Monday, November 19, 2018

Long Term Investors Get Another Bite But Traders Under Pressure

A mixed bag of action. Long-term investors can look to the losses in the Russell 2000 and Nasdaq as another accumulation opportunity but if you bought Thursday's bullish piercing pattern of the Nasdaq as a near-term trading opportunity you will likely have been stopped out - or feeling ready to flee.

As a trading opportunity, the Russell 2000 is just above its stop zone (loss of Thursday's piercing pattern low). The MAD is still holding its 'buy' trigger along with its relative performance advantage, but ROC is accelerating lower - moving deeper into bear market territory. Investors shouldn't fear the noise and keep on dabbling a little here and there on the buy side.

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Sunday, November 18, 2018

Confirmation of October Lows Continue

Thursday began the confirmation of October swing lows with bullish piercing patterns and Friday kept this momentum running - even if there is still lots of work to do.

The S&P closed at Thursday's highs and kept away from the latter's lows. Volume was a little lacking but technicals, aside from the MACD, are bearish. Monday's edge favors bulls.

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Thursday, November 15, 2018

Bullish Piercing Patterns on Accumulation: Investor Buy

The developing (major) swing low got a big boost with another sizable wide range, bullish piercing pattern - similar to the bullish reversal candlestick from October 31st. Again, cautious investors who have been buying the extremes should still be active, particularly in the Russell 2000. Yes, new lows are possible, but nobody can predict the future and you can only act on the present - and now is a good buying opportunity.

The Russell 2000 was able to defend the mini-congestion zone from the end of October (the horizontal, blue hashed line). Rate-of-Change is still in the bear zone but relative performance is still positive and the MACD is clinging to a 'buy' trigger.

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Tuesday, November 13, 2018

Rallies intact despite recent losses

After returning from my brief vacation markets enjoyed decent gains which - over the last 3 days - have given back some of the advances. However, markets remain well positioned to confirm a swing low (even if October lows are breached) and investors should be buying stocks, particularly on days where losses of over1% or more are registered. Remember, this is buying for 5 years+ down the road - don't fret the daily noise.

For pessimists, there is the Semiconductor Index and Copper prices.  Copper prices broke before Semiconductors as lower demand for the base metal ultimately reflected itself in lower demand for chips, which is hurting and will continue to hurt the Nasdaq and Nasdaq 100. Keep an eye on this chart for a bottom. The likelihood is that more losses are on the cards for both copper and semiconductors.

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