Posts Tagged ‘ATR’
America’s Retail Markets: Part V
I have decided to add another installment in this series before the final overview chapter is written. And indeed, it can not be written until we examine the United States’ leading retail foods giant, Wal-Mart.
Wal-Mart is now in the midst of a daily downwards fan pattern as shown on the Daily Chart below. This pattern can be somewhat unstable at the end, and it indeed seems to be nearing its’ end. It can break upwards and is likely to given the fresh upwards trends taken by the retail companies mentioned in my 2 previous articles. These are fresh trends and recently the 1st two articles’ stocks has started an upwards trend as well. Wal-Mart’s price level has been at or below the lower bounds of the Bollinger Bands, showing a tendency of over-selling, since the fan has started. The RSI is also right by the 30 level which is, basically, sold-out. The buyers may come, and probably soon, technically speaking. But economically this will rely on the major companies’ sales, revenue and profit margins as quoted in their next fiscal reports.
There seems to be good times ahead for the Retail Markets, as shown by the Bollinger Bands showing their crossing of the price levels, and the indicators that show oversold prices on the way in the Weekly Chart below. As I said, the RSI is sold-out and ready to accept buyers, or rather “bargain hunters”. And the Average True Range, or ATR is low indicating little intra-day changes in prices and signaling a breakout soon. Do not act in any way on this “tip” because there is no breakout yet. Watch your charts daily and, when you see a true pattern break, then it is more wise to act on.
This is the way the Weekly Chart looks:
Share and Enjoy
America’s Retail Markets: Part IV
Since our last installment of this series, Gymboree, a Physical Fitness retail company and one of the largest in its’ field, has stopped the daily downtrend it was in and established technically what was looking as a weekly and even monthly upwards trend (see charts below). It has hit the Bollinger Bands upper bounds, a sign of excess power that needs respite, and has this week bounced off the fresh trend-line that is both weekly and monthly, successfully.
The RSI is in a good intermediate territory. The ATR, or Average True Range, shows the true ranging of prices across the time line and an upswing in the making. When the ATR heads in an upwards direction, as is the case now, this foretells a good upswing in the making.
We intend to bring you a fifth part to this series, examining the Economic view of the Retail market as it stands to date. What this segment means to the US Economy and the world as a whole, and dissect technically some Market Sector ETFs from the US Retail Markets to try to determine the trends that may be taking shape in this, likely the most important market segment in the US Market and therefore a leading indicator of where the world may be headed.
Remember, this is a definate buying opportunity, but only for the middle to long term investor. Those who tend to become emotionally involved with trading and are constantly counting dollars and cents are not for this trade. Also for this type of trading you need deeper pockets to be able to absorb a larger stop-loss. At any rate the risk-reward factor here is almost 1:5 with a chance to gain in long-term monthly time-frame investing of as much as 25% which is not bad for 8-15 months or less work.
This is the way the Weekly Chart looks:
This is the way the Monthly Chart looks:
Share and Enjoy
S&P on a roll? Just Another Baloney Sandwich!
One would have thought, before Friday, that the sky’s the limit and that the S&P 500 was looking so good you could taste it. Many cafe’s in Downtown Manhattan were offering “S and P on a roll” and people were buying it up from them like hotcakes. It is now 3 p.m. Greenwich Daylight Time as these lines are written, on Sunday, April 18, 2010. And, I have one thing to make perfectly clear. All of the parameters at my disposal are pointing to one conclusion: the roll has turned, overnight, into a rotten egg. The RSI in red and Roc in blue below the chart, both showing oversold parameters on this last S&P roll, have double-backed very quickly into their more normal levels and have thus both started a downward trend themselves. And the S&P 500 itself has made a technical ruckus by showing an unusually large and thick (open to close values) downwards RED Japanese Candle, its’ daily length loss being much higher than the ATR (Average True Range) that measures the daily length of candles as a moving average over, in this case, 34 days, for a longer-term vantage-point. One can see that the ATR, in blue below the chart, has gone down to very small values. This large red candle that was expected because of the length of the rally and the fact that it hit a major long-term resistance line level, has however astonished most analysts by having a much larger body than usual, and also capping off a 3 day Japanese Candlestick pattern known as “An Evening Star”. When this is combined with the fact that the 61.8% Fibonacci line is also so close, it can be said with some certainty that we are witnessing the end of the rally and a major top after which we may see a real downtrend, although, in my opinion, it will be over within a few weeks to a few months and should not be too deep. After that I expect to see the S&P 500 repair back to itself from the correction and go eventually to new highs, although that may take some time.
