Category: Charts/Essays/Reports

Wayne Whaley’s TOY Barometer is possibly the single-best seasonal barometer. It uses the market’s performance between Nov 19 and Jan 20 to predict 12-month forward gains. It was brought to my attention by Steve Deppe (@SJD10304) and is worth discussing.

Tony Hsieh, CEO of Zappos.com, wrote a book titled: Everything I Know About Business I Learned From Poker. Here are some of his notes in bullet-point form with my own trading-related comments thrown in. …

Bollinger Bands, developed and trademarked by John Bollinger, are bands placed above and below a moving average. They are based on standard deviation, which is a measure of volatility, so when volatility increases, the bands widen to accommodate the price action, and when volatility dampens, the bands narrow.

The market tanked again last week. Like the previous week, there was an attempt to rally off oversold levels, but the attempt was quickly squashed. The selling we’ve gotten is much worse than anything we’ve seen in several years – much worse than February. In fact this is the single worst month following an all-time […]

Per Sam Stovall, formerly of S&P Capital IQ, every recession since 1960 has been preceded by y/y double-digit decline in housing starts. The average is -25%. The smallest (-10%) occurred ahead of the shallowest economic contraction while the biggest (-37%) occurred before deepest recession.

Commodity Channel Index, or CCI, is a momentum oscillator that relates the current price to an average price over a given period of time. So the indicator will be high when prices are far above the average and low when prices are far below the average.

Cryptocurrencies have passed the baton to pot stocks. They’ve been the hot group, in terms of percentage gains. There’s a lot of risk in the group – many of the companies will not survive – but the winners will post monster gains over the next few years.

Stochastic Oscillator is a momentum oscillator that shows where an entity has closed relative to its high-low range over a given number of periods. Signals are given via signal line crossovers, crosses from oversold or overbought territory, crosses of the center line and divergences. It’s especially useful identifying low risk areas to buy within an […]

Moving Average Convergence/Divergence, or MACD, is a momentum indicator that compares the difference between two moving averages with a third moving average. Signals are offered via signal line crosses, centerline crosses, divergences and a couple other patterns discussed below.

Relative Strength Index, or RSI, is a momentum oscillator that compares a stock to itself. It oscillates between 0 and 100, with 30 being considered oversold and 70 considered overbought. Signals are offered via divergences, center line crossovers and classic charting principles.