One of the most powerful market indicators is giving us a strong message this week. This indicator is the “bearish rising wedge.â€? A bearish rising wedge is a technical pattern that is formed as a stock price moves higher on decreasing volume, as the daily trading range becomes more and more narrow. The chart below of the S&P 500 is a great example of the wedge. This pattern fools a lot of investors. Since the stock price is advancing, investors often misinterpret the pattern as bullish. However, the wedge usually […]

  Since 2002, the US dollar has been on a major decline with the index falling from 120 to 75.  During this time, the Euro has risen dramatically with most other global currencies.  Notice the inverse relationship between the dollar and the euro.          Over the past 2 months, a major reversal has begun.  The dollar has been on the rise while global currencies have been falling.                Much of this change in trend is due to the weakening global economic situation which will eventually prompt […]

In tonight’s grad call, we looked at ‘Performance Charts’ on www.stockcharts.com.  The great advantage to performance charts is that they allow us to examine relationships between market variables…ie: Gold and Oil.  This examination from a technical level allows us to break through analyst hype and political rhetoric while understanding how to profit from different market relationships.    Let’s say we want to see if the price of gold and oil are correlated.  To do this, we need the ticker symbols for gold and oil.  Most major industry tickers can be […]

In tonight’s call, we discussed various candlestick patterns as signs of short term trend reversals.  As you learn and use candle patterns, please remember that they are most effective when used with other technical tools as confirmations.  Below we have 2 of the  candle patterns that were discussed.  The data is pulled from www.candlesticker.com and a list of the other patterns discussed can be found at that website.    We also looked at http://stockcharts.com/def/servlet/SC.scan.  This page can be accessed through the menu at www.stockcharts.com.  This page shows daily scan results of […]