Tag Archives: $QQQ

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2016 Triple Play Charts End of Year Review

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Those who follow my Triple Play Charts regularly on Stocktwits and Twitter know this as one of the momentum based trend gauges we use to guide us through the markets.  I post the same two charts every day which on one hand can get monotonous, but I feel the consistency keeps us updated on the ever changing view of the markets while also helping teach us the personality traits that can give clues in the future.  I wanted to do an end of year review.  In this exercise I take a look from the quarterly view using Index charts (since the ETFs don’t really go back far enough to use my indicators at this level) and methodically move down to the 65 minute chart that is part of the daily routine. Let’s get started.

(for those new to these charts you can learn more about them here and here)

Quarterly (Index)1-1-2017-9-10-42-am-tp-qrtly-index

This level is for a 50000 foot view or a very long term investor.  Don’t forget as we move down each time frame how much time each one devours to make a new candle.  This quarterly chart is made up of the $RUT $NDX and $SPY since the $IWM $QQQ $SPY ETFs don’t have enough history to complete the charts.  These cover the last 26 years of data give us a view of the long term uptrends we are seeing across all three at this point.  This uptrends started in 2009, but do not signal the start of this bull market in my opinion.  The recent consolidations on this chart I believe can serve as reset which means the new bull markets is less than 15 months old by most measures. The biggest detractor here is the $NDX ended the year with a d0ji with RSI elevated, but also firing a high level RSI Positive Reversal as this chart finally breaks above the 2000 highs.  Even elevated, the RSI Positive reversal  suggests the move might not be ready for a larger consolidation just yet.  The $SPX chart also shows an RSI over 70, but a new longer term CFG Positive Reversal fired there as well in 2016.  Finally, the $RUT is coming out of a long consolidation with a +20% drawdown or bear market and now has its own RSI (tighter) and CFG (longer term) Positive Reversals firing as it closed the year on a strong breakout.  RSI are elevated but still acting pretty strong and all CFGs are turning up without making it down to Oversold territory.

Monthly1-1-2017-9-06-45-am-tp-monthly

The Monthly ETF charts are all in RSI bull ranges and have been since late 2009 for $IWM $QQQ and late 2010 for $SPY.  We have seen a few deeper pullbacks along the way (especially in $IWM) but all in all the longer term RSI bull ranges have held very well and CFG getting to or near Oversold levels has serves as decent entries.  All of the RSIs have been trending higher since early 2016 and are just now moving back over 60 giving lots of room to move higher if they want it.  We even saw the $QQQ & $SPY hit the Nitrous Button closing the year with $IWM not far behind and trying to play catch up.  Divergences are potential here and would be a warning, but I believe it is too early to start that talk until they form a little better.  The biggest warning I see here is the waning CFG here before getting over the 100 level showing a loss of ST momentum into the end of the year, but the elections might have been a culprit there.  The Monthly RSI bull ranges are fully intact after being tested in early 2016 and now heading back higher over 60. Many will see this a sign of getting overbought, but a strong RSI can run for longer than most believe. The set up here remains one of strength with potential to continue higher.

Weekly1-1-2017-9-03-27-am-tp-weekly

The Weekly level is where things start to get a little more wiggly as larger black candles have began to show up.  $IWM & $SPY look fairly extend and could easily pull back some or flag a while longer without much if any damage to the higher time frames.  The RSI aren’t particularly Overbought, but are rolling over a little here. Interestingly the $IWM & SPY are also hitting the Nitrous here which always catches my eye. I want to see if these pullback remain muted and just flag from here.  $QQQ is in a little different spot just breaking out and now backtesting those previous highs with RSI finding some resistance at 60.  A successful backtest here could set the tone for all the major indexes in on this level. Weekly charts are starting to show signs of a reversal or consolidation, but too early to tell how it will materialize. I would cue on $QQQ & $IWM to dictate market direction in the early part of the year.

Daily12-30-2016-4-03-14-pm-tp-daily

The Daily view shows after consolidation most of December after the early surge with $QQQ struggling to hold the recent range break.  All three are still in RSI bull ranges.  $QQQ looks the weakest, but if it can reverse with RSI remaining above 40 and without turning down the MA bands it will be a good sign.  $IWM $SPY still have a good ways to go to test RSI 40, but they don’t have to get all the way there, a reversal at 50 is fine and might be all we see with almost 3 weeks of sideways to down action behind us here. One thing I do like seeing is the faster CFG getting close to Oversold levels without seen a lot of damage to the RSI. if the CFG can reverse form Oversold before the RSI break their bull ranges (40) then it can often lead to a nice move higher to continue the trend.  A reversal of trend can strike at any time, but all with all the higher time frames still in RSI bull ranges, we are watching to see if the daily charts can hold their respective RSI bull ranges on this consolidation.  If so, the trend can continue higher sooner than later, but if they fail we can move a little more cautious and wait for them to set back up and align themselves again.  The 1st tell her is likely the $QQQ since it is already pressing down on some important levels to start the year.

65 minute12-30-2016-4-07-27-pm-tp-65min

The 65 minute view gives us a good breakdown of intraday price action which is currently losing momentum and ground as all these charts are in RSI bear ranges to start the year and need a move back over RSI 60 and the MA bands to improve the picture.  Until that happens the burden of proof is on the buyers to show up and take charge of things.  The $IWM looked the best into the close with multiple divergences showing and the best RSI & CFG levels, but that is not saying much.  $SPY & $QQQ both look extended to the downside short term, but it will take some heavy lifting to shift these back to RSI bull ranges.  That said, being an intraday chart, that lifting can be done within a day if aggressive enough, but is more likely to take a few days to week to play out and see if a shift back to the upside can happen before we pull the Daily charts into larger downtrends.

Good Luck and I hope this helps!

If you like what you see, follow me on StockTwits or Twitter.
(All market data above are derived from Stockcharts.com, Esignal, and Reutersdatalink)
The information set forth here was obtained from sources which we believe to be reliable, but we do not guarantee its accuracy.  Neither the information, nor any opinion expressed constitutes a solicitation by us of the purchase or sale of any securities or commodities. I or my affiliates may hold positions or other interests in securities mentioned in the blog.  Full Disclaimer
There is no guarantee that the views expressed in this communication will become reality,  Investing in the stock market involves risk and potential loss of principal, Investment strategies should be thoroughly researched and understood before implementing and none of this should be construed as a recommendation

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Triple Play Drill Down

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With Friday’s close of the quarter, let’s take a quick look down this weekend.  In Technical Analysis we talk a lot about looking at one or more time frames higher than the one you trade to get the bigger picture; similarly, this top down process looks at all the time frames to help us adjust our near term outlook and holding periods based on which levels are working better in the current market environment.   If you are not familiar with my TP charts you can start with a these two posts here and here to learn more.

TP Index* Quarterly10-2-2016-11-07-26-am-tp-quarterly

Starting at the highest levels we can see the strength the major indexes have seen since the 2009 lows, but nothing here on the RSI chart that screams that is ending.  All three had strong candles this quarter and are on Nitrous in RSI bull ranges showing on this long time frame buyers are still in control.  The RSI do remain elevated with $QQQ closest to 80, but in strong trends moves over 80 are better overbought signals normally.  The CFGs in the bottom pain are also turning back up here before reaching oversold which also suggest the trend is still in the bull’s camp.  This timeframe is helpful, but will take a long time to change character which makes it less directly relevant to most traders

TP Monthly10-2-2016-11-13-12-am-tp-monthly

Dropping down to the monthly view, we still see all in RSI bull ranges moving back over 60 recently and not overbought. $SPY $QQQ have already moved to new highs and backtested those in the case of $SPY.  $IWM is not quite there yet, but has been the strongest move off the February lows.  If October can buck the seasonality and see $IWM break to new highs it would be a pretty big deal and could fuel these RSIs to overbought before done, but again intra-month volatility can still be high enough to frustrate many out of good opportunities.

TP Weekly10-2-2016-11-15-37-am-tp-weekly

ON the weekly level, once again we see all three on Nitrous in RSI bull ranges, but not really near overbought territory on any of them yet.  This level shows the recent breakouts and backtests on $QQQ and $SPY which proved to be successful so far.  The CFG’s all just recently turned back up with $IWM and $QQQ not even breaking 50 on the pullback.  It is the $SPY charts that is beginning to lag from this level.

TP Daily9-30-2016-4-01-22-pm-tp-daily

The daily view is where we can really start to see the chop over the last couple of weeks that has created the volatility in both directions, without either side gaining any traction.  Here to we see the $IWM is the only one that never lost the RSI bull range in September.  $QQQ broke RSI 40 barely, but snapped right back in what we call a range spike.  This is when officially the bull or bear range in RSI is broken, but quickly moves back over RSI 60 to confirm the bull range is still intact.  In the Weekly time frame I mentioned the spy $SPY was lagging which comes into clearer focus as we move down to the daily level.  The $SPY is the one of the three that actually looks like it could be shifting into a RSI bear range, but with it being the only one there yet, we want at least one of the others to join it before it gets more concerning.  Overall the grind off the September lows has been good to see from a strength standpoint.

TP 65min9-30-2016-4-06-12-pm-tp-65min

The 65min Charts actually shifted back into RSI bull ranges in mid September and are currently still holding them even among the chop we have seen.  Friday’s closing candle does look ugly here and will be watched, but until we lose the MA bands and the RSI bull ranges break here the this level continues to support that move off the lows this month.  Don’t read too much into that last candle as quarter end could have a bit of squaring going one.  Monday will be here soon enough and our next set of candles will bring the next clues for us to work from.

After going through this drill down, the one thing that stands out to me the most is almost every chart on every time frame is currently in a RSI bull ranges and moving higher.  Contrast this AAII bulls nearing the lows this suggests to me the wall or worry is still out there even with the progress the markets and their charts have made this year since forging those February lows.  Now you know my views, feel free to incorporate that into yours any way you like and as always, I hope it helps!

Have a great week!

If you like what you see, follow me on StockTwits or Twitter.
(All market data above are derived from Stockcharts.com, Esignal, and Reutersdatalink)
The information set forth here was obtained from sources which we believe to be reliable, but we do not guarantee its accuracy.  Neither the information, nor any opinion expressed constitutes a solicitation by us of the purchase or sale of any securities or commodities. I or my affiliates may hold positions or other interests in securities mentioned in the blog.  Full Disclaimer
There is no guarantee that the views expressed in this communication will become reality,  Investing in the stock market involves risk and potential loss of principal, Investment strategies should be thoroughly researched and understood before implementing and none of this should be construed as a recommendation

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Dissecting The Markets with the Triple Play

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At the end of May my post Pick Your Poison was about looking at different timeframes and realizing choosing a time frame to focus on can dictate how you view the markets. I also discussed it was an exercise I like to each month.  I find it especially helpful after months like July that shake things up a bit and give us some extra volatility.  It can help ground my views by stepping back and moving from the longer time frame step by step down to the short-term.  So, let’s take a look.  If you are not familiar with my RSI charts you might take a quick peak at this RSI chart explanation video

Monthly8-1-2015 7-01-37 AM TP Monthly

On the monthly chart we have a steep trend in all 3 major ETFs we follow as they are well above the riding MA bands.  $IWM is least extended coming off the breakout from the flag that was 2014.  the July $IWM candle is a bearish engulfing pattern to watch in August, but using the blended candle approach with the last two months would give you a doji which goes well with the indecision we have seen so far this summer.  $SPY $QQQ had both been moving consistently higher until the last couple of months where they began to see more volatility creep in.  All three are still in strong RSI bull ranges.  $IWM is the laggard, but $SPY & $QQQ both are sporting new RSI Positive Reversals after closing higher this month.  All have relatively neutral CFG readings.  The trends are still up and don’t look to be in much danger at the moment.

Weekly8-1-2015 6-59-36 AM TP Weekly

The weekly level shows a little more of the volatity we have witnessed.  $IWM showing the most, $SPY looks more like a flag or box consolidation and the $QQQ aren’t showing any quit.  All three are coming off their MA Bands and in RSI bull ranges with none of the RSI or CFG overbought. Note how steady the trend in $QQQ has been while it has worked off the overbought readings of late 2013.  RSI works better as a trend indicator than moment if you learn to use it as such.  Weekly charts are consolidating but are still configured to favor higher prices.  no major damage to these charts yet.

Daily7-31-2015 9-31-26 PM TP Daily

It is in the Daily charts where we start to see the differentiation more. $IWM is currently the laggard and in a RSI bear range.  However, the $SPY and $QQQ both remain in bull ranges for now and the $SPY successfully held at the recent lows.  The volatility really starts to show up on this level showing the daily battle that was July.

65 minute7-31-2015 9-36-53 PM TP 65min

Drilling down to the 65min level we can actually see all of July’s trading activity 65 minutes at a time.  It was a bit of a roller coaster with the $IWM trajectory down while the $SPY $QQQ were more constructive.  $SPY was iffy for a while, but pulled it out in this last week. All three ended the month with RSI bull range shifts and trying to find support on now rising MA bands.  This is not a strong thrust so far so we need to keep an eye and see if RSIs can move above this week’s peaks for a more convincing range shift or will it fail and show we need more time to regroup before moving to and through the highs?  One good note here is CFGs are falling faster than RSI was on Friday which can be a positive.  More tentative shift back higher on this level;  Okay for now, but needs to build on it early next week to survive.

30minute8-1-2015 7-04-15 AM TP 30min

The 30 minute view shows all three are in RSI bull ranges, moving well off the lows. Friday ushered in a small pullback within the bull ranges.  The week closed with RSI pulling back within a bull range while CFG are getting oversold at or below zero and price is finding some support at the MA bands.  Until we lose the bull range the 30min level looks constructive and could be ready for another move out of the gate on Monday.

5 minute8-1-2015 7-05-22 AM TP 5min

As we get down to the very short-term, the 5 minute charts shows the Friday afternoon dropped blew through the bull ranges and are all now recovering back near the 50 level on RSI.  The trajectory is higher, but being in the bear range and below the MA bands we know a failure is very possible which could leave us with RSI Negative Reversals here showing this timeframe does need more time before it can shift back.  If a failure does happen and the RSI bear range holds it is certainly not the end of the world as this is a 5 minute view after all.  It could delay that move we talked about on the 30 minute for a while or outright negate it, but let’s get there first. The lower the time frame the more shifts we have and the less important they are unless that is the time frame you trade on.

As I said above after a month that can pull you in different directions and leave you a little uncertain, it can help to take a step back and drill down your time frames one by one and see what you can see which should allow us to better plan for the upcoming month.

Good Luck and I hope this helps!

If you like what you see, follow me on StockTwits or Twitter.
(All market data above are derived from Stockcharts.com, Esignal, and Reutersdatalink)
The information set forth here was obtained from sources which we believe to be reliable, but we do not guarantee its accuracy.  Neither the information, nor any opinion expressed constitutes a solicitation by us of the purchase or sale of any securities or commodities. I or my affiliates may hold positions or other interests in securities mentioned in the blog.  Full Disclaimer
There is no guarantee that the views expressed in this communication will become reality,  Investing in the stock market involves risk and potential loss of principal, Investment strategies should be thoroughly researched and understood before implementing and none of this should be construed as a recommendation

 


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RSI Chart Explained – Video

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Below is a video to explain all the information available in my RSI Charts.  These charts are the basis for the Triple Play Charts as well as other posts on this blog.  If you want more in depth RSI review be sure to check out The RSI Series as well.  Also if you want a printable explanation you can find it at Breaking Down the Triple Play Chart

If you like what you see, follow me on StockTwits or Twitter.
(All market data above are derived from Stockcharts.com, Esignal, and Reutersdatalink)
The information set forth herein was obtained from sources which we believe to be reliable, but we do not guarantee its accuracy.  Neither the information, nor any opinion expressed constitutes a solicitation by us of the purchase or sale of any securities or commodities. I or my affiliates may hold positions or other interests in securities mentioned in the blog.  Full Disclaimer
There is no guarantee that the views expressed in this communication will become reality,  Investing in the stock market involves risk and potential loss of principal, Investment strategies should be thoroughly researched and understood before implementing and none of this should be construed as a recommendation.

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