Intraday Market Direction Thursday: Nasdaq Higher…

Tuesday 3/7/17. Intraday Market Direction: Dow

Weekly, since inception on 6/14/2011:

     The prediction of the index closing higher has been right 133/222 or 59.9% of the time.

     The prediction of the index closing lower has been right 32/64 or 50.0% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

$ $ $

I show a picture of the Dow industrials on the 5-minute scale.

On the right is a chart with three red horizontal retrace lines drawn.

These are not exact but close enough. The AB move is approximately 400 points. Line C is (less than) 100 points lower, or ~25% of the AB move.

Lines D and E have retraced 50% and 75% of the AB move, respectively.

Several times I have used a 62% Fibonacci retrace to enter a trade and have made money.

However, whenever a stock retraces too far, we have to believe the short-term trend has reversed. That’s what I think is happening.

In other words, I expect the market to close lower on Tuesday.

If you want a fundamental reason for a longer term reversal, the FED will probably raise interest rates this month. And that’s going to frighten the market. I expect
weakness for a month. Why? See the prediction for 2017. The market should bottom in early April if the forecast holds true. But it rarely holds true…

$ $ $

The following table shows where Fibonacci retrace values of the day’s high-low range are plus pivot points, calculated on the Dow industrials, sorted by value. When several are near each other (small differences),
the area might act as support or resistance.

— Thomas Bulkowski

Monday 3/6/17. Market Monday: The Week Ahead

My Prediction

I show the Dow utilities on the daily scale.

The letters highlight a chart pattern called a measured move up.

I’ve talked about this chart pattern often enough. The idea is that leg CD will equal the length of leg AB. It’s rare that it actually does.

However, what’s exciting about this pattern is what happens after the pattern completes.

Accord to my book,
Chart Patterns: After the Buy,

the stock will retrace 36% of the AD move (that’s the median retrace). The breakout is upward 85% of the time (meaning a close above the peak at D).

All of this means the index should retrace a bit and the recover to make new highs.

A Brief Look Back

The following is a brief review of how the markets performed over time. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Up 15.68 points.

Tuesday: Down 25.2 points.

Wednesday: Up 303.31 points.

Thursday: Down 112.58 points.

Friday: Up 2.74 points.

For the Week…

The Dow industrials were up 183.95 points or 0.9%.

The Nasdaq composite was up 25.44 points or 0.4%.

The S&P 500 index was up 15.78 points or 0.7%.

Year to Date…

Dow Industrials

     0.8% down from the high of 21,169.11 on 03/01/2017.

     6.7% up from the low of 19,677.94 on 01/19/2017.

Nasdaq

     0.7% down from the high of 5,911.79 on 03/01/2017.

     8.8% up from the low of 5,397.99 on 01/03/2017.

S&P 500

     0.7% down from the high of 2,400.98 on 03/01/2017.

     6.1% up from the low of 2,245.13 on 01/03/2017.

Options Expiration

No options expire this week.

Swing and Position Traders: Chart Pattern Indicator

As of 03/03/2017, the CPI had:

10 bearish patterns,

6 bullish patterns,

257 patterns waiting for breakout.

The CPI signal is 37.5%, which is
neutral (between 35% and 65%).

The chart pattern indicator is bullish
with 1 of 3 full triangles showing (). Additional triangles are a measure
of strength with solid triangles meaning a more reliable signal than half triangles.

Swing Traders: Pivot Points

The following is based on an SFO article in December 2004 by John Seekinger, titled, “Take a
two-dimensional approach.” He offers these tips.

• Seekinger doesn’t look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
• S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
• If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
• In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
• A move outside of daily R1 or S1 usually does not mean a breakout.
• The odds suggest that the entire week’s price action will remain between weekly R2 and S2.
• Avoid going long when the market moves above weekly R2 (it’s overbought) and avoid going short when price moves below weekly S2 (oversold).
• Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
• Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

Pivot point: P = (H + L + C)/3

First resistance level: R1 = (2 * P) – L

First support level: S1 = (2 * P) – H)

Second resistance level: R2 = P + (R1 – S1)

Second support level: S2 = P – (R1 – S1)

H = high price , L=low price, C=closing price

Consecutive Price Trends

How long can an index close higher (or lower) each day? The adjacent table shows how often consecutive up or down closes occur in the indices, based on the most recent trend of closes.

Low percentages suggest the market is overdue to turn (think of it as the likelihood that next week or next month will continue the trend, based on historical performance). Values of 50% mean random, so most percentages will be lower.

The analysis uses data going back 10 years for weekly percentages and 25 years for monthly percentages (or the start of data, whichever is more recent). Any unchanged closing price is interpreted as the end of the string of consecutive up or down closes.

Earnings, Chart Patterns & Industries

Earnings season is over.

Large numbers of bullish or bearish chart patterns can signal short- to intermediate-term market trends (many bullish chart patterns can mean an uptrend will continue, for example).
However, please realize that the short-term price trend could have changed since the pattern was discovered (this is especially true of pipe tops or bottoms, which are weekly patterns).

The 10 types of most frequently appearing chart patterns in the stocks, indices, and long-only exchange traded funds I follow during the last month are shown in the adjacent table.

The industries I follow were the best (rank 1) and worst performing.

— Thomas Bulkowski

Friday 3/3/17. Pattern Trading Setups for the Weekend.

Go to Table.

You can find setups based on a Fibonacci retrace by clicking on the link.

Click the link for a list of symbols from the table.

The following patterns were found manually, so the results may differ from those found using Patternz.

There were 25 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 615 stocks searched, or 4.1%. Based on the percentage, the stock market is
trending since few consolidation patterns appear.

Excluding ETFs, there were 14 bullish chart patterns this week and 4 bearish ones with any remaining (3) being undecided.
The ratio of bullish to bearish patterns suggests the market is hinting of a coming bullish (up) turn.

In the table below, the red and green colors are based on the historical breakout direction for the associated chart pattern. If a high and tight flag appears, the start and end dates highlight the flagpole only and not the flag.

More…

— Thomas Bulkowski

Definitions

’Breakout is upward/downward 100% of the time’ means price breaks out up/down by definition, not by statistically measuring the rate.

All numbers assume a bull market and are based on the breakout direction that occurs most often.

Industry: Apparel

Industry RS rank: 54 out of 56

Stock RS rank: 589 out of 607

3/2/17 close: $13.32

1 Month avg volatility: $0.55. Volatility stop (for upward breakout): $11.30 or 15.2% below the close.

Change YTD: 11.00%

Volume: 19,990,500 shares.
3 month avg: 3,598,268 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.

 

Chart pattern: Big W reversal pattern from 01/31/2017 to 03/01/2017

Breakout is upward 71% of the time.

Average rise: 31%.

Break-even failure rate: 11%.

Throwbacks occur 32% of the time.

Price hits measure rule target 42% of the time.

Industry: Semiconductor

Industry RS rank: 5 out of 56

Stock RS rank: 39 out of 607

3/2/17 close: $62.42

1 Month avg volatility: $1.70. Volatility stop (for upward breakout): $58.92 or 5.6% below the close.

Change YTD: 14.01%

Volume: 197,000 shares.
3 month avg: 368,726 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.

 

Chart pattern: Channel from 04/29/2016 to 03/02/2017

Industry: Chemical (Diversified)

Industry RS rank: 44 out of 56

Stock RS rank: 86 out of 607

3/2/17 close: $103.06

1 Month avg volatility: $2.05. Volatility stop (for upward breakout): $98.05 or 4.9% below the close.

Change YTD: 19.73%

Volume: 2,033,400 shares.
3 month avg: 934,745 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Monday.

 

Chart pattern: Head-and-shoulders bottom reversal pattern from 02/02/2017 to 02/24/2017

Breakout is upward 100% of the time.

Average rise: 38%.

Break-even failure rate: 3%.

Throwbacks occur 45% of the time.

Price hits measure rule target 74% of the time.

Industry: Retail Building Supply

Industry RS rank: 32 out of 56

Stock RS rank: 436 out of 607

3/2/17 close: $46.59

1 Month avg volatility: $0.99. Volatility stop (for upward breakout): $43.49 or 6.7% below the close.

Change YTD: 1.13%

Volume: 407,400 shares.
3 month avg: 477,158 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.

 

Chart pattern: Triangle, symmetrical continuation pattern from 01/26/2017 to 02/28/2017

Breakout is upward 54% of the time.

Average rise: 31%.

Break-even failure rate: 9%.

Throwbacks occur 37% of the time.

Price hits measure rule target 66% of the time.

Industry: Retail (Special Lines)

Industry RS rank: 46 out of 56

Stock RS rank: 551 out of 607

3/2/17 close: $40.61

1 Month avg volatility: $0.82. Volatility stop (for downward breakout): $42.75 or 5.3% above the close.

Change YTD: -0.07%

Volume: 2,254,600 shares.
3 month avg: 2,487,711 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.

 

Chart pattern: Broadening top reversal pattern from 02/15/2017 to 02/28/2017

Breakout is downward 50% of the time.

Average decline: 15%.

Break-even failure rate: 18%.

Pullbacks occur 48% of the time.

Price hits measure rule target 37% of the time.

Industry: Trucking/Transp. Leasing

Industry RS rank: 6 out of 56

Stock RS rank: 199 out of 607

3/2/17 close: $9.00

1 Month avg volatility: $0.53. Volatility stop (for upward breakout): $7.75 or 13.9% below the close.

Change YTD: 25.87%

Volume: 741,700 shares.
3 month avg: 443,074 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.

 

Chart pattern: Triangle, symmetrical continuation pattern from 12/09/2016 to 03/02/2017

Breakout is upward 54% of the time.

Average rise: 31%.

Break-even failure rate: 9%.

Throwbacks occur 37% of the time.

Price hits measure rule target 66% of the time.

Industry: Precision Instrument

Industry RS rank: 27 out of 56

Stock RS rank: 12 out of 607

3/2/17 close: $79.29

1 Month avg volatility: $1.64. Volatility stop (for upward breakout): $74.98 or 5.4% below the close.

Change YTD: 24.63%

Volume: 884,600 shares.
3 month avg: 588,569 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Tuesday.

 

Chart pattern: Channel from 01/11/2016 to 03/02/2017

Industry: Toiletries/Cosmetics

Industry RS rank: 52 out of 56

Stock RS rank: 596 out of 607

3/2/17 close: $18.71

1 Month avg volatility: $0.54. Volatility stop (for upward breakout): $17.61 or 5.9% below the close.

Change YTD: 2.18%

Volume: 5,534,600 shares.
3 month avg: 6,317,472 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Tuesday.

 

Chart pattern: Triangle, symmetrical continuation pattern from 02/08/2017 to 03/02/2017

Breakout is upward 54% of the time.

Average rise: 31%.

Break-even failure rate: 9%.

Throwbacks occur 37% of the time.

Price hits measure rule target 66% of the time.

Industry: Packaging and Container

Industry RS rank: 42 out of 56

Stock RS rank: 477 out of 607

3/2/17 close: $53.26

1 Month avg volatility: $0.78. Volatility stop (for upward breakout): $51.54 or 3.2% below the close.

Change YTD: 1.31%

Volume: 641,800 shares.
3 month avg: 995,574 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.

 

Chart pattern: Triangle, symmetrical continuation pattern from 11/30/2016 to 03/02/2017

Breakout is upward 54% of the time.

Average rise: 31%.

Break-even failure rate: 9%.

Throwbacks occur 37% of the time.

Price hits measure rule target 66% of the time.

Industry: Natural Gas (Diversified)

Industry RS rank: 53 out of 56

Stock RS rank: 450 out of 607

3/2/17 close: $43.47

1 Month avg volatility: $1.28. Volatility stop (for upward breakout): $40.78 or 6.2% below the close.

Change YTD: -4.82%

Volume: 4,379,400 shares.
3 month avg: 4,519,568 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.

 

Chart pattern: Channel from 12/08/2016 to 03/02/2017

Industry: Retail Store

Industry RS rank: 50 out of 56

Stock RS rank: 546 out of 607

3/2/17 close: $53.77

1 Month avg volatility: $2.38. Volatility stop (for upward breakout): $47.69 or 11.3% below the close.

Change YTD: -14.23%

Volume: 1,412,900 shares.
3 month avg: 778,415 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.

 

Chart pattern: Broadening bottom reversal pattern from 01/06/2017 to 03/02/2017

Breakout is upward 53% of the time.

Average rise: 27%.

Break-even failure rate: 10%.

Throwbacks occur 41% of the time.

Price hits measure rule target 59% of the time.

Industry: Chemical (Specialty)

Industry RS rank: 30 out of 56

Stock RS rank: 252 out of 607

3/2/17 close: $14.77

1 Month avg volatility: $0.33. Volatility stop (for upward breakout): $13.35 or 9.6% below the close.

Change YTD: 3.07%

Volume: 1,362,000 shares.
3 month avg: 349,135 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.

 

Chart pattern: Head-and-shoulders complex bottom reversal pattern from 01/19/2017 to 02/24/2017

Breakout is upward 100% of the time.

Average rise: 39%.

Break-even failure rate: 4%.

Throwbacks occur 63% of the time.

Price hits measure rule target 74% of the time.

Industry: Electric Utility (Central)

Industry RS rank: 28 out of 56

Stock RS rank: 169 out of 607

3/2/17 close: $64.95

1 Month avg volatility: $1.15. Volatility stop (for upward breakout): $61.89 or 4.7% below the close.

Change YTD: -0.54%

Volume: 48,000 shares.
3 month avg: 109,512 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.

 

Chart pattern: Triangle, symmetrical continuation pattern from 12/13/2016 to 03/01/2017

Breakout is upward 54% of the time.

Average rise: 31%.

Break-even failure rate: 9%.

Throwbacks occur 37% of the time.

Price hits measure rule target 66% of the time.

Industry: Computer Software and Svcs

Industry RS rank: 26 out of 56

Stock RS rank: 243 out of 607

3/2/17 close: $64.01

1 Month avg volatility: $0.65. Volatility stop (for upward breakout): $62.58 or 2.2% below the close.

Change YTD: 3.01%

Volume: 24,510,900 shares.
3 month avg: 24,100,571 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.

 

Chart pattern: Triangle, symmetrical continuation pattern from 01/27/2017 to 03/02/2017

Breakout is upward 54% of the time.

Average rise: 31%.

Break-even failure rate: 9%.

Throwbacks occur 37% of the time.

Price hits measure rule target 66% of the time.

Industry: Building Materials

Industry RS rank: 23 out of 56

Stock RS rank: 346 out of 607

3/2/17 close: $16.00

1 Month avg volatility: $0.39. Volatility stop (for downward breakout): $17.23 or 7.7% above the close.

Change YTD: 2.24%

Volume: 272,300 shares.
3 month avg: 381,377 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.

 

Chart pattern: Rectangle bottom continuation pattern from 12/13/2016 to 03/02/2017

Breakout is downward 55% of the time.

Average decline: 14%.

Break-even failure rate: 16%.

Pullbacks occur 69% of the time.

Price hits measure rule target 50% of the time.

Industry: Computer Software and Svcs

Industry RS rank: 26 out of 56

Stock RS rank: 553 out of 607

3/2/17 close: $116.49

1 Month avg volatility: $4.63. Volatility stop (for downward breakout): $127.03 or 9.1% above the close.

Change YTD: -6.85%

Volume: 6,725,200 shares.
3 month avg: 1,927,266 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Friday.

 

Chart pattern: Dead-cat bounce continuation pattern from 03/01/2017 to 03/01/2017

Breakout is downward 67% of the time.

Average decline: 18%.

Industry: Chemical (Specialty)

Industry RS rank: 30 out of 56

Stock RS rank: 484 out of 607

3/2/17 close: $33.55

1 Month avg volatility: $0.63. Volatility stop (for upward breakout): $32.24 or 3.9% below the close.

Change YTD: 4.71%

Volume: 618,800 shares.
3 month avg: 514,149 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.

 

Chart pattern: Triangle, ascending reversal pattern from 01/26/2017 to 03/01/2017

Breakout is upward 70% of the time.

Average rise: 35%.

Break-even failure rate: 13%.

Throwbacks occur 57% of the time.

Price hits measure rule target 75% of the time.

Industry: Insurance (Prop/Casualty)

Industry RS rank: 17 out of 56

Stock RS rank: 572 out of 607

3/2/17 close: $58.20

1 Month avg volatility: $0.87. Volatility stop (for downward breakout): $61.06 or 4.9% above the close.

Change YTD: -7.81%

Volume: 161,500 shares.
3 month avg: 196,043 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Monday.

 

Chart pattern: Triangle, descending reversal pattern from 01/18/2017 to 03/02/2017

Breakout is downward 64% of the time.

Average decline: 16%.

Break-even failure rate: 16%.

Pullbacks occur 54% of the time.

Price hits measure rule target 54% of the time.

Industry: Chemical (Specialty)

Industry RS rank: 30 out of 56

Stock RS rank: 61 out of 607

3/2/17 close: $34.15

1 Month avg volatility: $0.83. Volatility stop (for upward breakout): $32.28 or 5.5% below the close.

Change YTD: 2.09%

Volume: 75,700 shares.
3 month avg: 228,660 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.

 

Chart pattern: Triangle, symmetrical continuation pattern from 12/21/2016 to 03/02/2017

Breakout is upward 54% of the time.

Average rise: 31%.

Break-even failure rate: 9%.

Throwbacks occur 37% of the time.

Price hits measure rule target 66% of the time.

Industry: Retail (Special Lines)

Industry RS rank: 46 out of 56

Stock RS rank: 4 out of 607

3/2/17 close: $23.58

1 Month avg volatility: $0.99. Volatility stop (for downward breakout): $26.09 or 10.7% above the close.

Change YTD: -7.71%

Volume: 1,248,200 shares.
3 month avg: 1,604,106 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Wednesday.

 

Chart pattern: Rising wedge reversal pattern from 01/17/2017 to 03/02/2017

Breakout is downward 69% of the time.

Average decline: 14%.

Break-even failure rate: 24%.

Pullbacks occur 63% of the time.

Price hits measure rule target 46% of the time.

Industry: Internet

Industry RS rank: 13 out of 56

Stock RS rank: 232 out of 607

3/2/17 close: $83.62

1 Month avg volatility: $1.52. Volatility stop (for upward breakout): $79.51 or 4.9% below the close.

Change YTD: 9.93%

Volume: 674,100 shares.
3 month avg: 887,189 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.

 

Chart pattern: Triangle, symmetrical continuation pattern from 02/14/2017 to 02/28/2017

Breakout is upward 54% of the time.

Average rise: 31%.

Break-even failure rate: 9%.

Throwbacks occur 37% of the time.

Price hits measure rule target 66% of the time.

Industry: Metals and Mining (Div.)

Industry RS rank: 36 out of 56

Stock RS rank: 246 out of 607

3/2/17 close: $88.92

1 Month avg volatility: $0.78. Volatility stop (for downward breakout): $91.75 or 3.2% above the close.

Change YTD: 6.93%

Volume: 177,400 shares.
3 month avg: 297,428 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.

 

Chart pattern: Rising wedge reversal pattern from 12/12/2016 to 03/02/2017

Breakout is downward 69% of the time.

Average decline: 14%.

Break-even failure rate: 24%.

Pullbacks occur 63% of the time.

Price hits measure rule target 46% of the time.

Industry: Investment Co. (Domestic)

Industry RS rank: 29 out of 56

Stock RS rank: 313 out of 607

3/2/17 close: $26.09

1 Month avg volatility: $0.23. Volatility stop (for downward breakout): $26.83 or 2.9% above the close.

Change YTD: 6.10%

Volume: 44,900 shares.
3 month avg: 57,637 shares.

This security may be thinly traded (less than 100k shares)!

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.

 

Chart pattern: Rising wedge reversal pattern from 12/21/2016 to 03/02/2017

Breakout is downward 69% of the time.

Average decline: 14%.

Break-even failure rate: 24%.

Pullbacks occur 63% of the time.

Price hits measure rule target 46% of the time.

Industry: Investment Co. (Foreign)

Industry RS rank: 41 out of 56

Stock RS rank: 409 out of 607

3/2/17 close: $40.42

1 Month avg volatility: $0.21. Volatility stop (for downward breakout): $40.94 or 1.3% above the close.

Change YTD: 4.15%

Volume: 701,400 shares.
3 month avg: 896,468 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.

 

Chart pattern: Rising wedge reversal pattern from 01/25/2017 to 02/28/2017

Breakout is downward 69% of the time.

Average decline: 14%.

Break-even failure rate: 24%.

Pullbacks occur 63% of the time.

Price hits measure rule target 46% of the time.

Industry: Petroleum (Producing)

Industry RS rank: 45 out of 56

Stock RS rank: 301 out of 607

3/2/17 close: $11.17

1 Month avg volatility: $0.15. Volatility stop (for downward breakout): $11.60 or 3.8% above the close.

Change YTD: -4.69%

Volume: 21,135,000 shares.
3 month avg: 26,977,786 shares.

Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.

 

Chart pattern: Rectangle bottom continuation pattern from 01/09/2017 to 03/02/2017

Breakout is downward 55% of the time.

Average decline: 14%.

Break-even failure rate: 16%.

Pullbacks occur 69% of the time.

Price hits measure rule target 50% of the time.

Thursday 3/2/17. Intraday Market Direction: Nasdaq

Weekly, since inception on 6/14/2011:

     The prediction of the index closing higher has been right 121/213 or 56.8% of the time.

     The prediction of the index closing lower has been right 41/80 or 51.2% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

$ $ $

I show a picture of the Nasdaq composite on the 5-minute scale.

The index climbed today after gapping higher at the open and curling over (A).

That curling reminds me of an inverted and ascending scallop.

If that pattern unfolds tomorrow, you should see the index retrace a portion (55%) of today’s move higher.

$ $ $

I received an email from a relative. It said, “Dow over 21,000, when do you go to all cash to avoid the inevitable drop?”

I told her to wait for the Dow to drop 20% down from the high. When that occurs, it’s a bear market. Sell.

Her response: “When I sell at 20% down, the market recoups and meets new highs. I want to avoid the 20% dip, perfect timing, how hard can that be?”

My answer: If the market is going to drop by 20%, sell it before it does.

The following table shows where Fibonacci retrace values of the day’s high-low range are plus pivot points, calculated on the Nasdaq composite, sorted by value. When several are near each other (small differences),
the area might act as support or resistance.

— Thomas Bulkowski

Wednesday 3/1/17. A Look At Indicators

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

The indicator shows bearish divergence as the two red trendlines on the right of the chart illustrate.

However, pre-market the Dow futures are up 180 points, so I expect a big opening and probably a much higher close. And that will make the bearish divergence disappear, I think.

The red line is the percentage of stocks at least 20% below their 1-year high (plotted upside down). The blue line is the average percentage drop of stocks below their 1-year high (plotted upside down).

From a week ago, the two lines show no change.

— Thomas Bulkowski

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