Review of the Best Classical Chart Pattern Breakouts

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Every week, as I go through 1000’s of charts. I look for select, common characteristics on developing chart patterns. And the chart pattern should be mature on a weekly scale. For me, this means chart patterns in duration between 3 to 24 months. It should have a well-defined and preferably a horizontal chart pattern boundary. I look for chart patterns classified as H&S top/bottom, rectangles, cup & handle continuations, double top/bottoms and flags. I only feature symmetrical triangles that have well-defined boundaries. The boundary of the chart pattern should be tested several times before the breakout takes place. Several tests of a chart pattern boundary is an indication that market participants actually recognized the pattern boundary as an important technical level. A breach of this level would signal a shift in the market dynamics between the bulls and the bears.

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Tech Charts Service – Webinar Recording

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Please watch this interview between Aksel Kibar and Peter Brandt discussing the Tech Charts Service.  Your opportunity to join as a Founding Member (at discounted for life) expires on June 1st.

Aksel goes into detail about what you could expect as a Founding Member (Sign up links below video), service includes:

  • Yearly membership  –   Substantially discounted for as long as you keep renewing
  • Global Equities Report  – Delivered weekly
  • Classical charting principles  – Learn patterns and setups
  • Actionable information  – Worldwide indices and stocks of interest
  • Risk management advice  – The important trading points of each chart.
  • Information on breakout opportunities  – Identify the ones you want to take action on
  • Video tutorials  – How patterns form and why they succeed or fail
  • Watch list alerts  – As they become available so you can act quickly
  • Breakout alerts  – Usually once a week
  • Multi-part webinar course  – You learn the 8 most common charting principles
  • Webinars  – Actionable and timely advice on breaking out chart patterns

Webinar Recording

 

Hurry before it ends.  Obtain Founding Member status and receive a discounted price for LIFE!

Sign up here:  https://blog.techcharts.net

 

Tech Charts Service – Founding Membership

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Dear followers of the Tech Charts blog,

Today I am pleased and proud to announce that we have launched our long awaited, Tech Charts membership service.  And because of your loyal following to date, we’re offering you the opportunity to join the service as a special Founding Member.

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Video Tutorial – Long Term Charts

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Our Founding Membership launch is now OPEN!

For a 10-day period only, take advantage of our very low Founding Membership rate (locked for life) and join me on this new chapter.  See https://blog.techcharts.net for more details.

 

   

Long Term Charts - Video Tutorial

 

Richard W. Schabacker discussed the importance of chart patterns in the averages, in his book Technical Analysis and Stock Market Profits. He concluded that if many individual issues were to make strong Head and Shoulders formations at exactly the same time, the average chart would, obviously, show a similar Head and Shoulders. However, since the many different stocks do not, as a rule, make their ‘‘peaks and valleys’’ on precisely the same days, the average chart is likely to show a less specialized and distinct pattern. We should, for this reason, expect the averages to show Common or Rounding Turns more often than do the charts of individual issues at times of important reversals.

Most stocks sooner or later will follow the major swings of the market. Individual stocks in a sector or industry group might form similar chart patterns due to economic cycles or sector rotation. These individual stocks can be affected by other factors such as commodity prices.

One should stay alert and start anticipating a major shift in the direction of the trend after finding similar chart patterns developing in a specific sector or industry group. It is important to note that these chart patterns are usually well-defined on the individual stocks when compared with the chart patterns on the averages.

The video tutorial discusses what can be next for the European banks by giving examples from the two major trading themes in energy sector equities and mining companies. Read More

GLOBAL EQUITY MARKETS – May 13, 2017

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Reminder:  Just one week left until our Founding Member launch on May 22nd!

 

It has been a strong week for equities in emerging Asia and also a strong start for the month of May. South Korea KOSPI index is breaking out to all-time highs by clearing its 6 year-long horizontal resistance at 2,210 levels. The index possibly formed a multi-year long bullish ascending triangle. A strong monthly close will signal positive performance for the coming months. The ascending triangle chart pattern price target stands at 2,750 levels. Emerging Asia is a big component in the MSCI Emerging Markets index. As of May 11, 2017 the top 3 counties in the index are China (26.92%), S.Korea (15.34%) and Taiwan (12.20%).

While the local currency stock market index South Korea KOSPI is breaking out to all-time highs, the U.S. Dollar denominated MSCI S.KOREA price index is few percentage points away from reaching new all-time high levels. The price action is clearly positive. The 9 year-long downward sloping trend line is standing at 460 levels. MSCI S.KOREA index is trying to break out of its multi-year sideways consolidation range.

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GLOBAL EQUITY MARKETS – April 29, 2017

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The first round of the 2017 French presidential election was held on 23 April 2017. As no candidate won a majority, a run-off election between the top two candidates, Emmanuel Macron of En Marche! and Marine Le Pen of the National Front (FN), will be held on 7 May 2017. Global equity markets reacted positively after centrist candidate Emmanuel Macron won the first round of the weekend’s French presidential election. European equities have been performing poorly since the beginning of the global financial crash in 2008. Any positive political and economic development is likely to help European equities to catch up in the relative performance. Though, European equities might need more catalyst than an election result to reverse long-term relationships.

Two charts below show the massive under performance of the European equities vs. the U.S. equities over the past 9 years. Both the relative performance ratio between MSCI EUROPE vs. MSCI U.S. and EUROSTOXX 600 Index vs. S&P 500 Index shows a multi-year downtrend. This long-term relationship is something that we should keep a close eye on, as any major turnaround in European indices performance will result in more breakout opportunities in the European equities.

Relative performance ratio between the two indices is converted into an index to better visualize the change in value in percentage terms. 1.00 is an index value of 100. 0.42 is an index value of 42. The chart shows the index losing more than half of its value from the highest level in 2008. In other words MSCI EUROPE underperformed MSCI USA by 58% over the past 9 years. Data used for MSCI EUROPE and MSCI USA are price index in U.S. Dollar.

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A New Beginning – Tech Charts Service

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Dear Tech Charts followers,

The Tech Charts blog started back in 2011 as a platform to share ideas and connect with like-minded analysts and traders from around the world.  And writing publicly about the markets has kept me motivated, structured, and focused on my technical analysis and trading.

In recent years, more and more traders and investors have gained access to global equity markets through either ETFs or directly via their broker accounts. This expanded access has allowed me to multiply my search for classical charting opportunities in the global equity space.

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GLOBAL EQUITY MARKETS – April 22, 2017

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It was a mixed week for Global equity market performance due to each countries own political and geopolitical developments. However, the benchmark for Global equities, the MSCI ALL COUNTRY WORLD INDEX still shows a clear uptrend. MSCI ALL COUNTRIES WORLD INDEX captures large and mid cap representation across 23 Developed Markets and 23 Emerging Markets countries. With 2,481 constituents, the index covers approximately 85% of the global investable equity opportunity set. iShares has an MSCI ACWI ETF that seeks to track the MSCI ALL COUNTRIES WORLD INDEX. The ETF is listed on the Nasdaq Stock Exchange.

Since the beginning of 2016, MSCI ACWI ETF (ACWI.O) is in a clear uptrend. Over the past two months the price has been challenging the resistance at 63 levels. The continuation of the uptrend will depend on the strength around this resistance level.

iSHARES MSCI ACWI ETF (ACWI.O)

Last one month's price action can be identified as a possible pennant formation. Pennants are short-term continuation patterns that mark a small consolidation before the previous move resumes. Pennants, which are similar to flags in terms of structure, have converging trendlines during their consolidation period and they last from one to three weeks. Breakout above 63 levels can renew upside momentum both on daily and weekly scale. Strong support area remains between 62 and 62.5.

This week there are 3 new chart pattern breakout signals.

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U.S. BANKING STOCKS

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Up trends are still intact on the financial stocks in the U.S. A quick look at U.S. banking stocks can help us put things into perspective on the medium/long-term charts. This update reviews 6 different U.S. commercial banks. As you go through the charts of these commerical banking stocks you will find similar technical outlook as outlined below.

  1. In November 2016, following the U.S. election, all of these names had strong breakouts from lengthy consolidation periods.
  2. Most of the names have reached their chart pattern price targets.
  3. Since the beginning of 2016, all of the charts analyzed have formed consistent up trends as identified by parallel trend channels.
  4. Over the past 3 months, all of the names have pulled back to their 200-day averages.
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