank Hedge Funds?

Posted 4 weeks ago

This week’s Market Update is posted at Alpha Baskets and includes the following; It is widely known that the Bank of Japan has been a large buyer of Japanese equities, mostly through ETFs. In recent months it has become known that the Swiss National Bank has been very active buying equities as part of its attempt to put downward pressure on the franc (it prints francs and buys equities). Please click through to read the …

Stock Trading To Go » Weekly Market Recap Jun 25, 2017

Posted 4 weeks ago

Relatively large moves Monday (up) and Tuesday (down) were followed by the small volatility the rest of the week that has marked almost all of 2017. The NASDAQ jumped 1.4% Monday, the largest gain since Nov 7th as the relatively moderate selling the prior week was offset. “Tech got beat up unfavorably over the past week or two, but as the group’s earnings remain strong, we expect buyers are…

Random Roger » The Crash That Will Bring Down the Entire Galaxy

Posted 5 weeks ago

Ben Carlson had a little fun poking fun at the regular calls from Jimmy Rogers predicting the worst crash in our lifetime and other sensational headlines like the one for this post that is hopefully amusing. Ben found a headline like this attributable to Rogers going back every year to 2011. He says these extreme predictions offer no value. John Hussman has an interesting approach to this sort of thing. While Hussman’s concerns have come …

Random Roger » The Hike Everyone Was Expecting

Posted 5 weeks ago

The weekly market update was posted and includes the following; The FOMC met last week and of course hiked rates to a new range of 1.00%-1.25%. The move was widely expected, built into Fed Funds futures pricing but seems to be widely derided as well. Barron’s made the argument that the policy group is underestimating the downward pressure on prices from creative destruction seen in things as mundane as unlimited data plans getting cheaper and …

Stock Trading To Go » Weekly Market Recap Jun 18, 2017

Posted 5 weeks ago

A week ago Friday the NASDAQ put in an "outside reversal" day – this is approximately a day where the trading range exceeds both the prior day's intraday high and intraday low, and then a close below the prior day's intraday low. See our NASDAQ chart from a week ago below: This is often a quite bearish signal, but the market has been so immune to any real selling for so long, it has been…

Random Roger » Retirement Reading Roundup

Posted 6 weeks ago

My latest post for Alpha Baskets is up and includes the following. Maybe less related but still a good read is from the Charlotte Observer, weighing in on how far $1500 will get you retiring in Ecuador. This is a fun topic to write about. It is interesting to many people on some level even if not a serious consideration for many. My thought on how this might work has evolved. As opposed to planning …

Random Roger » The Dark Knight Passes

Posted 6 weeks ago

The title as a nod to the passing of Adam West, the weekly Market Update has been posted at Alpha Baskets and includes the following; The action in emerging market exchange traded funds bears mentioning. The larger ETFs are up 15-20% this year after years of relative misery. As a building block of understanding, most investors would accept that a diversified portfolio would have exposure to foreign markets including emerging. The last few years of …

Stock Trading To Go » Weekly Market Recap Jun 11, 2017

Posted 6 weeks ago

Four placid days led to a Friday that in recent terms would be considered "wild" but in 2008 terms would be considered a "quiet session". There was some actual volatility Friday as indexes gapped up and ran before reversing sharply mid morning and sell off, led by the giant tech stocks that have been the stars of 2017. If that is a precursor of anything or algorithms gone wild for a few hours,…

Random Roger » Monetizing A Hobby

Posted 7 weeks ago

One of the long running themes of this blog has been to monetize a hobby as part of a retirement planning solution. I last touched on it a month ago. The context is simple. If you enjoy doing something enough that you spend a lot of your time doing it then you are in a good position to know whether or not your hobby can in fact be monetized. Success in this regard, like most …

Random Roger » We’ll Always Have Paris

Posted 7 weeks ago

The weekly Market Update is posted at Alpha Baskets and includes the following; During the financial crisis we all learned a lot about the financial health or lack thereof for the states with pension obligations being a big driver in many instances. One of the weakest states was revealed to be Illinois and things have not improved, arguably they have gotten worse. Standard & Poors and Moody’s both cut their ratings for the state to …

Stock Trading To Go » Weekly Market Recap Jun 04, 2017

Posted 7 weeks ago

Last week was "bull market action" – sideways action to digest and then the grind continues higher. Monday was a holiday, while Tuesday and Wednesday saw almost no movement in the major indexes, and then Thursday and Friday brought a nice steady uptrend. Bears remain lost at sea. For the month of May, the S&P 500 gained 1.2% while the NASDAQ surged 2.5%. The Dow was only up 0.3%. In…

Random Roger » Blogger Wisdom

Posted 7 weeks ago

My latest post excerpts a commentary I submitted to the blog Abnormal Returns; Ten years hence, what we will be embarrassed by that we were excited about in 2017? We will likely be embarrassed by whatever it is we fear the most today. For some, that might be something political, for others it might be fear of one of the many bubbles that we read about that probably aren’t real. In the summer of 2002 …

Random Roger » Watching Tech’s Weighting In The SPX

Posted 8 weeks ago

The weekly Market Update is posted at Alpha Baskets and includes the following; Barron’s had some interesting information on tech’s current weighting in the S&P 500 as follows; “Today, tech stocks make up 23.1% of the S&P 500, above the historical average of 15.4%, and fast catching up to the 26.5% combined weight for the six smallest sectors. While 23% still looks innocuous compared with a 34% weighting at the tech-bubble peak, Bespoke Investment Group …

Stock Trading To Go » Weekly Market Recap May 28, 2017

Posted 8 weeks ago

Another winning week for the bulls, in a year full of them! Things kicked off with a bang with a gap up Monday as the after shocks of the Comey removal – the one thing that seemed to shake this market for 24 hours – passed in the night. Wednesday, minutes of the Federal Reserve’s latest policy meeting showed broad agreement on plans to begin shrinking the central bank’s balance sheet and also…

Random Roger » It Turns Out Brazil Has Political Problems

Posted 8 weeks ago

My latest post for Alpha Baskets looks at the shenanigans in Brazil and includes the following; Paraphrasing Lloyd Bridges from the movie Airplane, Brazil picked the wrong week to quit sniffing glue as news of an alleged incident implicating President Michel Temer with bribery sent the benchmark Bovespa index and the real reeling on Thursday. When the dust settled on Thursday the Bovespa was down about 9%… Please click through to read the entire post. …

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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