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Chart Patterns: Flag and Pennants

By Steve Hill

President, AIQ Systems

Stephen Hill is President of AIQ Systems. For the past 15 years he has been involved in all aspects of AIQ Systems, from support and sales to programming and education. Steve is a frequent speaker at events in the U.S. and Europe, talking on subjects as diverse as Portfolio Simulation TechniquesAdvanced Chart Pattern Analysis and Trading System Design.

Chart pattern analysis, often thought of as part science part art is a key element in many traders decision process. Common patterns like double tops and bottoms are somewhat self-fulfilling, given that most of us can see these patterns occurring. Measures of what consititues a double top or bottom in good analytical terms we’ll save for another article. In this this article we are focussing on two of my favorite chart patterns; Flags and Pennants

Flags and Pennants are Consolidation or Continuation Patterns

These patterns break out in the direction of the previous trend, confirming the existing trend, suggesting that investors are considering whether the market is overbought or oversold but ultimately deciding to confirm the existing trend. Flags and pennants are of two types, bullish or bearish

Flags and pennants are generally considered continuation patterns as they breakout in the prevailing trend direction. They represent a brief pause especially after a steep run up in an active ticker. They are a fairly common and useful for short term trading.

Bullish Flags – formation

Lower tops and lower bottoms bounded by two parallel trendlines with pattern slanting against the prevailing trend are considered bull flags (figure 1).


Figure 1Bullish flag pattern

Bearish Flags – formation

Higher tops and higher bottoms bounded by two parallel trendlines with pattern slanting against the prevailing trend are considered bear flags. (figure 2).


Figure 2Bearish flag pattern

Elements of bullish flags

  • A rapid and steep price rise of around 20% from bottom of the pole to top.
  • Decreasing volume during the formation of the flag.
  • Breakout occurs to the upside with resumption of increase volume levels
  • Flags length excluding the pole classic should be around 10 days, can be less but not more than 20 days.
Figure 3. Whole Foods Market, Inc (WFMI) bullish flag


Bulkowski noted that the high and tight flag performed best. (source Encyclodpedia of Chart Patterns by Thomas Bulkowski).
2Some 25% of the patterns are horizontal notes Markos Katsanos. (source Measuring Flags & Pennants: Technical Analysis of Stocks and Commodities vol 23 no 4)bullish flag breakout on increased volume note the pole length is 20% + of the price action and the diminishing volume on the flag.


Elements of bearish flags

  • A rapid and steep price decline of around 20% from top of the pole to bottom.
  • Decreasing volume during the formation of the flag.
  • Breakout occurs to the downside with resumption of increase volume levels.
  • Flag length excluding the pole should be around 10 days, can be less but not more than 20 days.

Figure 4 shows MNST classic bearish flag breakout on increased volume note the pole length is 20% + of the price action and the diminishing volume on the flag.

Bullish Pennants – formation

Pennants look very much like symmetrical triangles, on the end of a pole, typically they are smaller in size and duration (figure 5).

Bearish Pennants – formation

An upside down bullish pennant, the triangle is at the bottom of the pole. (figure 6).

Elements of bullish pennants

  • A rapid and steep price rise of around 20% from bottom of the pole to top.
  • Decreasing volume during the formation of the pennant.
  • Pennants look like symmetrical triangles on a pole, price action is converging.
  • Diminishing volume as pennant forms.
  • Breakout to the upside with re- sumption of volume levels.
  • Pennant length excluding the pole should be around 10 days, can be less but not more than 20 days.Figure 7 shows CDW classic bullish pennant breakout on increased volume

Figure 7CDW Computer Centers (CDW) bullish pennant

Elements of bearish pennants

  • A rapid and steep price drop of around 20% from top of the pole to bottom.
  • Decreasing volume during the formation of the pennant.
  • Pennants look like symmetrical triangles on a pole, price action is converging.
  • Diminishing volume as pennant forms.
  • Breakout to the downside with resumption of volume levels.
  • Pennant length excluding the pole should be around 10 days, can be less but not more than 20 days.

How do you trade flags and pennants?

Katsanos study of Flags and pennants revealed that the average breakout was 45% over an average period of 11 days. Bulkowski noted a 63% average gain. to trade these breakouts, set tight stops at low of day before breakout and use trailing stops once breakout occurs.

Target prices are more difficult to predict as these are continuation patterns, but after 11 days you are beyond the average move in days.

AIQ tip

Once a breakout occurs, use AIQ space on right of the chart (rtalerts only) and advance 11 days into the future. Draw a trendline parallel to the pole trend from the breakout point.

The Bartometer

May 5, 2019

Hello Everyone

2019 has rewarded us with average portfolio returns in a Moderate portfolio category between 8-14% so far since January 1, 2019*. A Moderate portfolio is a mutual fund portfolio with approximately 50-60% stocks and 30-40% bonds.

MARKET RECAP:

Since last month my computer models see the trends of the stock markets as Somewhat Cautious. Most of the sectors of the markets are at or near the old high of last September except:

  • The healthcare sector is down 7% from last year’s high
  • The small-cap sector is down 7%
  • The midcap sector is down 3% and a few more.However, overall, the indexes are at or near their old high, and this is where we need to address as to whether the markets will breakout or top out here and head lower. With the markets up so much from the lows in December, stocks are overdue for some consolidation following the major rally this year and at its old highs of last September**.
  • **See charts below as to whether the markets are overvalued and could sell off or continue to rise.

Where do we stand from an economic stance?

  1. The economy is still doing well:
    • Job growth is outstanding with 263,000 new jobs created last month
    • Unemployment at 3.6% is the lowest it has been in decades, and most economic measures are overall healthy.
    • The tax reduction to corporations is making earnings rise
    • The USA is enjoying the best overall economy in the world currently.Most of the economic surveys conducted suggested that the main problem with the markets is uncertainty with trade with China. The uncertainty could positively drop the markets down if the Trade War is not resolved in a positive outcome. Our economy has risen on an overall uptrend for about ten years, and it is overdue for a recession sometime over the next 1.5 to 3 years, but nothing seems to be on the horizon in the very near future.
  2. Interest rates remain relatively stable, and the most likely near-term outlook is for continued stability.

Index Averages

Some of the INDEXES of the markets both equities and interest rates are below. The source is Morningstar.com up until May 4, 2019. These are passive indexes.

*Dow Jones+13.57%
S&P 500+17.59%
NASDAQ Aggressive growth+22.20%
I Shares Russell 2000 ETF (IWM) Small cap+20.10%
International Index (MSCI – EAFE ex USA)+13.10%
Moderate Mutual Fund+10.20%
Investment Grade Bonds (AAA)
+4.88%
High Yield Merrill Lynch High Yield Index+7.68%
Floating Rate Bond Index+5.17%
Fixed Bond Yields (10 year)+2.55% yield
The average Moderate Fund is up 10.2% this year fully invested as a 60% in stocks and 40% in bonds.*Explanation of each on the last page

If interest rates are peaking and look to be flattening or declining over the next year then investment grade or multisector bonds technically might be better than floating rate bonds. But diversification is important.

Source: AIQ TradingExpert Pro

The S&P is above. Notice the trend line in white. The technical indicators are Somewhat Cautious, in addition, this is not a time to add a good deal of money to the market. If you can see the white horizontal line at the top of the picture you will see that it corresponds with the high hit last September in the market. The old high hit on May 1, 2019 of 2954 intraday has to be broken through with a lot of volume or the S&P 500 could start to rollover. IMPORTANT, If 2904 is broken on close I will be getting more Cautious, if it closes below 2886, I will be getting Very Cautious as it would have clearly broken the 2019 Trend line. At that point, there would be some Buying support at 2852 its 50 day moving average.

The next graph underneath the S&P 500 shows the Momentum of the market is flattening out. This is also an indicator that the market is still good, but losing a little of the upside momentum and could fall here.

THE BOTTOM LINE:

The S&P 500 is right at its old high it hit last September. Traders are looking at this area very carefully as to whether it will break out of the 2954 number and follow through on the upside. I am Cautious on the market unless the S&P 500 rallies above the 2954 level on the S&P 500 and stays above that level for a least 2 to 3 days. If the S&P 500 closes below 2886 I would reduce some equity exposure as it would have broken a significant trend line and could push the S&P in a downtrend again. As for interest rates, they are back down to 2.55% on the ten-year bond. The tariff situation if not resolved would give investors a chance to sell and push the market lower. Other than that outside of ongoing political issues, the economy is doing relatively well, and a recession is not on the horizon, at least not over the next year. If you are a longer-term investor, stay the course, if you are in or nearing retirement, you may want to sell 10% of your holdings and rebalance your portfolio.

*A Support or support level is the level at which buyers tend to purchase or into a stock or index. It refers to the stock share price that a company or index should hold and start to rise. When a price of the stock falls towards its support level, the support level holds and is confirmed, or the stock continues to decline, and the support level must change.

Source: Investopedia

Support levels on the S&P 500 area are 2910, 2850, 2800, 2766, 2676 and 2600 areas. These might be BUY areas.

Support levels on the NASDAQ are 7979, 7801, 7572, and 7410.

On the Dow Jones support is at 26,240, 25856, 25,471 and 25,120. These may be safer areas to get into the equity markets on support levels slowly.

RESISTANCE LEVEL ON THE S&P 500 IS 2740. If there is a favorable tariff settlement, the market should rise short term.

Best to all of you,

Joe

Joe Bartosiewicz, CFP®

Investment Advisor Representative

Contact information:

Joe Bartosiewicz, FP®5, Colby Way Avon, CT 06001

SECURITIES AND ADVISORY SERVICES OFFERED THROUGH SAGE POINT FINANCIAL INC., MEMBER FINRA/SIPC, AND SEC-REGISTERED INVESTMENT ADVISOR.

Charts provided by AIQ Systems:

Technical Analysis is based on a study of historical price movements and past trend patterns. There is no assurance that these market changes or trends can or will be duplicated shortly. It logically follows that historical precedent does not guarantee future results. Conclusions expressed in the Technical Analysis section are personal opinions: and may not be construed as recommendations to buy or sell anything.

Disclaimer: The views expressed are not necessarily the view of Sage Point Financial, Inc. and should not be interpreted directly or indirectly as an offer to buy or sell any securities mentioned herein. Securities and Advisory services offered through Sage Point Financial Inc., Member FINRA/SIPC, an SEC- registered investment advisor.

Past performance cannot guarantee future results. Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Please note that individual situations can vary. Therefore, the information presented in this letter should only be relied upon when coordinated with individual professional advice. *There is no guarantee that a diversified portfolio will outperform a non-diversified portfolio in any given market environment. No investment strategy, such as asset allocation, can guarantee a profit or protect against loss in periods of declining values.

It is our goal to help investors by identifying changing market conditions. However, investors should be aware that no investment advisor can accurately predict all of the changes that may occur in the market.

The price of commodities is subject to substantial price fluctuations of short periods and may be affected by unpredictable international monetary and political policies. The market for commodities is widely unregulated and concentrated investing may lead to Sector investing may involve a greater degree of risk than investments with broader diversification.

Indexes cannot be invested indirectly, are unmanaged and do not incur management fees, costs, and expenses.

Dow Jones Industrial Average: A weighted price average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ.

S&P 500: The S&P 500 is an unmanaged indexed comprised of 500 widely held securities considered to be representative of the stock market in general.

NASDAQ: the NASDAQ Composite Index is an unmanaged, market-weighted index of all over the counter common stocks traded on the National Association of Securities Dealers Automated Quotation System

(IWM) I Shares Russell 2000 ETF: Which tracks the Russell 2000 index: which measures the performance of the small capitalization sector of the U.S. equity market.

A Moderate Mutual Fund risk mutual has approximately 50-70% of its portfolio in different equities, from growth, income stocks, international and emerging markets stocks to 30-50% of its portfolio indifferent categories of bonds and cash. It seeks capital appreciation with a low to moderate level of current income.

The Merrill Lynch High Yield Master Index: A broad-based measure of the performance of non-investment grade US Bonds

MSCI EAFE: the MSCI EAFE Index (Morgan Stanley Capital International Europe, Australia, and Far East Index) is a widely recognized benchmark of non-US markets. It is an unmanaged index composed of a sample of companies’ representative of the market structure of 20 European and Pacific Basin countries and includes reinvestment of all dividends.

Investment grade bond index: The S&P 500 Investment-grade corporate bond index, a sub-index of the S&P 500 Bond Index, seeks to measure the performance of the US corporate debt issued by constituents in the S&P 500 with an investment grade rating. The S&P 500 Bond index is designed to be a corporate-bond counterpart to the S&P 500, which is widely regarded as the best single gauge of large cap US equities.

Floating Rate Bond Index is a rule-based, market-value weighted index engineered to measure the performance and characteristics of floating rate coupon U.S. Treasuries which have a maturity greater than 12 months.

Short Term Corporate Bond ETFs seek to track the shorter maturity side of the corporate bond market. These are debt securities issued by companies and can include investment-grade debt, lower-quality junk or high-yield bonds. Short-term bonds are generally defined as those with maturities of less than five years coupon U.S. Treasuries which have a maturity greater than 12 months.

The 10year Treasury note is a debt obligation issued by the United States government with a maturity of 10 years upon initial issuance. A 10year Treasury note pays interest at a fixed rate once every six months, and pays the face value to the holder at maturity.

Our market AI down signal 4/18/19

AI issued a market down signal of 99 on April 18, 2019. price Phase, our custom indicator that we use to confirm ratings turned down 4 days after the rating. Usually we like to see this indicator turn down closer to the rating, but the AI Expert system is often a little early.

The two significant rules rules that fired on this 99 down are below

“Intraday high prices of the market have increased to a 21 day high. Never the less, the advance/decline oscillator is negative. This unusual event is read as a very strong bearish signal that is often followed by an downward price movement. “

“Intraday high prices of the market have increased to a 21 day high. But the up/down volume oscillator if negative. In this uptrending market, this is taken as a very strong bearish signal that is often followed by downward price movements. “

The prior AI rating on the market was a 100 up on March 11, 2019 the market moved up over 850 points to the April down signal. Here are the AI rules that fired for this rating

“The market closing average has exceeded the 21 day exponentially smoothed average price. At the same time, accumulation is increasing in a strong down market. This is taken as a bullish signal that could be followed by a reverse in trend direction. “


“The Money Flow Indicator has reversed and is now advancing. In this downtrending market, this is taken as a weak bullish signal that could indicate an upward movement in the market averages. “


“Analysis of the rate of change of the exponentially smoothed average price suggests that in this strongly downtrending market an uptrend is starting to form. This is taken as a strong bullish signal that is usually followed by an upward movement in prices. “


“The new high/new low indicator has reversed to the upside. This is a reliable bullish signal that is often followed by an upward movement in prices. In this strong downtrending market a reverse in trend could start shortly. “

Ultimately any AI down signal is a note of caution in this market.

The V-Trade, Part 7: Technical Analysis—V-Wave Count

Counting waves in price charts doesn’t have to be complex. In this seventh part of a multipart series of articles, we consider a method that simplifies the art of counting waves so you can make more successful trades.
The AIQ program has a built-in zigzag indicator that is similar to the one discussed in Sylvain Vervoort September 2018 S&C article, “The V-Trade, Part 7: Technical Analysis—V-Wave Count.” This indicator is demonstrated on an AIQ chart below.

Sample Chart

AIQ. This demonstrates the built-in zigzag indicator on an AIQ chart of SPY.

—Richard Denning
info@TradersEdge­Systems.com
for AIQ Systems

BACK TO LIST

The V-Trade, Part 6: Technical Analysis —Divergence Indicators

AIQ EDS code based on Sylvain Vervoort’s August 2018 S&C article, “The V-Trade, Part 6: Technical Analysis—Divergence Indicators,”
This sixth part of a multipart series continues with a look at the stochastic RSI indicator (SRSI) to identify divergences… is available below

The code is shown here:

!The V-Trade Part 6 !Author: Sylvain Vervoort, TASC Feb 2019 
!Coded by: Richard Denning
!www.TradersEdgeSystems.com

!INPUTS:
stochLen is 5.
stochSum is 8.
rsiW is 21.

!RSI WILDER:
U is [close]-val([close],1).
D is val([close],1)-[close].
rsiLen is 2 * rsiW - 1.
AvgU is ExpAvg(iff(U>0,U,0),rsiLen).
AvgD is ExpAvg(iff(D>=0,D,0),rsiLen).
rsi is 100-(100/(1+(AvgU/AvgD))).
hiRSI is highresult(rsi,stochLen).
lowRSI is lowresult(rsi,stochLen).
RSIlow is rsi - lowRSI.
RSIhilow is hiRSI - lowRSI. ema1 is simpleavg(RSIlow,stochSum).
ema2 is simpleavg(RSIhilow,stochSum).
sveStochRSI is (ema1/(ema2 + 0.1))*100.

Figure 7 demonstrates the indicator on a chart of IBM.

Sample Chart

FIGURE 7: AIQ. The sveStochRSI is shown on a chart of IBM.

—Richard Denning
info@TradersEdgeSystems.com
for AIQ Systems

The V-Trade, Part 5: Technical Analysis—Moving Average Support & Resistance And Volatility Bands

The AIQ EDS file for Sylvain Vervoort’s July 2018 article in S&C, “The V-Trade, Part 5: Technical Analysis—Moving Average Support & Resistance And Volatility Bands,” can be obtained on request via email to info@TradersEdgeSystems.com. The code is also available below.

!THE V-TRADE, PART 5
!Author: Sylvain Vervoort, TASC July 2018
!Coded by: Richard Denning 11/15/18
!www.TradersEdgeSystems,com

!ABBREVIATIONS:
C is [close].
C1 is valresult(C,1).
C2 is valresult(C,2).
C3 is valresult(C,3).
C4 is valresult(C,4).
C5 is valresult(C,5).
C6 is valresult(C,6).
C7 is valresult(C,7).
C8 is valresult(C,8).
C9 is valresult(C,9).
C10 is valresult(C,10).
C11 is valresult(C,11).
C12 is valresult(C,12).
C13 is valresult(C,13).
C14 is valresult(C,14).
C15 is valresult(C,15).
C16 is valresult(C,16).
C17 is valresult(C,17).
C18 is valresult(C,18).
C19 is valresult(C,19).
PD is {position days}.
PEP is {position entry price}.

!MOVING AVERAGES:
!SIMPLE MOVING AVERAGES:
smaLen1 is 50.
smaLen2 is 100.
smaLen3 is 200.
esaLen is 20.
esaBandPct is 10.

sma1 is simpleavg(C,smaLen1).
sma2 is simpleavg(C,smaLen2).
sma3 is simpleavg(C,smaLen3).

!LINEAR WEIGHTED 
LWMA is (C*20+C1*19+C2*18+C3*17+C4*16
      +C5*15+C6*14+C7*13+C8*12+C9*11
      +C10*10+C11*9+C12*8+C13*7+C14*6
      +C15*5+C16*4+C17*3+C18*2+C19*1)/210.

!ESA BANDS:
esa is expavg(C,esaLen).
upperESA is esa*(1+esaBandPct/100).
lowerESA is esa*(1-esaBandPct/100).

!BOLLINGER BANDS:
!SET PARAMETERS FOR BANDS:
 BBlen 	is 20.!Default is 20
 Mult1 	is 2. !Default is 2
 Mult2 	is 2. !Default is 2

Variance is Variance([close],BBlen).
StdDev is Sqrt(Variance).
SMA is simpleavg([close],BBlen).
UpperBB is SMA + StdDev *  Mult1.
LowerBB is SMA - StdDev *  Mult2.

ShowValues if 1.

Squeeze if upperESA > UpperBB and lowerESA < LowerBB.

SqIndicator is iff(Squeeze,1,iff(not Squeeze,0,-1)).

Buy if upperESA < UpperBB  and valrule(Squeeze,1)
	 and C > sma3 and C<LWMA. 
Sell if (PD>=3 and  LWMA < valresult(LWMA,1)) or C < PEP.

The EDS file contains the code for the various moving averages mentioned in the article as well as code for the Bollinger Bands and exponential bands. I did not code the SVE bands discussed by Vervoort in his article. I coded a system that uses the concept of a squeeze, as discussed in the article.

A squeeze occurs when the Bollinger Bands are inside the exponential bands. Figure 8 shows a sample trade from the system on NVDA.

Figure 9 shows the EDS summary report for a four-year backtest using the NASDAQ 100 list of stocks.

Sample Chart

FIGURE 8: AIQ. This shows a sample trade from the squeeze system.

Sample Chart

All Eyes on Energy

The energy sector – not just unloved, but pretty much reviled not that long ago – is suddenly everybody’s favorite sector.  And why not, what with crude oil rallying steadily in the last year and pulling pretty much everything energy related higher with it?

Anecdotally, everything I read seems to be on board with a continuation of the energy rally. And that may well prove to be the case. But at least for the moment I am waiting for some confirmation.

Two Concerns

The first – which I mentioned in this article – is the fact that the best time of year for energy is the February into early May period.  See Figure 1.

0

Figure 1 – Ticker XLE Seasonality (www.Sentimentrader.com)

With that period just about past it is possible that the energy sector may at least pause for a while.

The second concern is that a lot of “things” in the energy sector are presently “bumping their head” against resistance.  Here is the point:

*This does not preclude a breakout and further run to higher ground.

*But until the breakout is confirmed a little bit of caution is in order.

I created an index comprised of a variety of energy related ETFs. As you can see in Figures 2 through 4 that index recently was turned away at a significant resistance level.

Figure 3 shows the same information on a weekly chart.

2a

Figure 3  – Jay’s Energy ETF Index – Weekly (Courtesy AIQ TradingExpert)

Figure 4 zooms in to view the action on a daily basis.

3

Figure 4  – Jay’s Energy ETF Index – Daily (Courtesy AIQ TradingExpert)

As you can see in Figure 4, the index made an effort to break out above the January high then reversed and closed lower before declining a little bit more the next day.

The action displayed in the charts above may prove to be nothing more that “the pause that refreshes.” If price breaks out to the upside another bull leg may well ensue.  But note also in Figure 5 that ticker XLE – the broad-based SPDR Energy ETF – demonstrated the same type of hesitation as the ETF Index in the previous charts.

It too faces it’s own significant resistance levels as seen in Figure 5.

5

Figure 5 – Ticker XLE faces resistance  (Courtesy AIQ TradingExpert)

Summary

Energies have showed great relative strength of late even in the context of a choppy stock market overall.   So there is no reason to believe that the rally can’t continue. But two things to watch for:

1. If energy related assets clear their recent resistance levels a powerful new upleg may ensue.

2. Until those resistance levels are pierced, a bit of caution is in order.  Energy has been the leading sector of late.  Any time the leading sector runs into trouble it pays to “keep an eye out” for trouble in the broader market.

No predictions one way or the other – just some encouragement to pay close attention at a potentially critical juncture.

Jay Kaeppel

Disclaimer:  The data presented herein were obtained from various third-party sources.  While I believe the data to be reliable, no representation is made as to, and no responsibility, warranty or liability is accepted for the accuracy or completeness of such information.  The information, opinions and ideas expressed herein are for informational and educational purposes only and do not constitute and should not be construed as investment advice, an advertisement or offering of investment advisory services, or an offer to sell or a solicitation to buy any security.

One of the things …….. is that the U.K. is not in great financial shape right now – comments June 21, 2016

The Dow shot up over 270 points at the open, then spent the rest of the day giving back about half of those points to close up 130 at 17,805.  Volume was moderate, coming in at 96 percent of its 10-day average.  There were 178 new highs and only 9 new lows.

Yesterday’s rally was the Big Move predicted by last Thursday’s small change in the A-D oscillator.  It also came on the heels of last Wednesday’s VIX Buy Signal.
The rally was fueled by two polls released in the U.K. over the weekend that showed the ‘Stay’ vote taking a small lead. Prior polls had been showing the ‘Leave’ vote with a small lead, so the markets took the change in polling as a positive sign.  I wouldn’t get too excited about the polls, because the result of Thursday’s vote is still way too close to call, especially in view of the impact that a ‘Leave’ vote could have on financial markets.
One of the things that students should realize is that the U.K. is not in great financial shape right now.  The country is running significant account deficits and a lower pound won’t be that much help to British consumers and exporters.
In September 1992, when the UK last devalued its currency by 15 percent, the country was able to recover because interest rates had been running over 10 percent, so consumers and businesses benefited by the devalued pound which lowered interest rates.  But now with interest rates running near zero, a 10-15+ percent devaluation of the pound could have entirely different consequences.  It could severely impact the UK’s economy and put the country into a deep recession that could take years to recover.
So we need to be on our toes going into Thursday’s vote.  If the ‘Leave’ voters win, Friday could be a very bad day for world markets.  On the other hand, IF the ‘Stay’ voters get the upper hand, world markets should react positively with the Dow likely to re-test the 20 April high of 18,168.
Please be careful going into Thursday.  In my opinion, the vote on Brexit is too close to call and could go either way.  This means that the risk to your portfolio is very high.
So because of the high risk, I am mostly focused on short-term scalps.  With a positive Dean’s List, a neutral Tide, and negative DMIs and Money Flow indicators, the cockpit indicators are about as mixed as they can be.  They’re telling me to be on the sidelines or scalp trade only.

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However, my custom VTI turned positive after yesterday’s trading, so I’m going to look for scalp trades to the long side today.  One of the things I’ve found is that whenever the VTI changes direction, stocks highlighted for the Honor Roll tend to do well over the short term.  We’ll see if this holds true today with BP and Continental Resources (CLR), the two energy stocks that were highlighted last night.
My other focus will be on gold.  Yesterday’s early rally in the equity markets caused most gold stocks to pull back.  It also caused UUP to drop off the Dean’s List and the UDN, inverse Dollar ETF, to re-appear. So for the very short term, the Dean is telling is us the Dollar is weakening, which means the environment for gold could be getting stronger.
Also, the 2-period RSI Wilder on ABX closed with an oversold reading of 22.17. So with ABX in an Uptrend (50>200) and an oversold RSI on the Daily chart, its telling me that it might be a good time to go hunting. I spent several hours last night polishing my Rifle)
That’s what I’m doing,
The Professor
Market Signals for
06-21-2016
DMI (DIA) NEG
DMI (QQQ) NEG
COACH (DIA) NEG
COACH (QQQ) NEG
A/D OSC
DEANs LIST POS
THE TIDE NEU
SUM IND NEG

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AIQ monthly FREE scan – get yours now

For years the fundamental module in TradingExpert Pro has provided
a unique trading strategy tool for filtering stocks. These include
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·        
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·        
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stand fundamentally  
Each month we’ll be providing one or two insightful scans for FREE with
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March 2016 screen identifies stocks with EPS momentum.
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Under Valued High Yielding Stocks, best used when there has been a market
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Stocks with a Price to Sales ratio below the median for its Industry show
greater returns.
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at 
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The most popular use of the fundamental data is in
combination with technical strategies in the Expert Design Studio. What better
way to hone in on candidates than to combine both approaches in one strategy
that you can run every night.
Now with the launch of the AIQ Data Power Pack FATI®, you can get updated fundamentals each
month directly into your TradingExpert Pro again. 
Over 4400 Charts with instant click to 60 fundamentals fields

Unleash the power of fundamental
ranking with any number of strategies
Suppose
I want a list of stocks to short that are fundamentally weak what would I look
for?
How about a
High Risk, High Debt strategy?
This
strategy finds stocks that are having a hard time meeting their day-to-day
obligations. It finds stocks with the lowest quick and current ratio. The
lower, the more debt and liabilities and the less able a company is to pay
current debt. Add in a high debt to equity ratio and rank them all equally.
You’ll have a list of stocks that are worth keeping an eye on for a technical
entry to the short side. 
Here’s
Charter Communications, the top high risk high debt ticker on 2/18/16
Build a technical and fundamental strategy in Expert Design
Studio and run it every night
EDS
allows you to design, test, and automate virtually any trading idea with the
point-and-click interactive trading library and pre-built strategies that have
been fine-tuned by our analysts to produce outstanding results. 
With the FATI® fundamentals fields, you can add in another layer of screening
to your technical screening and uncover hidden gems in your database.

Included
with your fundamentals FATI® Sector and Group Structure and Extra bonus
FATI® Market Capitalization

AIQ announces the return of fundamental screening to TradingExpert Pro

Dear Trader,
For years the
fundamental module in TradingExpert Pro has provided a unique trading
strategy tool for filtering stocks. These include
·        
Advanced weighting
the impact of different fundamentals
·        
Quick build of
reports and lists
·        
Chart list
from fundamental reports
·        
Rank and
tag tickers so you’ll always know where they stand
fundamentally  
The most popular
use of the fundamental data is in combination with technical strategies
in the Expert Design Studio. What better way to hone in on candidates
than to combine both approaches in one strategy that you can run every
night.
Now with the
launch of the AIQ Data Power Pack FATI®,
you can get updated fundamentals each month directly into your
TradingExpert Pro again. 
Over 4400 Charts with
instant click to
60 fundamentals fields
Image
Here’s the
entire list of fields available on 4400 stocks, updated each month and available in
AIQ Charts, Fundamentals and Expert Design Studio. 
·        
Options
·        
Shares Outstanding (mil)
·        
Sales ($mil)
·        
% Held by Institutions
·        
% Held by Insiders Net
·        
% Chg Holdings 12 Wks Market Cap ($mil)
·        
Current Ratio
·        
Avg Daily Vol 20 days
·        
Beta
·        
Avg Broker Rating
·        
No. in Rating
·        
% Change Completed Qtr Est – 4 wks
·        
% Change Curr Qtr Est – 4 wks
·        
% Change Next Qtr Est – 4 wks
·        
% Change Curr Fiscal Yr Est – 4 wks
·        
% Change Next Fiscal Yr Est – 4 wks
·        
Est EPS Growth Current Year
·        
Est EPS Growth Curr & Next Yr
·        
Qtr EPS this Qtr/ prior qtr
·        
Qtr EPS last Qtr/ prior qtr
·        
Qtr EPS 2Qtrs ago/ prior qtr
·        
Anl Sales this Yr/ Sales last Yr
·        
2 Years Ahead Sales Growth
·        
Cash Flow 5 Yr Avg
·        
Div Yield
·        
Indicated Anl Div
·        
Payout Ratio
·        
P/E using Curr FY Est
·        
P/E using Next FY Est
·        
Return on Equity
·        
Return on Assets
·        
Return on Investment
·        
Inventory Turnover
·        
Receivables Turnover
·        
Asset Utilization
·        
Debt/ Tot Cap
·        
Debt/Equity Current Ratio
·        
Market Capitalization
·        
Quick Ratio
·        
Cash Ratio
·        
Interest Coverage
·        
Cash Flow ($/sh)
·        
Price/ Book
·        
EV/EBITDA 12 Mo
·        
P/E F1/ LT EPS Gr
·        
Pretax Mgn 12 Mo
·        
Net Mgn 12 Mo
·        
Oper Mgn 12 Mo
·        
Current Fiscal Yr Cons Est
·        
# Anlst in Cons Current Fiscal Yr
·        
Next Fiscal Yr Cons Est
·        
# Anlst in Cons Next Fiscal Yr
·        
Completed Quarter Cons Est
·        
# Anlst in Cons Completed Qtr
·        
Current Quarter Cons Est
·        
# Anlst in Cons Current Qtr
·        
Next Quarter Cons Est
·        
# Anlst in Cons Next Qtr
·        
12 Mo EPS before NRI
·        
Piotroski Score
Unleash the power of
fundamental
ranking with any
number of strategies
Suppose I want a
list of stocks to short that are fundamentally weak what would I look
for?
How about a High Risk, High Debt
strategy?
This strategy
finds stocks that having  hard time meeting their day-to-day
obligations.It finds stocks with the lowest quick and current ratio.
The lower, the more debt and liabilities and the less able a company is
to pay current debt. Add in a high debt to equity ratio and rank them
all equally. You’ll have a list of stocks that are worth keeping an eye
on for a technical entry to the short side. 
Here’s Charter
Communications, the top high risk high debt ticker on 2/18/16
Image
Build
a technical and fundamental strategy in Expert Design Studio
and run it every night
EDS allows you
to design, test, and automate virtually any trading idea with the
point-and-click interactive trading library and pre-built strategies
that have been fine-tuned by our analysts to produce outstanding
results. 

With the FATI® fundamentals fields, you can add in another layer of
screening to your technical screening and uncover hidden gems in your
database.
Image
Included
with your fundamentals
FATI® Sector and Group
Structure
Quality and Opportunity is right here. Stocks fitting the
fundamental criteria below are arranged into the FATI® Sector and Group
Structure and provided to you updated each month.

These lists contain stocks which have the following four key
characteristics.

  • Average
    Daily Trading Volume > 84,999 shares
  • Current
    Price > $4.99
  • Number
    of Analysts Ratings >= 2
  • Market
    Valuation > $99 million
FATI® Sector and
Group Structure
 – There
are approximately 2500-3000 stocks on average. They are broken down
into 17 sectors and over 60 industry groups. 
Extra bonus
FATI® Market
Capitalization
The same list of
stocks as in the FATI® Sector & Group list broken down by market
capitalization into separate lists.  Make your analysis
segment focused with ease.
  • Mega Cap > $50bn
  • Large Cap > $10bn < $50bn
  • Mid Cap > $2bn < $10bn
  • Small > $1bn < $2bn
  • Micro > $500mn < $1bn
  • Nano >$99mn < $500mn
Image

Updated tickers, lists and fundamental data every
month for one price

$29.99/mo.

Image
or call Sales: (800) 332-2999    1
775-832-2798 from outside the U.S.