As of the close of Friday, January 5, 2024, there were no breakouts of high-volume optional stocks and ETFs.
I have attached the Daily and 130-minute picture of SPY using PerfectStorm
Daily:
and 130 Minutes:
Five new breakouts on Monday.
October 16, 2023 by
As of the close of Monday, October 16, 2023, a scan of high-volume options using PerfectStorm found five breakout candidates.
AMZN:
GOLD:
HL:
SPY:
JPM:
SPY Swing trading strategy.
October 3, 2023 by
No new breakouts or breakdowns from Tuesday, October 3, 2023, but the following illustration of SPY, the ETF representing the S&P 500 should illustrated where we have been and what the present looks like.
SPY using PerfectStorm strategy:
Swing trading breakouts
August 30, 2023 by
As of the close of Wednesday, August 30, 2023. PerfectStorm scan of high-volume options found six breakout candidates.
QQQ:
SPY:
T:
TSLA:
EPD:
and PDD:
One swing trading breakout. Market Warning!
August 4, 2023 by
There were no breakouts during the last few days of this week, but there is one breakout as of the close today., Friday, August 4, 2023.
Increasing VXX oftentimes predicts market declines.
VXX:
Perhaps the following illustration of the relative strength between the SPY ETF and the VXX ETF will demonstrate the danger better.
SPY vs VXX:
Another Stock Market Indicator
January 10, 2023 by
In the past, I have illustrated a few ratios that have measured investor sentiment on future stock market direction.
In this post, I will add another, the relative strength between the consumer discretionary sector (XLY ) and consumer staples(XLP).
Historically when the consumer discretionary sector (XLY) outperforms the discretionary sector(XLP), the overall market (SPY) has been bullish.
The relative strength swap doe not always indicates a change, but the trade-off is always worth noticing.
The following is the relative strength of XLY vs XLP with the SPY as of the close of Monday, January 9, 2023.
As illustrated, XLP is still doing better than XLY.
TACK ETF looks like a winner.
December 22, 2022 by
In the current issue (December 2022) of Technical Analysis of Stocks and Commodities, there is an interview with Katie Stockton, a founder,
and managing partner of Fairlead Strategies LLC.
Fairchild, which uses technical analysis as its main focus, has developed a sector-focused actively managed ETF; Fairchild Tactactical Sector (TACK) which started trading at $25.00 on March 22, 2022.
The universe of ETFs for TACK includes the 11 Select Sector SPDRs as well as SPDR Gold (GLD) and SPTL and SPTS, the long and short-term SPDR ETFs.
The fund, according to the article, holds from five to eight positions in the portfolio at any one time.
The fund rebalances, that is, adjusts on a monthly basis. It uses monthly data only.
I assume it uses some sort of relative strength algorithm.
The relative performance to the overall market ETF SPY has been very nice.
The following chart shows that from the funds’ inception to the close yesterday, December 21, 2022.
TACK, from its inception of $25.00 to the close of December 21, 2022, of $23.70 has lost approximately 5.48%, while the SPY on that date was at 446.53 and at the close of December 21, 2022, was at 363.23, a loss of approximately 18.65% Excellent relative performance of plus 13.17% over the approximately eight-month period.
There are numerous ways to trade this rising star ETF. A pair’s trade or outright long when it has high relative strength with positive momentum.
Early Warning Indicator
June 4, 2022 by
This ‘Shoeshine Boy’ Spots Market Tops |
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By Pete Carmasino, chief market strategist, Chaikin Analytics
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| Just before the 1929 market crash, John F. Kennedy’s father stopped to get his shoes cleaned…But the enthusiastic, young shoeshine boy wanted to offer something more – stock tips.That’s all Joe Kennedy needed to hear. In his mind, nothing could indicate a market top better than unsolicited stock advice from a shoeshine boy.The legend says Joe immediately got out of the market. Then, he “shorted” it and got filthy rich.True or not, this story is an investor favorite for good reason. It sends an important warning about market manias.Put simply… a top is near when the proverbial “shoeshine boys” get in on the action.That’s important to remember right now…You see, whether it was intended or not, global investing giant VanEck created a modern-day shoeshine boy investment. And as you’ll see, it called the most recent market top.Let’s take a closer look… |
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| The VanEck Social Sentiment Fund (BUZZ) launched in March 2021.The idea behind the exchange-traded fund (“ETF”) is easy to understand. It invests in 75 mid- to large-cap stocks based on the amount of hype they’re getting on social media. And it’s based on the Buzz NextGen AI U.S. Sentiment Leaders Index…To be considered for the index, companies need a market cap of at least $5 billion. They also need consistent and diverse mentions on social media over the previous year.From there, any stocks that meet the criteria are ranked. The top 75 go into the index.The idea is to use crowd sentiment to find good companies. Essentially, it becomes a momentum index.In short, the index and related ETF are the collective shoeshine boy…The index’s creators use artificial-intelligence (“AI”) tools to track websites like Twitter and StockTwits. These AI bots decipher between good and bad phrases relating to stocks.But it’s an interesting choice, to say the least…On Twitter, 50% of users don’t have a college degree. I’m willing to bet that a much higher percentage don’t even know investing basics. Plus, 92% of posts come from 10% of users.So there you go… That’s your BUZZ Investment Committee.It’s no surprise that the ETF is effectively a “meme stock” fund. Its largest initial holdings included Twitter (TWTR), DraftKings (DKNG), Meta Platforms (FB), and Tesla (TSLA).Investors couldn’t get enough when BUZZ launched in March 2021. Its assets quickly skyrocketed to more than $500 million.But the good times didn’t last long… Today, the ETF only boasts about $75 million in assets.And more importantly, this proverbial shoeshine boy called the latest market top. Look at how BUZZ sputtered out shortly before the broad market took a nose dive… |
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| The ETF is down roughly 48% from its November 2021 peak. And now, the S&P 500 Index is down around 16% from its all-time high back in January.That tells us the shoeshine boy indicator worked yet again.The moral of the story is simple…A bear market was all but guaranteed when BUZZ launched. But now, this tool directly measures the proverbial shoeshine boy for us.As a result, you’ll want to keep an eye on it.Good investing,Pete Carmasino
The above was written on May 17, 2022, in The Chaikin Analytics Power Feed The following is the current status of BUZZ vs the SPY. It is looking like good news. The momentum ratio is now favorable to BUZZ versus SPY, and BUZZ is on an upswing.
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Market Timing, another look
January 27, 2021 by
In one of my former posts, December 7, 2020, I discussed looking at the relative relationship between the bond market and the equity market to gauge investor sentiment. In that post I stated:
“In the past, which is certainly no predictor of future behavior, the movement of the U.S. Treasury note and bond market, has behaved in an almost opposite manner to the equity market. The avoidance of equity risk has shifted the money flow into the safe haven of U.S. Treasuries and vice versa. In the past then, the equity market has been negatively correlated to the Treasury market. So, when equities are getting strong, Treasuries should be getting weaker, etc.”
The following is a chart of SPY and EDV as of the close yesterday, January 27, 2021, and it appears from the attached that the equity market is still in a nice uptrend.
I have added a 200-day exponential moving average to the present illustration.
Some have noted, historically, that when the SPY is considerably above the 200-day moving average, that a correction may occur. Yesterday’s close meets those criteria. In February 2018, prior to a correction, the 200-day moving average was approximately 12% above the index. Yesterday’s close was approximately the same.
Relative Strength
January 12, 2021 by
In the many past posts, I have recommended that to be successful in swing trading, one has to be aware of the individual securities relative strength as it compares to some index of its peers.
The following chart is an example of OIH which is the oil VanEck oil services ETF. I have compared this ETF to SPY, which represents the Standard & Poors 500 index.
The prices are as of the close yesterday, January 12, 2021.
The rules are very simple, and the action indicated by the up and down arrows reflects the result of following the rules.
- Buy when the target security is stronger, on a relative strength basis than the index.
- Buy ONLY when the target is stronger, has positive momentum, and the index is also going up.
- Close the position when any condition is violated. Shown by blue vertical lines.
- The rules apply to shorting when the actions are the opposite of the buy rules.