Tech Talk for Wednesday October 31st 2018

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Pre-opening Comments for Wednesday October 31st

U.S. equity index futures were higher this morning. S&P 500 futures were up 26 points in pre-opening trade.

Index futures moved higher following release of the October ADP Employment report at 8:15 AM EDT. Consensus was 195,000 versus a revised 218,000 in September. Actual was 227,000

Facebook gained $7.32 to $153.55 after reporting higher third quarter revenues.

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General Motors gained $2.61 to $36.15 after reporting higher than consensus third quarter sales and earnings. The company also raised guidance.

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eBay (EBAY $) is expected to open higher after reporting higher than consensus third quarter sales and earnings.

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Amgen (AMGN $) is expected to open higher after reporting higher than consensus earnings.

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EquityClock’s Daily Market Comment

Following is a link:

http://www.equityclock.com/2018/10/30/stock-market-outlook-for-october-31-2018/

Note seasonality chart on the Case/Shiller Home Price Index.

 

Observations

Early technical signs of a short term bottom in U.S. equities have appeared Short term momentum indicators for the equally weighted S&P 500 ETF turned higher from deeply oversold levels yesterday.

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Short term momentum indicators for selected sectors (Banks, Autos) also show turned higher from deeply oversold levels.

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StockTwits Released Yesterday@EquityClock

Visa $V, a Dow Jones Industrial stock moved below $132.26 setting an intermediate downtrend.

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Technical action by S&P 500 stocks to 10:00: Mixed. Intermediate breakouts: $UA $UAA $HCP. Breakdowns: $STZ $RIG $V $ECL

Editor’s note: After 10:00 AM EDT, breakouts included SPG, LB, SBAC and JWN. Breakdown: SRE

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Pembina Pipelines $PPLCA moved below $42.31 extending an intermediate downtrend.

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Trader’s Corner

Equity Indices and related ETFs

Daily Seasonal/Technical Equity Trends for October 30th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Commodities

Daily Seasonal/Technical Commodities Trends for October 30th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

Sectors

Daily Seasonal/Technical Sector Trends for October 30th 2018

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Green: Increase from previous day

Red: Decrease from previous day

 

S&P 500 Momentum Barometer

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Short term technical evidence that the S&P 500 Index may have reached a bottom. The Barometer gained 6.00 to 22.20 from a deeply oversold level yesterday.

 

TSX Momentum Barometer

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The Barometer improved 1.66 to 13.69 yesterday. It remains deeply intermediate oversold, but significant evidence of a bottom has yet to arrive.

 

Disclaimer: Seasonality and technical ratings offered in this report and at

www.equityclock.com are for information only. They should not be considered as advice to purchase or to sell mentioned securities. Data offered in this report is believed to be accurate, but is not guaranteed

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13 Responses to “Tech Talk for Wednesday October 31st 2018”

  1. Mary Says:

    Ana:

    Could you please give me an update on Twitter (TWTR) My chart showing overbought. Thanks.

  2. Ana Says:

    #1. Mary,

    My short term day trading chart shows that it is overbought as well.

    However, if you have a look at full stochastics, %K is 88 and %D is 84.42 so that is when both might embed above the 80 line and continue upward.

    The market looks like it will rebound here after a backcheck.

    Do you day trade this or are a long-term holder? Maybe someone might be able to give you a better long-term viewpoint.

  3. Mary Says:

    Ana

    I cannot or do not know how to post the chart. But its a daily chart of StockChart,
    EMA 5, RSI 8 and MACD 5,35,4. Someone did FB chart for me a while back and all I do is change the symbol. RSI for TWTR now at 78.61 but earlier it was higher. I now added full stock and see what you are saying. I do not have a time frame for selling, take profits as it comes. Thanks again.

  4. Ron/BC Says:

    Mary
    Here’s a chart of TWTR. Price has bounced off the April low support of $26 much like most stocks bouncing off their support levels. But price is now testing resistance at $36 and is also overbought looking at most oscillators. The overall chart pattern is a bearish Head & Shoulder pattern with the neckline at $26. A break below there would suggest a selloff to the 2017 lows or lower. A breakOUT above $36.15 that held would suggest a rally to the $42 to $47 highs. The Modified MACD trend indicator has curled back up and crossed its 10ema which is positive but it is also below its zero line meaning the 20ema is below the 50ema. And the long term Modified MACD is testing the zero line and looks like it’s curling up which would be long term bullish. I know what I’d do if I owned the stock but that is for you to decide. Don’t know why you are holding this stock as it doesn’t pay a dividend according to this chart’s info. If you have a profit you should consider taking it near $36 resistance and if the selloff continues consider buying it at $26 support. What I have noticed today is most stocks including the CD banks have tested important price support and bounced but many are losing their gains for the day and are closer to their lows of the day suggesting this selloff may not be over.

    https://stockcharts.com/h-sc/ui?s=TWTR&p=D&yr=2&mn=0&dy=0&id=p33252453399&a=628367664

  5. Ron/BC Says:

    Mary
    Here is a one year chart of TWTR. Much easier to trade off of but you still need to watch the two year. I put on your indicators plus a couple of mine which you can delete if you wish. But you should be able to switch stock symbols and use the chart with these indicators. With the Modified MACD indicators you wont be able to put in the horizontal blue zero line. So you can just change them to 20,50,10 and 50,200,20 which will give you a similar chart and tell you whether the emas are above or below each other for trend direction. Something I noticed with the 3 indicators on the chart is all 3 have converged which is rare. In a book called The Magic of Moving Averages it points out when you see 3 moving averages such as these converge together expect a big move up or down. Just something to think about……………..

    https://stockcharts.com/h-sc/ui?s=TWTR&p=D&yr=1&mn=0&dy=0&id=p25466288654&a=628367664

  6. Mary Says:

    Ron/BC

    Thanks for the explanation and chart. I managed to save the chart as you posted even though I am not a subscriber to SC, hopefully it doesn’t disappear tomorrow. I made 80K in a short while in 2018 only to see 50% disappeared so I am trading faster, taking profits not waiting long term. Just sold Twitter, and moved on. Thanks again and Happy Trading.

  7. Ron/BC Says:

    Mary
    Prices always fall much faster than they rise as a rule so locking up a solid profit and moving on is always a good idea. And if you like a stock and the group it’s in for whatever reason you can always sell it and at some point when it pulls back buy it back if the reason for buying it is good. Or pick another one in that group that’s taking its turn on running up. This isn’t marriage. Amazes me how attached some people get with stocks. You’d think it’s an addiction or an affair or something,lol. So good luck with the trading and try not to give back so much next time. I’m not a big believer in stop losses as the big boys can stop you out near support levels. But you do have to know when to exit more than anything else. And just like fishing the fish are always there. A famous trader once said “Even if you just sit there you still get run over.”

  8. Mary Says:

    Ron/BC

    Thanks for your words of wisdom.

    “Prices always fall much faster than they rise”, very true. The loss was very fast and furious. I froze and was hoping the market would turn around but after a while it was too late. I will recover it later. I do not place stop loss as well but after this loss will reconsider. For some unknown reason I cannot save the one year chart you posted, I replaced the “TWTR” symbol with my new pick CGC because I do not want to replace the first chart.

  9. Ron/BC Says:

    Well just take the two year chart and change it to one year and it should be much the same. But when you see price run straight up almost and get very overbought it works well to take off 1/2 your position or even 1/3 so if you do get a waterfall selloff and exit you will have captured a nice profit with the early selling you did. And if the stock runs straight up don’t be concerned about missing out. That’s a recipe for disaster. It doesn’t matter if you sell at a great profit and price then doubles or triples. As long as you take a nice bite before it has a chance to selloff you can’t go too wrong. There are thousands of stocks and ETFs to choose from and are always there and take their turns on running up. I’ll try to post this one year chart again. I did screw it up as it should have saved both charts and didn’t.

    https://stockcharts.com/h-sc/ui?s=TWTR&p=D&yr=1&mn=0&dy=0&id=p25466288654&a=628367664

  10. Sherri Says:

    Armstrong:
    “Now that we have arrived at the end of October, the Directional Change that came into play yesterday and the support encounter in the Dow in terms of Euro, everything was still in play that we would not create a major change in long-term trend. In the Dow, we would nee a monthly close today to come in under 23995 and we have generated a What-If Monthly Bullish for October at 25588.

    Welcome to what appears to be a staging ground. Keep in mind that even a Democratic win in the House would only prevent any reform so we will still see the flight of capital from Public to Private asset classes perhaps even pick up steam.”

  11. Mary Says:

    Sherri
    Thanks for the update.

  12. Ana Says:

    Where does one start?

    Armstrong is delusional about reform helping Americans. Perhaps the reform he is speaking about will only benefit himself. I think that is a narrow-minded viewpoint.

    Here is information regarding the Republican taxation bill and who will benefit from it.

    https://www.vox.com/2017/12/20/16790040/gop-tax-bill-winners

    Corporatocracy is a term used to refer to an economic and political system controlled by corporations or corporate interests. Perhaps this is the state that Armstrong desires.

    There will be an economic pullback in the near future, but it will be the result of higher interest rates diminishing the ability of people to purchase goods. That is the greatest opponent for capitalism. It is not social programs or what people call “socialism”. People not being able to afford to purchase anything will pull the Americans down in a spiral.

  13. Ana Says:

    $SPX Futures

    https://invst.ly/91weh

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