Trading Quiz Tuesday…

Monday 7/10/23. Market Monday: The Week Ahead

My Prediction

This is a chart of the Dow utilities on the daily scale.

The red line represents support. Notice how several valleys come near the line and rebound upward.

At AB, we see a potential double top. It won’t become a valid double top until the index closes below C.

I’m not sure that’s going to happen. I suspect that we’ll see the index turn upward and eventually rise above A.

I suppose that since the index is already dropping toward C, that we could see it bounce off the red line another time before staging an upward run.

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 10.87 points.

Wednesday: Down 129.83 points.

Thursday: Down 366.38 points.

Friday: Down 187.38 points.

Saturday: Holiday or other weird event!

For the Week…

The Dow industrials were down 672.72 points or 2.0%.

The Nasdaq composite was down 127.2 points or 0.9%.

The S&P 500 index was down 51.43 points or 1.2%.

Year to Date…

Dow Industrials

     2.5% down from the high of 34,588.68 on 06/16/2023.

     7.3% up from the low of 31,429.82 on 03/15/2023.

Nasdaq

     1.4% down from the high of 13,859.07 on 06/16/2023.

     33.1% up from the low of 10,265.04 on 01/06/2023.

S&P 500

     1.3% down from the high of 4,458.48 on 06/30/2023.

     15.9% up from the low of 3,794.33 on 01/03/2023.

Options Expiration

No options expire this week.

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

Earnings, Chart Patterns & Industries

Earnings season will be starting in about 6 days.

Here’s a symbol list of 159 chart and candlestick patterns (13 “investment grade” candle patterns) found in today’s securities using my version of Patternz:
ABM, AXDX, ACIW, ADTN, ATSG, ALRM, ALB, AA, ALKS, ADM, ANET, AVA, AXS, BMI, BALL, BECN, BIG, BA, BAH, BMY, CACI, CALM, CE, CLS, CNA, CGNX, CTSH, CMCO, CMTL, CRH, CROX, CCK, DVN, DDS, ^DJI, DRQ, EME, EOG, EFX, RE, EVRG, XOM, FIS, GME, GIS, GILD, GPN, GFS, GL, GES, HBI, HE, HSII, HSY, HOLX, HUM, HUN, ITGR, INTC, IPAR, IBKR, TILE, IPI, IRM, JAZZ, JNJ, KBH, LANC, RAMP, L, M, MGY, MRO, MDC, MRK, MU, MUR, NBR, NJR, NEU, NKE, NOVT, NUS, NVDA, OXY, OMC, OTEX, OUT, OXM, PATK, PDCO, PTEN, PXD, PINC, PSTG, RMBS, RTX, REGN, RNG, RHI, RCKY, RES, SMG, SMAR, LUV, SWX, SSYS, SRDX, TDOC, TDY, TER, TEVA, TXT, TKR, TJX, TZOO, TREX, MDRX, VC, WRB, WEX, ZBRA, IEZ, IHE, DDM, FXI, IYH, IHF, ILF, SLV, IEO, EWZ, ECH, EEM, EWQ, EWG, EWS, EWT, THD, IBB, PBE, PXJ, PJP, XLV, VHT. Click this link for details (pattern type, start and end dates).

For a list of small patterns (those a few days wide) click this link.

The below industries were the best (rank 1) or worst performing of those I follow.

— Thomas Bulkowski

Friday 7/7/23. Pattern Trading Setups for the Weekend.

$ $ $

Here’s a symbol list of 227 chart and candlestick patterns (13 “investment grade” candle patterns) found in today’s securities using my version of Patternz:
DDD, ANF, ABM, AXDX, ACN, ACIW, AEIS, AMD, ALRM, ALKS, AYX, ABC, AMN, ATR, ANET, AVNT, AXS, AZTA, BCPC, BBY, BIIB, BKH, BCO, BMY, BBW, CBT, CVX, CHD, CLNE, CLF, CGNX, CMCO, CRH, CROX, XRAY, FANG, DSGR, ^DJI, DOV, EXP, EOG, EFX, EXPI, FICO, FORM, FTNT, FTV, FCX, GME, GFS, GGG, GES, HBI, THG, HLIT, HAYN, HP, HOLX, DHI, IEX, ITW, INFN, IIIN, INTC, IPG, IRM, JAZZ, JNJ, KMT, KLIC, LZB, LANC, M, MRO, MLM, MAS, MTDR, MTRN, MDC, MDT, MU, MLI, MUR, MYGN, NTGR, NTAP, NEU, NEE, NXGN, NKE, NWPX, NOVT, OXY, OMC, ASGN, OUT, OMI, OXM, PKE, PATK, PETS, PFE, PXD, RNG, ROST, RGLD, SLB, SMG, SEE, SIGI, SRE, SCI, SHW, STR, SCCO, SWX, SSYS, SUM, TPR, TECH, TFX, TER, TEVA, TTD, TKR, UIS, VFC, WU, WLK, WPM, WMB, WWW, ZBRA, IYM, IYE, ITB, IHE, DDM, FTEC, QTEC, FXL, FXI, BOTZ, IHF, IAT, IEV, IGV, IXC, MXI, IXN, ILF, IGE, IEO, IHI, EWO, EWK, EWZ, EEM, EWQ, EWG, EWH, EIS, EWI, EWJ, EWW, EPP, EWS, EZA, EWY, EWP, EWD, EWL, EWT, EWU, IBB, PBE, PEJ, PJP, PHO, ROBO, XLV, XHB, XLI, XLB, XLK, UNG, VHT, VIS, VAW. Click this link for details (pattern type, start and end dates).

For a list of small patterns (those a few days wide) click this link.

$ $ $

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

The following patterns were found manually, not using Patternz. Mr. Bulkowski has excluded any securities he owns from appearing in the list. However, he may add any of the securities listed to his portfolio at any time, just as you can.

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.

For details about the chart patterns, click here.

— Thomas Bulkowski

Thursday 7/6/23. A Look at Cryptocurrency Bitcoin (BTC-USD)

Weekly, since inception on 6/14/2011:

     The prediction of the Nasdaq closing higher has been right 260/457 or 56.9% of the time.

     The prediction of the Nasdaq closing lower has been right 72/152 or 47.4% 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 cryptocurrency Bitcoin (BTC-USD) on the daily scale.

There’s only one thing I want to mention about this chart and that’s the potential of a pennant.

A flag (has parallel sides) or a pennant (unparallel sides) can appear midway through a move.

In this case, the pennant has to be perched atop a flagpole, which I show as the AB rise. If the pennant obeys the theory, the rise from the low at C should also be the same AB length.

How often does that work? In stocks, a move of 19% from A to B falls short on the C to (D, not shown) move by rising only 14%. So don’t expect the full AB rise.

$ $ $

Here’s a symbol list of 159 chart and candlestick patterns (13 “investment grade” candle patterns) found in today’s securities using my version of Patternz:
ABM, ACN, ACIW, ADBE, AMD, AES, ALRM, AA, ALKS, AEE, AXP, ATR, ADM, ANET, ATO, BCPC, BSET, BERY, BIIB, BMY, BBW, BG, CBT, CNP, CENX, CVX, CIEN, CGNX, COP, CROX, CCK, CW, FANG, ^DJU, D, DRQ, DTE, DUK, EIX, EOG, EFX, EXPI, FARO, FNV, FRD, GFS, HBI, HLIT, HAYN, HP, HURC, TILE, INTU, ISRG, IRM, JNJ, KELYA, LZB, LANC, LOW, MTSI, MRO, MAS, MTDR, MTRX, MDC, MS, NBR, NCR, NXGN, NKE, NOC, NWPX, NOVT, OXY, OTEX, ORCL, OR, OUT, OMI, OXM, PANW, PATK, PCTY, PXD, PPL, PEG, QCOM, RMBS, RGS, RNG, RHI, RGLD, RES, R, SLB, SMG, SMTC, SLGN, STR, SWX, SSYS, TEVA, TKR, TJX, SLCA, UIS, VFC, VMI, VEEV, MDRX, WAT, WEX, WPM, WMB, WOLF, WWW, ZBRA, IYE, ITB, IEZ, IDU, IAT, IXC, IGE, IEO, EWK, ECH, EWW, EZA, EWD, EWL, PXJ, XLU, UNG, VONG. Click this link for details (pattern type, start and end dates).

For a list of small patterns (those a few days wide) click this link.

$ $ $

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 7/5/23. Market Forecast Update

Weekly, since inception on 6/14/2011:

     The prediction of the Dow closing higher has been right 265/481 or 55.1% of the time.

     The prediction of the Dow closing lower has been right 51/108 or 47.2% of the time.

$ $ $

Here’s the updated 2023 forecast, presented in slider format.

$ $ $

Here’s a symbol list of 139 chart and candlestick patterns (13 “investment grade” candle patterns) found in today’s securities using my version of Patternz:
ACN, AKAM, AA, ALKS, ALGT, ALL, AXP, AMAT, ASH, AIZ, BRC, BRKR, BBW, CAL, CLS, CVX, CHS, CLNE, CNO, CGNX, CMTL, CXW, CROX, ^DJT, BOOM, EBAY, EFX, FDS, FDX, FIS, FCX, GD, GPN, GS, GFF, GES, HIG, HQY, HOLX, HON, HUBG, HUN, ITW, INTC, IBKR, IPI, NVTA, JNJ, KALU, KSS, LRCX, LANC, RAMP, L, M, MOS, MUR, NFG, NOV, NCR, NTGR, NJR, NXGN, NKE, JWN, NUS, OXY, OUT, PATK, PTEN, PGR, KWR, QCOM, DGX, RMBS, RTX, RGA, RNG, RCKY, ^GSPC, SAIA, SAND, SCHW, SMTC, SLGN, STR, SKX, SKYW, SWX, SCS, TPR, TGT, TDOC, TFX, TXT, TKR, TDG, TG, UNH, V, VC, WEX, ZBRA, ITA, IAI, IYC, IYE, ITB, IEZ, FXI, IAT, MXI, ILF, IEO, EWZ, EEM, EWI, EWM, EPP, EWY, THD, PEJ, PXJ, XLY, XLE, XRT. Click this link for details (pattern type, start and end dates).

For a list of small patterns (those a few days wide) click this link.

$ $ $

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 7/3/23. Market Monday: The Week Ahead

My Prediction

Not much is going on in this picture of the Nasdaq on the daily scale.

The red line highlights support and resistance. On the left half of the chart, we see the index bumping up against overhead resistance. On the right side, it’s too soon to see if the index
will drop and find support at the line.

Beyond that, I’m expecting the indices to continue moving higher over the next two weeks. Fortunately, after I rebalanced most of my portfolios in the last week or two, I feel well positioned to take advantage of any 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: Down 12.72 points.

Tuesday: Up 212.03 points.

Wednesday: Down 74.08 points.

Thursday: Up 269.76 points.

Friday: Up 285.18 points.

For the Week…

The Dow industrials were up 680.17 points or 2.0%.

The Nasdaq composite was up 295.4 points or 2.2%.

The S&P 500 index was up 102.05 points or 2.3%.

Year to Date…

Dow Industrials

     0.5% down from the high of 34,588.68 on 06/16/2023.

     9.5% up from the low of 31,429.82 on 03/15/2023.

Nasdaq

     0.5% down from the high of 13,859.07 on 06/16/2023.

     34.3% up from the low of 10,265.04 on 01/06/2023.

S&P 500

     0.2% down from the high of 4,458.48 on 06/30/2023.

     17.3% up from the low of 3,794.33 on 01/03/2023.

Options Expiration

No options expire this week.

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

Earnings, Chart Patterns & Industries

Earnings season is over.

Here’s a symbol list of 244 chart and candlestick patterns (13 “investment grade” candle patterns) found in today’s securities using my version of Patternz:
DDD, AYI, AEIS, AJRD, A, ALRM, ALL, DOX, AMED, AEL, AXP, AFG, AMWD, APH, AR, AON, APOG, AAPL, AIZ, AXS, BMI, BSET, BZH, BBY, BIO, BCO, BR, CBT, CPB, CHKP, CVX, CHS, CHD, CTAS, CLNE, CGNX, CTSH, CMTL, CONN, COST, CR, CRH, CCRN, DVN, DFS, DOV, BOOM, EFX, XOM, EZPW, FDS, FICO, FAST, FDX, FISV, FLEX, FLS, FTNT, FTV, FWRD, FRD, IT, GD, GE, GFS, GMS, GPRO, GGG, GES, HIG, HON, HWM, IDXX, NSP, IIIN, INTC, IBKR, TILE, IPG, IPI, JAZZ, JNJ, KEYS, KLAC, KLIC, LZB, LANC, LXU, MTSI, MANH, MRTN, MAS, MA, MDC, MRK, MRCY, MCO, MUR, MYGN, ^IXIC, NCR, NTGR, NWL, NXGN, JWN, NOC, NOVT, OXY, OLN, ON, OTEX, ORCL, OR, PKE, PATK, PETS, PPG, PG, PRU, DGX, RGS, RGA, RNG, RHI, ROK, ROP, ROST, RGLD, ^GSPC, SAIA, SAND, SCHW, SIGI, NOW, STR, SWX, SR, SPLK, SXI, SNPS, TRGP, TGT, TFX, TDC, TER, TXN, TMO, TKR, TJX, RIG, TG, UIS, UNH, MDRX, VRSN, V, WU, WDAY, ZBRA, IYM, IYC, IYE, ITB, IEZ, IHE, IDU, DDM, FTEC, FDN, QTEC, FXL, QQQ, IYH, IAT, IYZ, IGV, IXC, IXN, SOXX, IGE, IEO, IYF, IHI, EWC, EWQ, EWH, EWI, EWM, EWP, THD, QLD, PPA, PEJ, PXJ, PHO, SSO, ROBO, XLY, XLE, XLF, XLV, XHB, XLI, XLB, SPY, XLK, VHT, VIS, VAW, MGK, VONG. Click this link for details (pattern type, start and end dates).

For a list of small patterns (those a few days wide) click this link.

The below industries were the best (rank 1) or worst performing of those I follow.

— Thomas Bulkowski