Don't Ignore This Chart

StockCharts Adds A Webinar Tab ! MTA Review

Arthur Hill, Julius De Kempenaer and Greg Schnell all attended the Market Technicians Association meeting in NYC last week. With hours of presentations going on in multiple rooms it was very clear that technicians offer lots of variety and unique methods of covering the market.

The RRG charts available on StockCharts.com were in multiple presentations and were also included in one of the biggest online technical presentations in years. There are so many outstanding analysts that attend and share their work, it is exciting to see the variety of diverse market views.

I attended as many presentations as possible. Katie Stockton is on CNBC regularly and she shared her slides of the US market. Katie was full on bullish!

Robin Carpenter of CarpenterAnalytix.com presented some very unique SKEW data that was enlightening. Watching Robin's presentation was a firehose in statistical analysis. He presented three concepts and worked very hard to simplify the concepts, but he could go 7 layers deep on any slice of the concept. Very interesting presentation. Here is one of the charts he provided. Without getting into his one hour presentation, look at how close signals below zero on his CSQ Skew Deviation coincided with market pullbacks and how close to the top the signals were. In this case, he was suggesting to be careful.

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General Electric Finds Support, but Remains Short of a Breakout

It has been a rough year for General Electric (GE) because the stock is down around 4% and underperforming the S&P 500 SPDR (SPY), which is up around 6% this year. Despite relative weakness, momentum is improving as MACD edges into positive territory and the stock is bouncing off support. Notice that broken resistance and the 61.8% retracement zone turned into support as the stock bounced in early February. GE tested this level again in late March and bounced over the last two weeks. This is encouraging price action, but the stock remains below its first resistance hurdle. Look for a break above the red resistance zone (30.25-30.50) to show a significant increase in buying pressure. Such a move would turn this chart bullish and argue for further strength to the low 30s.

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Thanks for tuning in and have a great day!
--Arthur Hill CMT

Plan your Trade and Trade your Plan
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Omeros Corp (OMER) Finds A New High

Omeros (OMER) has been weak for the last two years. In the last week, it surged to new 52-week highs and kept adding to it this week. The SCTR shows the stock as a weak performer for the last two years which suggests avoidance. But the trend appears to be changing with the first new 52-week high seen in years and the stock is becoming one of the top performers based on price action.

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Charter Forms The Right Side Of A Cup

Charter Communications (CHTR) extended its multi-year uptrend in late January with a heavy volume gap higher.  CHTR spent the next several weeks consolidating and unwinding very overbought conditions.  But the stock began to resume its prior strength after its RSI touched the 40s (black arrow below) and its MACD hit centerline support.  Check out the chart:

CHTR looks solid in this potential bullish cup with handle continuation pattern.  It simply needs a handle to form, preferably on lighter volume down to test its rising 20 day EMA.  CHTR has been a very solid relative performer vs. the benchmark S&P 500.  Given the bullish pattern in play, I'd expect to see that strong relative performance continue.

Happy trading!

Tom

Ares Capital Corp (ARCC) Continues To Climb With A Strong Dividend

Ares Capital Corp (ARCC) has a beautiful chart and this week's price action suggests this trend should continue. After consolidating sideways, the chart continued its upward ascent out of the trading range.

The MACD had pulled back to the centre line and turned back up today. One thing to notice is the dividend yield is a healthy 8.65 %. Focusing in on strong stocks with a large dividend makes this a nice find.

Good trading,
Greg Schnell, CMT, MFTA

 

Russell 2000 Establishes a Clear Line-in-the-Sand $RUT

The Russell 2000 surged last week and this bounce gives chartists a clear level to watch going forward. The chart below shows the small-cap index surging from early November to early December and then stalling between 1330 and 1390 for nine weeks. The index exceeded the early December high and hit another new high with the move above 1400 in February, but this new high did not hold very long as $RUT fell back to the January lows. With last week's surge, these lows held and the 2017 lows now mark an unequivocal line-in-the-sand for chartists to watch. Being an index with hundreds of stocks, I would be inclined to add a buffer and set a support zone in the 1325-1340 area. A weekly close below 1325 would break said support zone and suggest that sellers are taking control. 

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Thanks for tuning in and have a great day!
--Arthur Hill CMT

Plan your Trade and Trade your Plan
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Defense Stocks Resolve Momentum Issues, Poised To Lead

Bullish rotation continues in most areas of the market and we saw a perfect example of that last week in the Dow Jones U.S. Defense Index ($DJUSDN).  The DJUSDN had a HUGE month in February, gaining roughly 6.5% in that month alone.  That swamped the benchmark S&P 500, which gained 3.7% in February.  The problem, however, is that early March price high was a struggle and accompanied by a negative divergence.  Take a look:

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Tesla (TSLA) - The Ride That Never Ends

Tesla (TSLA) has been a range bound stock for years with a ton of media interest. For buy and hold investors, the last three years has been difficult. It's the rollercoaster ride that never ends. I wrote about Tesla when it was at its lows in December. Is Tesla About To Hit The Ditch December 4th, 2016? You can see where the trend lines were drawn. In the article, I discussed how important it would be that the lows hold. A break above 30 on the SCTR would be bullish. We can see the lows held, TSLA broke out above the trend and went on an $80 run. 

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ConocoPhillips Breaks Downtrend; SCTR Soars

ConocoPhillips (COP) saw its SCTR soar nearly 47 points after an 8.81% increase in its stock price broke its four month downtrend.  COP's strength began earlier this week on a reversing candle at gap support and culminated with today's breakout.  Here's the chart:

Prior to this most recent uptrend, COP was oversold with its RSI near 30.  That's an unusually low level considering that COP is in a longer-term uptrend.  The SCTR closed at 77 on Thursday, but I'd expect to quickly see the December SCTR high just below 90 tested sooner rather than later.

Happy trading!

Tom