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Category: 2 – Technical Trader

Lee Adler’s proprietary cycle analysis with market trend and position ideas for investors and weekly individual stock swing trade ideas for traders. Click here to subscribe. 90 day risk free trial!

Our Chart Picks Posted Record Gains Last Week

Last week we had 8 picks on the list, all shorts. 4 of them hit their trailing stops, and were closed out from the list as of that print. Including those and the picks still open at the end of the week gave us average gains of 10% on an average holding period of 19 calendar days. The percentage gain is based on 100% cash positions, with no margin and no use of leverage or options.

This is the best list performance since I began this experiment in 2017. The prior week saw an average gain of 3.3% on 15 picks with average holding period of 10 calendar days.

Previous “best” performances have been a sign to close out, but I will follow the discipline here of merely adjusting trailing stops on the 4 remaining picks. This week I am adding 3 new picks to the list (subscriber version only).

Technical Trader subscribers click here to download the complete report.

The raw daily data for last week ended with a slight edge to the buy side. The final score for the week was 187 to 146 Buys over Sells. That compared with the prior week’s 188-153 in favor of buys.

This is from a universe of approximately1200-1500 stocks daily that meet the criteria of trading above $6.00, and with average volume greater than a million shares per day. The final numbers show the number of stocks with at least one buy signal or sell signal during the week.

The slight edge to the buy side over the past two weeks has not yet been enough to turn the market. It will take much more of a tilt than this to get anything going on the upside. These signals suggest that a choppy rangebound trend remains in force.

On Friday, March 11 alone, there were just 23 buys and 17 sells. Those are low numbers supporting the choppy trading range thesis.

I screened the lists of previous daily buys and sells for the first part of the week, looking for additional signals in the progression on Thursday and Friday. The final lists resulted in 20 chart pick candidates on the buy side and 7 on the sell side. I reviewed those visually. Despite the plurality of buys, the trend structures were weak. There were few setups that looked like good entry points. On the other side, most of the sell candidates were extended near support.

After reviewing all 27 charts, I chose 3 to add to the list, two shorts, and one buy. This was the first buy since one lonely buy on December 6. Other than that, all picks have been on the short side since then. That will leave the list with 6 open shorts and one buy.

The new picks, along with picks that remain open, and those closed out last week, are shown on the table below (subscriber version only). Charts of new and open picks are below that.

The picks that remain open, and those closed out last week are shown on the table below  Charts of open picks are below that.

Technical Trader subscribers click here to download the complete report.

The strategy and tactics opinions expressed in this report illustrate one particular approach to trading. No representation is made that it is the best approach, or even suitable for any particular investor.

These picks are illustrative and theoretical. Nothing in this report is meant as individual investment advice and you should not construe it as such. Trade at your own risk. 

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Weakening Cycle Patterns in Stocks Portend Worse to Come

Cycles – The 6 month cycle should be in a xxxx xxxx xxxx (subscriber version). Here’s why the next low could entail a short term crash.

The 10-12 month cycle projection now points to xxxx (subscriber version), but there’s still room for it to shift over the next 2 months. Indicators for that cycle are at new lows. A potential positive divergence from the market averages has been obliterated.

Technical Trader subscribers click here to download the complete report.

Short term cycle projections now point to xxxx-xxxx (subscriber version), with lows due between now and the end of March.

Third Rail Chart – Trend resistance begins at 4290 on Monday, descending to 4275 and/or 4240 on Friday. If they clear those, then the next resistance zone and target would be the xxxx-xxxx (subscriber version) area.

On the downside there are multiple support lines from 4200 to 4175 this week, with rising long term channel support at 4150. If xxxx (subscriber version) is broken, it’s game over for the bulls.

Long Term Weekly– Long term cycle momentum has joined 3-4 year cycle indicators in signaling a likely bear market.

Monthly Chart – The market now looks unlikely to return to the uptrend channel. Trend support is around xxxx in March. Long term momentum is on a preliminary sell signal.

Technical Trader subscribers click here to download the complete report.

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Not a subscriber? Get price and time targets, and weekly swing trade chart picks, risk free for 90 days!  

These reports are not investment advice. They are for informational purposes, intended for an audience of investment and trading professionals, and other experienced investors and traders. Chart pick performance changes week to week and past performance may not indicate future results, as you know. Trading involves risk, and these reports assume that you understand those risks and manage them according to your tolerance. 

Fewer Picks Remain But Still 100% Short, With Gains

The raw daily data for last week ended with a slight edge to the buy side. The final score for the week was 188 to 153 Buys over Sells. That compared with the prior week’s even-Steven Sells 215, Buys 216. This is from a universe of approximately1200-1500 stocks daily that meet the criteria of trading above $6.00, and with average volume greater than a million shares per day. The final numbers show the number of stocks with at least one buy signal or sell signal during the week.

The shrinking number of total stocks having signals, and the narrow spread between buys and sells, are symptomatic of a rangebound market with no thrust, and no sign of breaking into an up or down trend.

Technical Trader subscribers click here to download the complete report.

However, on Friday, March 4 alone, there were just 17 buys and 65 sells. It suggests that the market may be beginning to tilt toward the bears. A down move on Monday would solidify that.

I screened just the lists of previous daily buys and sells for final signals on Thursday and Friday, looking for a progression of signals through the week. The final lists resulted in only 8 buy signals and 8 sell signals. Another reflection of a market going nowhere.

I examined each of these 16 charts for ones to add to the chart pick list for this week. None of the buys looked interesting. Several of the sells did, mostly financials, but they were trading near major support levels. That’s usually not a propitious entry point to go short. Even if they break down, there is usually a recoil move that’s a better short sale entry.

Last week gave us gains on average on the 15 picks, all shorts, that were open to start. This was despite closing out 7 picks with losses. They were all shorts. Four of them, I had decided to close as of Monday’s open. The rest hit the stops I had suggested. That left 8 picks still open, again, all shorts.

Including both the closed picks and those still open, the list had an average gain of 3.3% on an average holding period of 10 calendar days.

There are no new picks, so we will start this week with just those 8 shorts still on the list. They all have gains. I adjusted the trailing stops that are intended to close out picks as they are hit.

The picks that remain open, and those closed out last week are shown on the table below (subscriber version only). Charts of open picks are below that.

Technical Trader subscribers click here to download the complete report.

The strategy and tactics opinions expressed in this report illustrate one particular approach to trading. No representation is made that it is the best approach, or even suitable for any particular investor.

These picks are illustrative and theoretical. Nothing in this report is meant as individual investment advice and you should not construe it as such. Trade at your own risk. 

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Why I Don’t Care that Short Term Indicators Are Bullish

Cycles – Cycles are mixed and opposed, expressed as a rangebound market that is likely to xxxx xxxx xxxx (subscriber version).. The timing and direction of a breakout xxxx xxxx

Short term cycles are opposed, with neither dominant. The 13 week cycle is in a weak up phase due to peak at any time this month. The 6 month cycle low is due between now and May. The cycle projection was xxxx xxxx (subscriber version). The 10-12 month cycle has been dormant and it’s not clear when xxxx xxxx xxxx. Indicators for that cycle are borderline, but still in a downtrend.

Technical Trader subscribers click here to download the complete report.

Third Rail Chart – The bottom of a short term uptrend channel rises from roughly xxxx to xxxx (subscriber version) in the week ahead. If that line is broken, the larger downtrend would be in charge.

To keep a short term uptrend going, the market would first need to clear a resistance cluster around xxxx xxxx . Then it would need to clear an intermediate downtrend line that would be at xxxx on Friday. Barring that, the downtrend remains in force.

Long Term Weekly– Long term cycle momentum has joined 3-4 year cycle indicators in signaling a likely bear market.

Monthly Chart – The market now looks unlikely to return to the uptrend channel. Trend support is around xxxx in March. Long term momentum is on a preliminary sell signal.

Cycle screening measures – The current pattern is neutral to slightly bullish short term, and xxxx to xxxxxxx xxxxxx on the intermediate and longer term trends. Cycle breadth-momentum weakened throughout the rally last year, and continues to do so.

Technical Trader subscribers click here to download the complete report.

Subscription Plans

Not a subscriber? Get price and time targets, and weekly swing trade chart picks, risk free for 90 days!  

These reports are not investment advice. They are for informational purposes, intended for an audience of investment and trading professionals, and other experienced investors and traders. Chart pick performance changes week to week and past performance may not indicate future results, as you know. Trading involves risk, and these reports assume that you understand those risks and manage them according to your tolerance. 

Swing Trade Chart Picks Go Haywire

The raw daily data for last week ended in a virtual tie. The final score for the week was 216 to 215 Buys over Sells. That compared with last week’s Sells 212, Buys 101. These numbers count stocks with at least one buy signal or sell signal during the week.

As a result of the big rally, on Friday, February 25 alone, there were 203 buys and 17 sells. That came out of the blue and was enough to even the score for the week.

Technical Trader subscribers click here to download the complete report.

I screened just the lists of previous daily buys and sells for final signals on Thursday and Friday, looking for a progression of signals through the week. I ran screens on these lists to create the final list for visual review for chart picks.

The final lists resulted in just three buy signals and 9 sell signals. I looked at each of these 9 charts for ones to add to the chart pick list for this week. Zilch. The charts were a mess – completely inconclusive upon visual review.

9 final signals is an extremely low number. It leaves me thinking that the previous week’s sell signals may still have some life, despite the strong rally on Friday, and other signs of a possible bottom in the broad market indicators.

Last week got off to a great start, then KABOOM, the market zoomed upward, and many of the shorts on the list got squeezed. The end result was a mixed performance, essentially a breakeven, with an average holding period of 7 calendar days.

3 of the picks will be treated as covered as of today’s opening price. The rest have new or adjusted stops. I will use trailing stops to close out picks as they are hit.

The picks that remain open, and the ones to be closed at today’s open are shown on the table below (subscriber version only). Charts below that.

 

Technical Trader subscribers click here to download the complete report.

The strategy and tactics opinions expressed in this report illustrate one particular approach to trading. No representation is made that it is the best approach, or even suitable for any particular investor.

These picks are illustrative and theoretical. Nothing in this report is meant as individual investment advice and you should not construe it as such. Trade at your own risk. 

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A Bottom, of Sorts

The stock market seemed to make a 13 week cycle low in the expected time window late last week. But as we watch in horror as Putin brutally attacks Ukraine, it’s natural to wonder if this will stick. My guess is that we’ll see ….. (subscriber version)

On the other hand, the disruption to the world system of bank transfers and locking down Russian central bank foreign exchange transactions are unknowns. Fed and ECB intervention are certain, but uncertain in whether they’ll impact the stock market in terms of preventing a crash. Right now, the charts suggest that crash risk has been xxxx xxxx xxxx (subscriber version).

We’ll see. I’m not going to pretend to know the unknowable. Day traders will need to trade the minute charts. The rest of us should try to stay disciplined in doing what the daily charts tell us. The big increase in volatility, which is very short term wave amplitude, makes that difficult. It’s a sign that liquidity is drying up. That ain’t bullish. That’s for sure.

Technical Trader subscribers click here to download the complete report.

Cycles – The 13 week cycle has probably xxxx xxxx xxxx (subscriber version) along with xxxx xxxx xxxx. The initial projection is xxxx.

The 6 month cycle may also be bottoming. The projection of xxxx was hit, but there are no indicator confirmations yet.

The 10-12 month cycle has been largely dormant for a couple of years, and it’s not clear when a bottom is due on this down phase. However, the projection of xxxx seems solid.

Third Rail Chart – The market would have to break a trendline that ends the week at xxxx (subscriber version) to signal the end of the intermediate downtrend. On the downside, the first likely support area would be around (subscriber version), with a test of xxxx possible.

Long Term Weekly- Long term cycle momentum has joined 3-4 year cycle indicators in signaling a likely bear market.

Monthly Chart – The market now looks unlikely to return to the uptrend channel. Support is around xxxx in February, and approximately xxxx in March. Long term momentum is on a preliminary sell signal.

Cycle screening measures rebounded last week. The rally is suspect because it wasn’t preceded by a positive divergence in this indicator. The indicator is also well below the past several highs. Therefore, the short term pattern is still bearish. Last week’s low was also lower than the last short term low. This follows a series of lower highs. Therefore the intermediate pattern is also bearish.

Technical Trader subscribers click here to download the complete report.

Subscription Plans

Not a subscriber? Get price and time targets, and weekly swing trade chart picks, risk free for 90 days!  

These reports are not investment advice. They are for informational purposes, intended for an audience of investment and trading professionals, and other experienced investors and traders. Chart pick performance changes week to week and past performance may not indicate future results, as you know. Trading involves risk, and these reports assume that you understand those risks and manage them according to your tolerance. 

Fourteen New Shorts, No Buys

The raw daily data for last week as a whole tilted strongly to the sell side for a second straight week. The final score for the week was Sells 212, Buys 101. That’s for stocks with at least one buy signal or sell signal during the week. For the previous week there were 63 charts with at least one buy signal and 195 with at least one sell signal. On Friday, February 18 alone, there were 9 buys and 75 sells.

Technical Trader subscribers click here to download the complete report.

I screened just the lists of previous daily buys and sells for final signals on Thursday and Friday, looking for a progression of signals through the week. I ran screens on these lists to create the final list for visual review for chart picks. The final lists resulted in just one buy signal, a real estate brokerage (go figure). There were 48 charts with a sell signal on Thursday or Friday, after sell signals earlier in the week. I looked at each of these 48 charts for ones to add to the chart pick list for this week.

Of the 48 charts with multiple sell signals, I found 14 that I liked well enough to add to the list as shorts. These are shown on the table below. I will track them as of the opening price today (Tuesday Feb 22). Charts below (subscriber version only)..

The two picks from last week were a split decision. I’ll treat XXXX (subscriber version only). as covered on the open today, and will record the loss on that. On average, the two picks had a gain of 4.4% with a holding period of 8 calendar days.

Technical Trader subscribers click here to download the complete report.

The strategy and tactics opinions expressed in this report illustrate one particular approach to trading. No representation is made that it is the best approach, or even suitable for any particular investor.

These picks are illustrative and theoretical. Nothing in this report is meant as individual investment advice and you should not construe it as such. Trade at your own risk. 

Subscription Plans

Crash is Now a Coin Flip

The odds of a stock market crash are typically extremely low. But on rare occasions a setup develops where a crash becomes a distinct possibility. The odds in favor of one increase to a point where it’s almost a coin flip.

Technical Trader subscribers click here to download the complete report.

This is one of those times. This report shows you why, and the most likely outcomes over the next few weeks and months (subscriber version). .

On top of the technical aspects, the liquidity/monetary environment, is hostile. Inflation is raging and the Fed has been placed in panic tightening mode. Under almost no circumstances that I can imagine, will this end well.

Cycles All swing cycles are in gear xxxx xxxx xxxx (subscriber version).. There’s still potential for xxxx xxxx xxxx into the 6 month cycle low due in xxxx xxxx xxxx.

Projections now range from xxxx for the 4 week cycle, down to xxxx for the 10-12 month cycle.

A 13 week cycle low is due xxxx xxxx xxxx (subscriber version), at a projection of xxxx . However, short cycle lows aren’t ideally due until xxxx. The 6 month cycle bottoming window runs from xxxx – xxxx.

Third Rail Chart – The test of the low has begun. That’s at 4222.62. Before they get there, there are support levels indicated around xxxx xxxx xxxx (subscriber version).. The bottom of the short term channel starts the week around xxxx  and drops to around xxxx on Friday. The centerline of the intermediate channel starts the week at xxxx and drops to around xxxx on Friday. The trend will remain weak if it stays below that line. To break the short term downtrend channel, the market would need to clear xxxx by Friday.

Long Term Weekly– The 3-4 year cycle oscillator has rolled over, signaling a bear market. Both long term cycle momentum and 3-4 year cycle momentum are on the verge of breakdowns that would signal both a cyclical and secular bear market, especially if this coincides with a weekly close below xxxx (subscriber version).. That would complete a major top pattern with a measured move target of xxxx xxxx for the first leg of the bear market.

Monthly Chart – The market now looks unlikely to return to the uptrend channel. Support is around xxxx in February, and approximately xxxx in March. Long term momentum is on a preliminary sell signal.

Cycle screening measures The cycle screening aggregate ended last week at -911. It’s a sign.

The cumulative line is now in position to break both the January and October lows. It would be bearish confirmation of the downtrend in price.

Technical Trader subscribers click here to download the complete report.

Subscription Plans

Not a subscriber? Get price and time targets, and weekly swing trade chart picks, risk free for 90 days!  

These reports are not investment advice. They are for informational purposes, intended for an audience of investment and trading professionals, and other experienced investors and traders. Chart pick performance changes week to week and past performance may not indicate future results, as you know. Trading involves risk, and these reports assume that you understand those risks and manage them according to your tolerance. 

New Shorts To Be Our Bear Valentines

Technical Trader subscribers click here to download the complete report.

We came into last week with an empty list thanks to inconclusive screens and chart patterns. That was probably a good thing, considering the sharp reversal on Thursday.

The raw daily data for last week as a whole tilted strongly to the sell side thanks to Thursday and Friday’s action. For the week ended Friday there were 63 charts with at least one buy signal and 195 with at least one sell signal. On Friday alone, there were 11 buys and 114 sells.

I screened just the lists of previous daily buys and sells for final signals on Thursday and Friday, looking for a progression of signals through the week. The final lists resulted in just one buy signal, a gold miner, and 14 charts with a sell signal on Thursday or Friday, following sell signals earlier in the week. I eyeballed these 15 charts for ones to add to the chart pick list for this week.

First I want to mention the one buy, XXXX (subscriber version. I loved the long term pattern, but the setup was not a low risk entry short term, so I did not add it to the list. I wanted to, but since this is a short term swing trading exercise, and this looked short term risky, despite its long term potential, I didn’t. Take that for what it’s worth. If you’re a gold bug, you’ll probably find it interesting.

Now, the short sale candidates… Surprisingly, there were few with great low risk setups. Of the 14 final sells, most had been in downtrends for at least several weeks, and were near major support. They could break down on this move, but I’d rather wait to short them on the next rebound. If this is the bear market that I think it is, there will be many better opportunities ahead to go short. And if it’s not the bear market that I think it will be, the list’s risk exposure will be limited to the two stocks I’ve selected, shown below. Charts below.

The table of new picks, as well as open and closed picks, last week along with charts of new and open picks are in the report  (subscriber version only).

Technical Trader subscribers click here to download the complete report.

The strategy and tactics opinions expressed in this report illustrate one particular approach to trading. No representation is made that it is the best approach, or even suitable for any particular investor.

These picks are illustrative and theoretical. Nothing in this report is meant as individual investment advice and you should not construe it as such. Trade at your own risk. 

Subscription Plans

Beware! The Market Has Followed My Script

Technical Trader subscribers click here to download the complete report.

xxxx xxxx xxxx (subscriber version)

Why beware? Well, usually, when the market does exactly what I have posed as the likely outlook for a few weeks, the time is about due for us to get a good slap in the face as a reminder to stay humble.

The other reason is that if I continue to be right, this market will get a lot worse fast. That’s great if you are short stocks, and ranges toward terrible depending on how long you are. If you are a “long only,” money manager and you’re all in cash, then you might end up feeling pretty good too.

But the temptation will be to buy the dip. The success of that will depend on both your market timing and your holding period horizon. This is not your same old, same old, Fed policy driven bull market any more.

Remember Rule Number One. Don’t fight the Fed.

Cycles There are signs that 13 week and 6 month cycles xxxx xxxx xxxx (subscriber version). However, xxxx xxxx phases are also periods of higher vulnerability for sharp declines into the low. Short term cycles are xxxx . The 4 week cycle is in a xxxx xxxx. The 6-7 week cycle has not xxxx xxxx but it appears to be xxxx xxxx xxxx. That suggests an xxxx xxxxxxx xxxx if the market follows through on xxxx xxxx .

Third Rail Chart – All of the conditions of the outlook we had for the last two weeks have been met. Now, there’s an interim support level at 4390-4400. If it holds, xxxx xxxx xxxx (subscriber version). If it breaks, the next area to look for support would be around xxxx xxxx.

Long Term Weekly– The market made a typical intermediate term xxxx xxxx xxxx (subscriber version). by breaking a long term wave channel, then xxxx xxxx xxxx. Given the rollover in the 3-4 year cycle indicators, the rebound in the market suggests only a limited xxxx xxxx xxxx.

So far, there’s no material change in the long term projections of xxxx xxxx xxxx (subscriber version), but I now believe that they are wrong and will not be met. I’m giving these no weight, and instead focusing on the price patterns, support breaks, and cycle indicators to show us the way.

Monthly Chart – The market now needs to be above xxxx (subscriber version) at the end of February to get back into the two uptrend channels. Failure to do that would imply the beginning of top formation. If that does not happen, the target in February would be (subscriber version).

Cycle screening measures are in a short term bearish configuration, with the intermediate term leaning (subscriber version). Market weakness this week would (subscriber version). A rally this week would suggest (subscriber version). A bear market 6 month cycle up phase would be much shorter and cover less ground than a bull market up phase.

Technical Trader subscribers click here to download the complete report.

Subscription Plans

Not a subscriber? Get price and time targets, and weekly swing trade chart picks, risk free for 90 days!  

These reports are not investment advice. They are for informational purposes, intended for an audience of investment and trading professionals, and other experienced investors and traders. Chart pick performance changes week to week and past performance may not indicate future results, as you know. Trading involves risk, and these reports assume that you understand those risks and manage them according to your tolerance. 

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