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Posts tagged ‘Moving average’

Bank of America

Bank of America (BAC) — This is the second largest U.S.-based financial holding company with global assets of more than $2.1 trillion. Year-end reviews by Wall Street analysts resulted in upgrades. Reported earnings for 2011 were just $0.01. In 2012, the company earned $0.25. The newly revised consensus for 2013 is $0.91 and $1.36 for 2014.

On May 15, I wrote, “Technically, BAC broke from a 10-month cup-and-handle formation in early December, a clear sign of the beginning of a major move higher… The breakout confirms that BAC is still a strong buy. The immediate trading target is $15, but long-term investors could reap a much higher return.”

On July 23, the stock hit my trading target with a high of $15.03. Since then, profit-taking has taken a small bite out of these gains, and the stock has been stabilizing at its 50-day moving average.

The bull channel is powerful, momentum is strong, and MACD just issued a buy signal. Buy BAC at its 50-day moving average with a trading target of $20. As before, long-term investors could reap a much higher reward by holding this stock as a cornerstone investment.

source:http://investorplace.com/2013/09/trade-of-the-day-bank-of-america-bac/

Comment:

By Thomas
I am Long on this stock and concur with this Price target withen the next 12 months

Ist going to be a good one !

Market update OCT 2011

By: Chris_Ciovacco

As we mentioned yesterday, a fear-induced buying climax may occur in the
coming days as shorts cover and managers sitting on cash move to the “I can’t
take it anymore” stage. While a sustained break above the 1,266 to 1,276 range
on the S&P 500 would increase the odds of stocks continuing to march
higher, evidence still suggests the current move is a bear market rally that
will be fully retraced .The S&P 500 faces resistance from its 100-day and
200-day moving averages. As shown below in the chart from the 2000-2002 bear
market, these levels often bring out sellers. The first bear rally attempt in
2001 was turned back by the 100-day moving average (shown in blue). In 2011,
the 100-day current sits at 1,234.

source:http://www.marketoracle.co.uk/Article31079.html

Comment:

While Chris analyzes is in broad terms what I am expecting I am never the less preparing my-self to be wrong! By this I mean I am hedged I am only trading the one stock and have been doing so now for the last year I believe that the market is probably going to test its recent lows again. My Stock is currently moving between the 10DMA and tits 20DMA and is making ready to break out up to the 100MDA.Whilst I have been accumulating the stock as it has gone down I have been buying more stock from the profit of the put insurance .(The first purchases was at 11.35 per stock and the current average is now 7.31 to stock)

This has in turn brought down the average cost of the overall stock cost to me!I have been only using small amounts up to 2000 USD per trade  and have a total of 20,000 USD invested funds so far and in spite of the capital investment on the stock I have in fact
been collecting small profits from the movement of the options  on either side as I slowly tie a noose around the stock and at some stage will be profitable no matter which way the stock goes .My overall object is to pay off my home mortgage sometime next year with this investment. If you are interested  and are in the Dublin/Wicklow area, I am
available to show how this can be done to serious investors !

Next month I hope to start a trade with Machholz feature and you can follow my progress!

US Market movement update 2nd April

US Market movement update 2nd April

Yesterday I said judging be these charts I would expect the market to continue to head higher the DJ 30 is making new highs and the DJ20 transports are doing the same so we have a buy signal  The stocks I am following are BAC and C and with the BAC we have a crossover of the 200 DMA . If the stock closes over this moving average I would be a buyer .Citi has been hovering around the 4.40’s for a while and I believe we will see a new trading range soon between$ 5-and $6

  

The Dow did not close on a new high so we are on hold there as regards a new buy signal

  

But the Transports did so we need to wait for the Dow to do the same to get a confirmed buy single .Bank of America did not perform well and it failed to maintain its position above the 200 DMA on an up market day I would be cautious for the moment as it could break below the support at around $13.30. But long term I am a buyer, we should see 15.50 soon enough!

  

Citi did better managing to step above the 14 DMA and should continue to climb higher

 

 Charts are from www.freestockcharts.com  a truly great  free resource for the novice and professional traders out there .

US Markets

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Judging be these charts I would expect the market to continue to head higher the DJ 30 is making new highs and the DJ20 transports are doing the same so we have a buy signal  

The stocks I am following are BAC and C and with the BAC we have a crossover of the 200 DMA . If the stock closes over this moving average I would be a buyer .C has been hovering around the 4.40’s for a while and I believe we will see a new trading range soon between$ 5-and $6

These are personal opinions and are not meant to be calls to invest in these stocks or the market in general.

charts from  www.stocksharts.com

Bank of America Corp share price

NEW YORK (MarketWatch) — Just because some high-profile investors have sold Bank of America Corp. shares recently doesn’t mean the average investor should follow. The charts suggest the stock might have some short-term lift.

The fund run by famed billionaire investor John Paulson disclosed it reduced its B. of A. /quotes/comstock/13*!bac/quotes/nls/bac (BAC 14.81, -0.03, -0.20%)  holdings by 10% during the fourth quarter, while Warren Buffett’s Berkshire Hathaway /quotes/comstock/13*!brk.a/quotes/nls/brk.a (BRK.A 127,440, +165.00, +0.13%)   /quotes/comstock/13*!brk.b/quotes/nls/brk.b (BRK.B 84.93, -0.03, -0.04%)  sold its entire stake.

Before investors blindly follow their Wall Street heroes, keep in mind the sales were completed as of Dec. 31, when the stock closed at $13.34. It soared 6.4% the very next session, and the low so far this year has been $13.40.

In addition, the stock’s technicals are behaving like they did just prior to some significant upward spikes over the past couple of years.

The moving average convergence-divergence indicator, known as the MACD, is a trend-following momentum indicator that oscillates around zero. It is constructed using two exponential moving averages — the MACD line and the MACD signal line.

The indicator produced a “buy” signal over the last week when the MACD line crossed over the MACD signal line. More importantly, this crossover occurred with both lines north of zero.

Similar positive crossovers occurred on March 24, 2010, Oct. 9, 2009, and on the 15th and 28th of July 2009. After those crossovers, B. of A. spiked as much as 13% in less than three weeks, 9.1% in a week and 30% in less than two weeks, respectively.

B. of A.’s technical makeup looks a lot more like it did in July 2009 because of the recent appearance of a “golden cross,” which is when the 50-day simple moving average crosses above the 200-day simple moving average. The last “golden cross” appeared just before the July 2009 MACD crossovers.

Some investors may be skeptical of a potential technical breakout because short interest dropped 31% in just two weeks to 79 million shares as of Jan. 31 settlement, meaning a lot of short-cover buying has already taken place. But current short-interest levels are similar to those seen at the time of the previous positive MACD crossovers, and are still more than double the lowest levels seen during the bull-market years of 2005 and 2006.

The stock was up 0.2% at $14.87 in afternoon trading Thursday, off an intraday low of $14.73. A potential MACD crossover spike would likely propel the stock through key resistance at the $15.30 to $15.40 level, which includes the January high and the 50% retracement level of the decline from the April 2010 high to the November 2010 low.

Other upside levels to watch include the June high of $16.10 and the gap in the charts between the May 14 high of $16.72 and the May 13 low of $16.85.

So instead of Buffett or Paulson, perhaps short-term investors should follow Appaloosa Management’s David Tepper. He made billions buying bank stocks in 2009, called the stock market’s rally since last September, and raised his stake in B. of A. by 12% during the fourth quarter.

Comment:

I bought BAC at $10.93 and expect the stock to continue  up to about $17.50 (current price is $ 14.81) I am also in Citi and i expect it to go to 6.50 in the coming months

Dow looks strong and should continue to climb the wall of worry ,we could see it reach 13500 -14000 and possible see ne all time highs before we see acorrection of 10%-15%

T

Broad Market Reversal

New York Stock Exchange on Wall Street in New ...

Image via Wikipedia

Broad Market Reversal

 by Chris Vermeulen

Better hold on to your hat!

This had been an exiting week for traders as the equities market was on a verge of a major sell off. Fortunately, we were watching the market very closely and saw the sentiment and market internals shift shortly after a new low was set last week. That was an early warning for us that a trend reversal to the upside could happen at any hour or day this week.

Wednesday and Thursday’s rallies were on solid volume and the market internal indicators along with market breadth were strong also. There has been a large surge of new highs across the board on the NYSE, NASDAQ and AMEX. These numbers tell me that it’s not just one sector moving the market; instead it’s a broad market advance (institutional buying).

While I don’t typically try to pick major tops or bottoms because of the added risks and lower probability of winning trades, I do tend to spot them forming a few days in advance allowing me to tighten stops and take some profits on positions.

Trend reversals typically have large violent moves near the beginning and end of their life cycle making things not only tougher to trade but potentially more costly. Once I see a trend confirmed with moving averages, volume, and sentiment along with market breadth that’s when I start looking to take positions on pauses or pullbacks to support zones. This greatly increases the odds of winning/making money from the market. There are some really great Options Trading Strategies for taking advantage of these volatility changes in the market which you can get at OptionsTradingSignals.com

SPY Daily Chart:

 

 As you can see the market has clearly broken to the upside above key moving averages after finding support at the 50 day moving average. This rally has some solid volume behind it which I like to see also.

The first 3-4 days of a trend reversal generally post some give moves but after that initial thrust expect a pause or pullback to happen.

SPY ETF Trading

SPY 60 Minute Intraday Chart:

 We were lucky enough to take profits on our inverse SP500 trade as the market started to give us mixed signals of a possible rally. A couple days later on Nov 26th we saw a major shift within the market sentiment preventing us from shorting the market again.

Two days later the broad market gapped higher triggering protective stops/short covering sparking a fierce two day rally which took the market up to a major resistance level. I do feel as though the market is going higher, but right now, everything is WAY over bought and trading at resistance. Even if the market moves higher for another 2-3 days and breaks this resistance level, it will most likely have a pause, or pullback as it regains energy for another thrust higher.

Trade SPY ETF

Mid-Week Trading Conclusion:

 In short, it looks as though the trend is now up and the Christmas rally could be gearing up for a good one!

source https://machholz.wordpress.com/wp-admin/post-new.php

Comment

Way ahead of you chris with this one

Random Market Observations

Submitted by
Sy Harding

Financial pundits are explaining the market’s recent gyrations as reactions to daily news and economic reports. Tuesday’s big decline was supposedly due to uncertainties created by the Irish debt crisis, North Korea’s shelling of a South Korean island, and the 2.2% decline in existing home sales, while the market ignored the positive upward revision of third quarter GDP.

Wednesday’s big rally was then supposedly due to the decline in unemployment claims, and that incomes rose 0.5% last month, slightly better than the 0.4% economists expected. In responding positively to those relatively minor reports, the market rally supposedly ignored the big plunge in Durable Goods Orders in October (the largest monthly decline since January, 2009), that new home sales fell 8.1% in October, worse than forecasts, while home prices declined further, and the inventory of unsold homes rose more than expected.

It’s much more likely that the market’s gyrations are technical in nature, caused by traders watching and reacting to the market’s struggle with short-term support and resistance levels.

After initially spiking up in reaction to the Fed’s QE2 decision, the market topped out at least temporarily two weeks ago. The Dow subsequently broke below the previous support at its 21-day moving average for the first time since the big rally began in early September. That no doubt got the attention of traders.

The Dow then rallied back up to its 21-day m.a. last week, where the question was whether it would break back above the m.a., and re-establish the m.a. as support for a resumption of the rally, or would find the m.a. to now be overhead resistance with the correction likely to continue.

The question remains unanswered. In Tuesday’s triple-digit decline the Dow clearly found the m.a. to be overhead resistance.

112410a

However, the Dow’s plunge Tuesday halted at the potential support at 11,000, as did its triple-digit decline a few days ago. So a lower high was created by the resistance at the moving average, but not a lower low on the pullback.

And on Wednesday it rallied off that potential support back up almost to its 21-day m.a. again. So the jury is still out on the market’s short-term prospects.

Meanwhile, global markets are just as interesting. I don’t have space to show individual markets, some of which are looking positive, some negative. But the next chart shows that global markets as a whole topped out with the U.S. market a couple of weeks ago (leaving a potential double-top in place). And after finding their 21-day moving averages to be overhead resistance, declined to a lower low last night and yesterday. That has the chart in a potential negative pattern of lower highs on rally attempts, and lower lows on the pullbacks from those rallies.

112410c

Of course it’s the longer-term outlook that is of more importance. But the current short-term situation is certainly interesting, and its outcome may be important to that longer-term outlook.

source https://machholz.wordpress.com/wp-admin/post-new.php

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