Skip to main content

Up and down Thursday - Swing Signals, Trend Busters and Trend Leaders for July 30, 2009

The NASDAQ gapped up today but couldn't hold its intra-day highs. No gap on the S&P 500 but otherwise a similar performance. Stocks ran up early, gave ground late in the day but still finished with decent gains. This seemed about right as the morning rally seemed to me to be a bit overdone. Catalysts today included a Goldman Sachs upgrade for GE, a beat by Motorola and a decrease in the unemployment rate. Weekly initial claims climbed for the second week in a row but still managed to stay below 600,000. Decent news but not worth a 2% rally as we saw in the morning. Stocks still managed to finish up around 1% which is nothing to complain about.

The view from Alert HQ --

Our list of Trend Leaders has finally gotten above 1000. This is a good indication of the bullish sentiment that is prevelent but it gets us closer to the kind of extreme levels that presage a pullback.

As we saw on Tuesday, we have more SELL signals than BUY signals on our list of Swing Trading Signals. This kind of action has been seen before a pullback.

Our Trend Busters list is shrinking but, in contrast to our Swing Signals, shows more BUY signals than SELL signals

For the most part, our signals reflect a high level of bullishness. The weakness in our Swing Signals is no surprise as, prior to today, stocks had stopped their mad rush to new highs. So I'm pretty happy to see the bullish tone but I'm worried about how some of these signals are getting that look - the kind of look that suggests new highs will be harder to come by and stocks could be ready to turn down again.

Friday we get the advance look at GDP for for the second quarter. That could be a big market mover if it blows away expectations on the upside or disappoints big on the downside. Anything in between is liable to be a let down and we could see stocks give up today's gains.

Thursday's Signals --

Today we have the following:
  • 27 Swing Signals -- consisting of 10 BUY signals and 17 SELL Signals.
  • 1018 Trend Leaders, all in strong up-trends according to Aroon, MACD and DMI. There are 242 new stocks that made today's list and 221 that fell off Tuesday's list.
  • 14 Trend Busters of which 12 are BUY signals and 2 are SELL signals
Using the signals --

As a humble practitioner of technical analysis, I admit that every signal can't be correct. Alert HQ can, however, provide a filtered selection of likely candidates from which investors can choose. Remember, if you're a momentum trader, the Trend Leaders list is a good place to go shopping. If you practice technical analysis, check out the Trend Busters. And if you are a short-term trader or even a day trader, our Swing Signals may provide some good trading ideas.
Labels:

Comments

Post a Comment

Popular posts from this blog

Time to be conservative with your 401K

Most of the posts I and other financial bloggers write are typically focused on individual stocks or ETFs and managing active portfolios. For those folks who are more conservative investors, those whose main investment vehicle is a 401K, for example, the techniques for portfolio management might be a little different. The news of stock markets falling and pundits predicting recession is disconcerting to professional investors as well as to those of us who are watching our balances in an IRA or 401K sag. What approach should the average 401K investor take? Let's assume that the investor is contributing on a regular basis to one of these retirement accounts. There are two questions that the investor needs to ask: 1. Should I stop putting the regular contribution into stocks? My feeling is that investors making regular contributions are being handed a present by the markets. Every week the market goes down, these investors are lowering their average cost. When markets reco...
7 comments
Read more

The Trouble with Trend Reversal Indicators

Many of us use various trend reversal indicators to time our trades. Our desire is to determine when prices have changed direction so that we can ride the new trend. Why doesn't it always work out? The first reason, of course, is that unforeseen events often drive prices in unexpected directions. That is something we can't change and it often makes all of us technical traders crazy. On the other hand, sometimes an unforeseen event is a prelude to a new trend. A stock spikes up on a what seems to be a one-time piece of good fortune and soon falls back. Does it start making its way back up or does it resume a previous down trend? The conflict within trend reversal indicators is that, though they can definitely tell when prices change direction, they suffer from two problems. One, they often can't determine how significant that move in prices actually will be. Two, they are often lagging indicators. As such, they can be late in providing a signal, sometimes leading the investo...
1 comment
Read more

Brazil - in a bubble or on a roll?

A couple of years ago, no one recognized the real estate bubble even though it was under everyone's nose. Now, analysts and bloggers are seeing bubbles everywhere they look. One of them, they say is in Brazil whose Bovespa stock market index has doubled in the last 12 months. Does the bubble accusation hold water? I don't think so and here are 7 reasons why Brazil is by no means a bubble economy: Exports have held up over the past year thanks to demand from China for Brazil's soya exports and iron ore. This was helped by the the Brazilian government's drive to improve trade links with Asia and Africa. Export diversification, spurred by a more active trade policy and increased focus on "south-south" trade under current president Lula, helped mitigate the decline in demand from OECD (Organization for Economic Co-operation and Development) countries A "sensible" economic framework has been in place since the 1990's. This has included inflation ...
4 comments
Read more