Archive for the ‘Chart of the Day’ Category

They Love ‘Em Higher

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Complacency/Bullishness is at extreme levels, but does it matter?  Not yet, but it will, eventually.  We continue to expect a volatile year ahead which will produce many an opportunity.  

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Yields Continue To Rise

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The TNX(10 Yr. Treasury Yield Index)will close above the 2016/2017 highs today.  At 2.63% the 10’s are at their highest yield since the summer of 2016.  Fixed income investors are expecting stronger economic growth this year. 

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Kraft Heinz Setting Up Well For More Upside

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KHC is on the verge of a breakout.  The stock is lifting nicely this week after hitting new January lows on Friday.  Shares are up 2% today and are beginning to pierce a key overhead trend-line that links the July/December highs.  The bottom near the October/November lows is now looking significant.  A powerful rally leg off this area could carry KHC much higher.  Option players are also quite positive.  Here’s a closer look from Bob von Halle:

Active day in upside calls in KHC. With the stock at $80.40  mid morning, a single buyer paid $1.50 for approx. 3,000 April 82.5 calls. That was followed closely by another purchase of 4,500 at $1.80 with the stock around the same level. Over 9,000 contracts in total have traded on the day. Also, a bit over 2,000 of the Feb 82.5 calls have traded with half of them purchased in one trade at $.95. Once we get past the Jan expiration cycle this Friday, the April call activity will create the largest block of open interest in KHC as of this writing. 

Also of note, KHC sports a fairy high short interest ratio(4.9).

Earnings due February 14th.

At time of publication we have no positions in KHC.

MCD

MCD

A Major Bottom In Nabors Industries?

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Nabors Industries(NBR)had a very rough 2017.  At the mid December lows the stock had dropped 70% from the January peak.  Over the last four weeks, as the energy sector has been in rebound mode, NBR has perked up nicely.  Major support near the $5.00 area, which held the 1999 and 2016 all-time lows, allowed shares to regain their footing at the October/November/December bottom.  At today’s early high NBR had rallied over 50% from the 2017 fourth quarter lows leaving behind layers of support in the process.  We believe more upside is ahead as the stock begins to pierce its declining 200 day moving average.  A close back below $7.00 would violate last week’s low sending a clear warning sign in the process.

Bob von Halle provides NBR option highlights:  Jan, Feb and March open interest on the $8 strike is significant (well over 15,000 contracts in each one) and dwarfs pretty much anything on the put side in terms of open interest. Appears option players have been positioning for upside over the past few weeks. Full disclosure I have been long NBR stock in all my accounts for several months.

XOM

XOM

That Was Fast

The Dow Jones Industrial Average begins the week above 26,000 after the fastest 1000 point gain in history:

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Steady.  Higher.  Relentless.

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– chart compliments of ZeroHedge.

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