Wednesday, October 04, 2006
Technical Indicators
Momentum
By measuring the amount that a security's price has changed over a
given time span, the Momentum indicator provides an indication of a market's
velocity and to some degree, a measure of the extent to which a trend still
holds true. It can also be helpful in spotting likely reversal points.
While the mathematics are straightforward (subtract the closing price n days
ago from the closing price today), do not underrate its value because of its
simplicity.
Use the Momentum indicator as a trend-following oscillator similar to the MACD
and buy when the indicator bottoms and turns up. Sell when the indicator peaks
and turns down. When the Momentum indicator reaches extremely high or low
values (relative to historical values) assume a continuation of the current
trend...
Read More...
NASDAQ Chart of the Day
WYNN
is approaching a major lower trend line at 65.00, which has remained in tact
since last October. A downside break through this line could be huge for bears.
Watch this zone closely.
Daily Trading Signals
NYSE Chart of the Day
COP
has gotten a huge downside break through major support at 57.00 via a breakaway
gap. This support level had previously remained in tact since June of 2005, so
a downside break here is huge. Watch for big weakness to follow.
Daily Trading Signals
Trading Education
Tutorial
Double Tops and Bottoms
Waiting for the Setup to Complete Results in Profits
There are various chart patterns that help us find good reversal
candidates. Of the major reversal patterns, the double top or bottom is not
only one of the most recognizable, but also one of the most predictive.
Read
More...
Daily Market Commentary
Updated Tuesday, 10/3 for Wednesday's market
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Key DOW Levels for 10/4
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UP
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Above 11,775
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DN
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Below 11,650
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Record Close
- Dow Dow hits all-time highs, remains beneath key 11,750 zone.
The index pierced through 11,750 to set an all-time intraday high and
eventually closed at 11,727.34, which is also a record for the Dow.
- The NASDAQ and S&P each pulled back from early lows to follow the Dow's
lead today. However, each of these indexes continues to look weak compared to
the Dow, which could pull the broader market down.
Summary
The Dow finally set all-time intraday and closing highs today, but could be on
the verge of a retracement. Continued overall strength should be seen above
11,650, but a breach of this zone could spark big selling ahead.
Read More...
