Today, I’d like to follow up on our previous look at the 20-period RSI for the S&P 500 (shown in the bottom panel of the chart below). This indicator has been near a breakout for several weeks.  You may recall that the 20-period RSI is useful as regime indicator. In a bullish market regime, the indicator stays above 40. In a bearish regime, it stays below 60. In the chart, thin horizontal lines mark the 40 and 60 levels. The red zones indicate moves below 40.  Despite last week’s gains, the indicator remains below 60, which is a cause for… Read More

Today, I’d like to follow up on our previous look at the 20-period RSI for the S&P 500 (shown in the bottom panel of the chart below). This indicator has been near a breakout for several weeks.  You may recall that the 20-period RSI is useful as regime indicator. In a bullish market regime, the indicator stays above 40. In a bearish regime, it stays below 60. In the chart, thin horizontal lines mark the 40 and 60 levels. The red zones indicate moves below 40.  Despite last week’s gains, the indicator remains below 60, which is a cause for concern.  ​ I expected a breakout last week as traders reacted to earnings from Apple, Facebook, and Amazon. Instead of a defined breakout, the S&P 500 just drifted higher.  The index has now retraced more than half of the decline that came at the end of last year. That’s bullish. But we remain about 1.3% below the 200-day moving average (MA), shown as the solid blue line in the chart. This is a widely followed indicator, and I expect the test of the MA will be a topic of conversation on CNBC this week. A close above the MA is… Read More

Since December 24, when the S&P 500 registered its lowest mark of 2018 (and a near 20% pullback from its September highs) we’ve seen a robust rebound. The index has rallied more than 12% since then.  I don’t know whether we’re out of the woods just yet… but between a couple of bullish indicators that I’ll discuss below, and my Maximum Profit system signaling four new buys last week, I’d say that the outlook at the moment is positive.  —Recommended Link— What would YOU do with an extra $3,080 every month for the rest of your life? Never worry… Read More

Since December 24, when the S&P 500 registered its lowest mark of 2018 (and a near 20% pullback from its September highs) we’ve seen a robust rebound. The index has rallied more than 12% since then.  I don’t know whether we’re out of the woods just yet… but between a couple of bullish indicators that I’ll discuss below, and my Maximum Profit system signaling four new buys last week, I’d say that the outlook at the moment is positive.  —Recommended Link— What would YOU do with an extra $3,080 every month for the rest of your life? Never worry about cash again. Be free to live how YOU want… go on a lavish vacation… or build up a college fund for the grandkids–it’s up to you.  Get your share here… Indicator #1 The first bullish indicator is one that I touched on previously, and that’s the Advance-Decline Line (AD Line). This is a breadth indicator that shows us how many stocks in the underlying index — the NYSE Composite Index in this case — are advancing and how many are declining. The purpose of looking at a breadth indicator is to gauge market sentiment, whether it’s leaning… Read More

Stock prices ended last week slightly above the important resistance levels I outlined last week. You can see this in the daily S&P 500 chart below.  ​ After two days of trading this week, prices still had not cleared that level.  As I noted last week, resistance is a level where a price advance is expected to stall. I identified three specific factors — the March lows, the 50-day moving average (MA) and the 50% retracement of the October-to-December decline. On Friday, the S&P 500 had closed above each of those levels… which would have been a strong signal… Read More

Stock prices ended last week slightly above the important resistance levels I outlined last week. You can see this in the daily S&P 500 chart below.  ​ After two days of trading this week, prices still had not cleared that level.  As I noted last week, resistance is a level where a price advance is expected to stall. I identified three specific factors — the March lows, the 50-day moving average (MA) and the 50% retracement of the October-to-December decline. On Friday, the S&P 500 had closed above each of those levels… which would have been a strong signal that the bear market was ending.  But when the market opened Tuesday morning, things got off to a rough start. Over the course of the day, the S&P 500 gave back some of the prior week’s gains and closed below 50-day MA and 50% retracement level.  So, does this mean we’re in for another round of gains… or does it signal further losses to come?  —Recommended Link— 3 Shots At Making 1,000% Or More. Jim Fink’s new stock picking system just hit on three companies that could put up to $330,000 in your pocket. And… Read More

As the stock market enters earnings season, I’m feeling concerned… and it seems like I’m not the only one.  My bet is that we can expect volatility in the coming weeks. Our trading strategy over at Profit Amplifier focuses on avoiding risk, and one way we can do that is by adding exposure to utility stocks — a defensive sector that traders turn to when they are looking for low-risk trades.  Time To Get Defensive While looking through my screens, I found a very attractive call option trade in Southern (NYSE: SO), a gas and… Read More

As the stock market enters earnings season, I’m feeling concerned… and it seems like I’m not the only one.  My bet is that we can expect volatility in the coming weeks. Our trading strategy over at Profit Amplifier focuses on avoiding risk, and one way we can do that is by adding exposure to utility stocks — a defensive sector that traders turn to when they are looking for low-risk trades.  Time To Get Defensive While looking through my screens, I found a very attractive call option trade in Southern (NYSE: SO), a gas and electric company (and the second-largest utility stock in the United States, in terms of customer base).  #-ad_banner-#Southern’s fundamentals are solid, with cash flow from operations growing steadily. The company is headquartered in Atlanta and serves a part of the country that enjoys relatively stable weather at this time of year, which reduces the risk of a natural disaster disrupting operations. Analysts expect the company to announce earnings around February 21, so picking a call option that expires before then further decreases risk.  The chart confirms my bullish outlook. After recently breaking above its 200-day moving average (MA) — the solid… Read More

The recent stock market sell-off has everyone awaiting the big plunge. After striking new highs, the Dow Jones Industrial Average fell off a cliff earlier this week. Waves of fear gripped the market as pundits debated the reasons for the aggressive selling. Everything from the Supreme Court nominee and Trump to rising interest rates and seasonality have been named as culprits. —Recommended Link— Life-Saving Drug In Phase 3 Trials — FDA Fast Track Our experts have uncovered a small pharmaceutical company with a life-saving drug that virtually cures the deadliest food allergy on the planet. It’s so important that… Read More

The recent stock market sell-off has everyone awaiting the big plunge. After striking new highs, the Dow Jones Industrial Average fell off a cliff earlier this week. Waves of fear gripped the market as pundits debated the reasons for the aggressive selling. Everything from the Supreme Court nominee and Trump to rising interest rates and seasonality have been named as culprits. —Recommended Link— Life-Saving Drug In Phase 3 Trials — FDA Fast Track Our experts have uncovered a small pharmaceutical company with a life-saving drug that virtually cures the deadliest food allergy on the planet. It’s so important that the FDA has given it Fast Track Designation to speed up the review process. We’re talking about a triple-digit opportunity — but only if you act quickly.  Good news could break any day and send the stock soaring! Click here to see why this is the best chance at triple-digit gains we’ve seen in a long time. The Dow dropped nearly 1,400 points over the last two days. However, today, Oct. 12, stocks rebounded sharply. The Dow rose 364.52 points, or 1.46 percent, the S&P 500 rose 1.45 percent, and Nasdaq, which was the hardest hit on Wednesday, gained 2.22… Read More

My favorite scene in Martin Scorsese’s hit movie “Casino” is when Nicky (Joe Pesci) expounds on Ace’s (Robert De Niro) uncanny knack for picking winners. —Recommended Link— The Tech Boom Begins TODAY Today at 1 p.m. EST, legendary tech investor Dr. Thomas Carr is going… Read More

As we begin to close the books on the first half of 2018 — and prepare for second-quarter earnings season — it’s prudent to take stock of where we are. -The earnings multiple of the Standard & Poor 500 Index is 25.07, more than 10 points higher than its historical median of 14.69. Conservative investors might find this as dizzying as I do — it is rich valuation. The current bull market began in March 2009, which was 112 months ago. The average bull market lasts 97 months. -In May, U.S. companies bought back an astonishing $174 billion worth of… Read More

As we begin to close the books on the first half of 2018 — and prepare for second-quarter earnings season — it’s prudent to take stock of where we are. -The earnings multiple of the Standard & Poor 500 Index is 25.07, more than 10 points higher than its historical median of 14.69. Conservative investors might find this as dizzying as I do — it is rich valuation. The current bull market began in March 2009, which was 112 months ago. The average bull market lasts 97 months. -In May, U.S. companies bought back an astonishing $174 billion worth of their own stock. While that might be good for investors, it also reveals a profound law of money: You only get to spend it once! Allocating that pile of cash to buybacks means those dollars aren’t being spent on the capital expenditures that fuel organic business growth. After all, one can’t build a new widget factory if one has blown her allowance on Widget Co. shares. But remember Obermueller’s Law: No number has any meaning without the context of another number. —Recommended Link— More Than 150 Years Of Data Proves This Investment Beats All Others This is the MUST-OWN… Read More

If you’re like most modern-day stock market players, technical analysis likely plays at least a small part in your investment process. Even if you don’t study the charts yourself, you probably read some analysis of “bullish” and “bearish” patterns on stocks you own or are thinking of buying. All stock trading platforms and brokers provide some type of charting software. Some sites even allow you to place orders directly from the chart, making it extremely easy to buy or sell based on the price movement. #-ad_banner-#Things were not always this way. When I started investing, technical analysis was an arcane… Read More

If you’re like most modern-day stock market players, technical analysis likely plays at least a small part in your investment process. Even if you don’t study the charts yourself, you probably read some analysis of “bullish” and “bearish” patterns on stocks you own or are thinking of buying. All stock trading platforms and brokers provide some type of charting software. Some sites even allow you to place orders directly from the chart, making it extremely easy to buy or sell based on the price movement. #-ad_banner-#Things were not always this way. When I started investing, technical analysis was an arcane subject practiced by only the hardest of the hardcore market junkies. The practice was difficult without the help of a PC and real-time data feeds. In those days, investors would painstakingly plot daily prices by hand on graph paper or use charts provided by newspapers or financial publishers. Making things even more impossible was the fact that charts were mostly based on the daily closing price. Investors were forced to plan their trades based on charts that very well may have been out of date by the time the order went through. But today, instant availability, ease of use, and… Read More

Calling a market top is a game for fools and overconfident pundits with no skin in the game. Right now, with the Dow Jones Industrial Average trading around 200 points off its all-time highs, crash calls and bearish sentiment are increasing by the day.   Make no mistake; the market top will print eventually. There are many signals indicating that the top is in or at the very least close.  Smart stock investors will keep an eye to the signs when deciding how to position their portfolios going forward. Even though we don’t know how long the market will keep… Read More

Calling a market top is a game for fools and overconfident pundits with no skin in the game. Right now, with the Dow Jones Industrial Average trading around 200 points off its all-time highs, crash calls and bearish sentiment are increasing by the day.   Make no mistake; the market top will print eventually. There are many signals indicating that the top is in or at the very least close.  Smart stock investors will keep an eye to the signs when deciding how to position their portfolios going forward. Even though we don’t know how long the market will keep pushing higher, utilizing bearish signals as a data point when making decisions is simply intelligent investing.  #-ad_banner-#One of the more widely used sentiment signals has been flashing a top alert for the last several months. This article will explore the indicator, delve into what is happening right now, and provide stocks that have set up to be great shorts.  The bearish indicator is money flow. As capital (money) flows in and out of the stock market, prices fluctuate. While this is common sense and doesn’t mean much on a day-to-day basis, over the longer term trends in money flow can… Read More

There’s something wrong in the stock market. Short-term correlations that were once reliable have been thrown into disarray. Computer-driven trading programs and massive amounts of capital are confusing even the most weathered market skippers. #-ad_banner-#However, long-term correlations remain intact. One of the most reliable market signals, known as Dow Theory, is signaling that investors should dump stocks now.  As the market continues to grind higher, investors would be wise pay attention. Dow Theory has been in use for over 100 years, and is considered to be the basis for most of technical analysis. Originally created by the father of the… Read More

There’s something wrong in the stock market. Short-term correlations that were once reliable have been thrown into disarray. Computer-driven trading programs and massive amounts of capital are confusing even the most weathered market skippers. #-ad_banner-#However, long-term correlations remain intact. One of the most reliable market signals, known as Dow Theory, is signaling that investors should dump stocks now.  As the market continues to grind higher, investors would be wise pay attention. Dow Theory has been in use for over 100 years, and is considered to be the basis for most of technical analysis. Originally created by the father of the Dow Jones Industrial Index, Charles Dow, the theory has undergone very few changes over the last century.  One of the primary tenets of the theory is that indexes must confirm each other to forecast additional upside. Right now, Dow Theory’s most critical index is showing a divergence that is incredibly bearish.  A Closer Look At Dow Theory At its core, Dow Theory is used to clarify trends in the overall direction of the market. The theory breaks down trends into three primary parts. 1. The Primary Movement This is the long-term trend. The Primary Movement can last from… Read More