Technically Speaking: Breakout & Reversal Patterns | John McNichol | 10-14-19
And, breakout. And reversal, patterns. Yeah. We, are good. And. Let's go ahead and take care of her disclosures, and we'll get right into it. Options. Are not suitable for all investors as, these special risks inherent options. Training makes those investors potentially, rapid, and substantial. Losses carefully. Read the provided. Copy of characteristics, and risk of standardized options, spread. Straddles, and other multi, leg, option. Strategies can entail substantial, transaction, costs defense, option strategies often involve, greater and more complex risk than, single leg option trades and. Investors. Should also consider, contacting a tax advisor regarding. To tax treatment applicable, to spreads and other multi leg option. Transactions. Now, in order demonstrate to function out of the platform we will be using actual, symbols, keep, it in mind TD Ameritrade does not make recommendations, or determine, suitability of, any security or strategy, for individual, traders any investment. Decision you make in your self-directed account, is solely. Your, responsibility, now. We have a demo account to, utilize. It looks like a real account but it's not you, have the ability to practice what you learn by utilizing, paper money which is for educational purposes and successful. Virtual trading during, one time period does not guarantee successful, investment of actual funds during, a later time period as market, conditions change continuously. As. Always. All investing. Involves, risk including, the. Risk, of loss let's. Go ahead and bring up our thinkorswim platform see, what we're going to get involved with, today, thanks, for being here active. Andy Catalina, dreamland. In Tim. Everyone. Should be hearing me loud and clear there, you. Can look on the left-hand. Margin. Inner. Scratch pad we. Have, the. Ability follow. Me on Twitter if, you'd like. @j. McNichol, underscore, TDA also. Our fellow instructors. And coaches typically, their first initial last name is, all you need to do to be able to follow us and also. If, you like these webcasts, that. Along. With this one that is the trader talks webcast make, sure you click on subscribe, on YouTube, so, that way and you can also turn on notifications so. You're informed. Of any upcoming session. And if you can't catch them live at least you'll know you can go back and check it out later, usually. Within a few hours there. Okay. Let's. See, here I'm going to go ahead and look. At her agenda we're gonna go ahead and review the sectors you know we're in the last quarter, of the year, so, probably, a good.
Opportunity To, take a look at, the sectors and see what patterns may be forming, and, apply. Some of the principles, of our moving, average crossovers, on how they can come into play on reversal, patterns and, we'll. See if anything setups and does. A practice. Trade by. The end. Of this session you, should be able to identify. Potential. Breakouts. And reversal. Patterns, within. Your, major sectors, and that can translate, into some, individual. Stocks that, can be a bit of a driver, on what. Types of breakout, trades you, may consider. Alright. Now. We'll. Start off with looking. At the broad, market. A, pretty big day coming. Up from last, week. Let's. See if we can go ahead and take a look at the big board, at. A few, technical issues earlier, we'll see if we can go ahead and make, this work. Looking. At the, sp500. After. Some. Of the stronger moves on Friday, even. Tweeted, about this in the case of the small caps we. Had a pretty, big move, where. Prices were trading. Higher, close, to that 3,000, mark on the S&P 500 and then, went ahead and backed, off of that where. Prices went ahead and after. Hitting a high basically. Faded. This, would be an example of what some traders, will refer to as a shooting. Star. Currently. When we look at today's price action as, we're beginning to head into another earning. Cease. As, well as just, overall. Market. News coming. Out during the week a little more of a consolidation. Today, what. Some traders would refer to as an, inside, day and inside, day being that the, current price action is. Inside. That. Previous. Day so, kind of a little bit of a consolidation. Notice. Gaps as well, can. Act as support and resistance. This. Was a breakout. Now. Gaps, are what I refer to as an. Overachieving. Breakout, you know instead of prices, just kind of poking above that resistance, or poking, below that support, you, may see kind. Of a bit of a surge that's, what occurred on Friday. And. With. Today, kind, of consolidating. Inside, that range let's. See if we can go ahead and look at some of the other indices. Such. As the Nasdaq. And. I'll try that one more time. And. Look at the Nasdaq we, can see a similar. Situation, as from. A diagonal. Standpoint. Just. Kind of connecting, the dots. Diagonal. Resistance, we, had the gap again, a little more of a, shooting. Star but, no follow-through, on, filling. The gap as of yet the market is trying to hold the, gap at the moment now. When. A breakout, occurs whether, is a gap or prices, trading above that resistance, you know there is a tendency that prices. May go ahead and drift down potentially. Fill in in that. Gap so, if I try and zoom in a little bit more here. We. Can see the space in between the candles, and from. That standpoint. If. Those levels don't hold looking. To see if prices are able, to go ahead so. If I got that right there. Possibly, fade, into. That and in that case that's where traders may be looking, for a bounce. So. That's what we got going on with some of those major market indices. Looking. At so we got the small caps on here or not. We.
Have To go and go to the big board here or my other screen and bring. That up. Bring. In our UT. Lot. Traders may look at the small caps as a you, know a bit of a lead. There we've, tweeted, about this as well, and. Kind. Of zoomed in the. Russell went, ahead and. Did. Break a diagonal. Resistance. Looking. At the highs. On. That. Friday price action and it. Traded. Up. To a 50%, retracement. Those of you that have followed me in the past we've, discussed, Fibonacci. Retracements. How they can act as support in resistance, on a downward. Move. Potentially. Acting as resistance we. Hit that intraday, and prices. Backed off of that and then as we look at it currently zoom, in in. We're. Seeing that inside. Day after. A big move, seeing, price. Action, consolidating. Inside. The range of that, previous day. All. Right now, let's go ahead and take a drill down on some, of the sector's. And. One. Could go ahead and bring up a public list I have. That over, on the. Right. Hand side. Digression, on yeah on the left-hand side I'm going to close up the scratchpad here, for, a moment and. One. Can bring up a public list of S&P. 500. Sectors. We. Have the kind, of the. All. Ten, of them there maybe just a little bit more there I'm, gonna go and click buy, percentage. So, we can get an idea of kind. Of what is leading, and what, may be falling. Back here today and. As. We go ahead and look at this as, far. As in positive, territory now, I can actually step over on this side of the screen being, like the weatherman, we. Can that, financials. Health care energy, are in, positive, territory, that. Certainly helps you know as far as the bullish case to see things like financials. Being, positive that, may be anticipating. As far as yields, had taken a spike on. On. Friday there now banks are closed today some of the futures still. May be trading, there there could still be some upward pressure on yields. Which. Would. Typically have a negative impact on real. Estate now, if we go ahead and take a look at a few of these see what types of patterns, may be forming. We'll, go ahead and click on healthcare first and, as. We go ahead and take a look at healthcare. We, can see some of the same characteristics, that we saw on the, broader, market. For. Example. That. Downward. Resistance. Price, gap, in out of that area, now. From, a larger, perspective traders. May be looking, at. Kind. Of major. Resistance. As well. As looking at support, and this has been typical. In, the market as well being a bit more range bound. However. In the context, of a larger. Pattern smaller. Patterns. May form, so, for this example some. Traders may refer to this as more of a triple. Bottom as we're, seeing multiple lows. Somewhat. Equal lows there. And. Then. Seeing, from, the resistance. That. Is where a potential, breakout, may occur now notice. As we have, that pattern there we. Have some, of our moving averages, on there that. Green moving average representing. An example. Of an intermediate, trend we're utilizing a. 55. Period moving average some traders may use a 50. Period now. As we look at the direction of that it has generally. Been sideways. To down, but. Over the shorter, term coming. Off of the lows, from. This last week as. Price. Has gone higher. Notice. That some. Of the faster, moving averages, are kind of converging. And as. Are converging, one may see a crossover, that crossover, can be one, of the first signs of a price, reversal. Now as far as the intermediate, trend. Traders. May be looking for prices, to get back above that, intermediate, moving average and seeing that continue, to rise so, this could be part of a sign of what, some traders may look for for that potential. Reversal. Pattern breakout, so. Possible. Short-term, crossover. Price. At resistance, looking, for the follow-through as price breaks, above. Let's. Go ahead and bring up. We'll. Go back and forth on this. So. That's what we're looking right, now in the financials, so some. Traders would speculate you know for the market to reclaim. Some. Of those new highs the. Financials, would need to participate and, so we're seeing an example of, you know from a shorter, term some. Of that occurring, now. Some traders kind of look even. Closer to that you'll, compare in some, of the lows, here, and we showed you a tool on how you can do that coming. Up to patterns. Coming. Up to patterns, on the, thinkorswim, chart, and select. Patterns, and. Once. We're selecting patterns this is part of the candlestick. Area. There so we'll click on candles, and. Down. At the bottom of the list. Coming. All the way down we. Have the williams fractal. Pattern, I'll go and I'll click on Williams fractal and select. Okay. Now. What you'll see or should see is some, price points, appear. It, looks like it didn't do it on that first run let's, try that one more time. Candlestick. Down. The list get, a little practice here. Williams. Fractal. We'll, click that Add selected. And, select. Okay didn't, like my double, click. Now. As we kind of zoom in on this now this is not a.
Perfect Indicator, but, it attempts, to look for some of the highs and lows into trend let. Me go ahead and bring up those financials, again seem, to want to switch symbols on us and we. Zoom in you can, see some of these caret, points that are on the chart and if. You go ahead and look at where, they, stand as an, example. Here's. A low. There's. A lower low and more. Recently, with this bounce there, is a higher, low now when someone sees something like that, that. Has more of the characteristics. Of an, inverse. Head & Shoulders this is one of the patterns that's discussed in the technical. Analysis, course and. With. That, resistance, being. The neckline which we've had a bit of a break now it doesn't look like a classic. Inverse. Head & Shoulders as symmetrical. As hopefully my body is, but. That is a transition. Of price, action going. Down, and possibly, reverse, and higher. For. A confirmation, of the reversal, of the trend is to, see if prices are making higher highs and, higher lows and, over, the shorter, term if you look at the fractal, points we. Have a low higher. Low. There's. A high now, the, most current price action may not show that but, there, is a higher, high so over, the last couple of weeks we're. Seeing the development of a shorter, term trend now whether that translate, in a full reversal of the, intermediate, trend we'll stay, tuned but even as we're speaking on the, financials. They. Are trading, up near the, highs of the day all. Right so that's what the financials do now let's take a look at the energy and see, what, they're showing. Actually. We'll just go down the list sorted. From top to bottom for today we, have, healthcare. And. Looking. At healthcare we, may see similar, patterns across. The board. Again. Kind of more of that flat and, CIN. Prices. Basically gapping. And holding, that previous, range. Traders. May go ahead and make that comparison, connect. Off of, the, highs now notice here I just, went ahead and connected off to some of these fractals, let me go ahead and zoom in a little bit more, on this, left. Click and drag over, that chart. And. See if it catches up with me there we go and. This. Is a little, more pronounced as far as that head and shoulders, bringing. Up our drawing tools here. There's. A fractal, point for a low there's, a lower low there's, a higher low a little more of that symmetrical. Inverse head and shoulders. Connecting. The dots on resistance, notice how that's following, along that moving average moving averages can act as support, and resistance, now. Not quite a crossover today but maybe setting, up for that that. Shorter term momentum may, translate, into that intermediate. Momentum, and looking. For a break at resistance, now, typically, if, that. Breakout occurs traders. Would measure the distance, between that, resistance, and support. To. Set a potential, price target, so, as far as the index itself looks. Like it's in about a. Let's. Say about a twenty, five point range. If. It was to break out around the. 10/40. Area you, know twenty-five would put it at around ten seventy five that would be attempting, to reclaim. Those. Previous, highs, now. Let me double check make sure we don't have any questions, here. Active. Andy says does the Russell sometimes usually lead on the way up or on the way down well that is some of the.
Some. Of the perceptions for some traders, on why, they may look at the Russell and kind. Of get that as a leader seeing, that it is about. 25%. Or. Correction. Since. It is about. 2000. Stocks across. The broad market. Unlike. You know 32 stocks, on the Dow or even 500 stocks, on the S&P 500, which is more large caps you, know the idea is that small. Caps have a tendency, of being more sensitive, to, some of the economic, changes that may occur such, as potential, recession, and so that's why some traders may look at the, rustle to, get a bit of a guideline. There so excellent, question there Andy thanks for that all. Right so that's. We got going, on with the health, care and so. Potential. Sign of rotation, there in health care has been an area that, has lagged, the market. For some time, over. The last 89, days some, of the script that I have on here. Over. The last 89, days it's. Pretty much flat and it's still down about one and a half percent. Over. The last month, we'll, see if that momentum, changes, one, thing that some traders may look for, that momentum, is, relative. Strength, looking. At which is part of the shared chart I given you that's. The bottom indicator here is looking. To see if that, relative, strength line, begins. To rise, compared. To the, market, right. Now looks, like it is just. Kind. Of more flat which is better than going down going flat with me more market. Perform. Looking. At let's, see looks like real estates ticked up a little bit here too now. As we look at real estate compared. To the previous, two sectors, which may be more setting up for, reversal. Patterns, to potentially, kind of pull more. Into a bullish category. The. REITs. Looking. At that REIT sector, real estate has, been more. Bullish. Overall, with the overall trend, of interest, rates now, if interest rates continue. To tick, up that. Could impact, but. As far as the current pattern this would be an example of more of a continuation. Of a. Trend why continuation. Because, we can see that. From. An intermediate standpoint. Price. Action is rising. And. Notice. In this case it's actually being supported by, the. 55 period moving average. Now. Notice over a shorter, term the, some. Of the faster moving averages are going flat, moving. Averages are going flat, for. An example some of these shorter term averages. You know 5 10, even 20 to 30 periods, there that, may be indicating, that there. Is more of a pattern being formed, and if. We go ahead and connect the dots off of, those highs and lows we, can see an. Example of declining resistance. As we've seen across the board but, rise. In support, form. In more of a triangle, so. This would not necessarily be, a reversal. Pattern this would be an example of the continuation, and. Traders. Looking for the break. Of that, resistance, and possibly. Trade on that upward momentum, likewise. The inverse of that if one was more inclined to be in bearish, they may look for a breakdown of the opposite, side, of the pattern which would be below, support represented. By in this example 55. Period moving average so, looking. At real. Estate kind, of being squeezed, as. Traders. May be looking at real. Estate prices which for instance new, home prices. I believe will be released on Wednesday, that, could be a driver, on which, direction this, pattern, may break okay. Energy. Looking. At energy. We. Get reports coming, out later in the week as far. As with oil. And gas production also. Rig counts, coming out later in the week, as, we look, relatively. A weaker, sector. As. We've. Seen how much it has gone down what. Are some signs for a reversal. Well, one we, can see that prices, basically had. Tested. A. Previous. Low and helped. Looking. At some of the more major highs. This. Would be a relatively, larger, pattern at, least over the course of the last two months but, some traders may look at this as potentially, being a W, pattern at least, have in room to trade up in that range. From. A shorter-term standpoint. From. A shorter-term standpoint. If. We kind of zoom in, on this. More recent price action. Again, looking at the highs and lows. We're. Seeing a low that. Did not work let's try that again. We're. Seeing a low, kind. Of more of an equal, low and. There. Is a more recent high as. Prices. Are breaking above that high so over the shorter term we're, starting to see higher. High higher low now. From an intermediate standpoint. Still expected, to be some resistance, there, an. Ultimate reversal. The trend may occur when prices, are getting, above some of those major averages and seeing. The shorter term moving averages, actually. Cross. Above. The, more intermediate, side, so. Coming, off the lows some. Traders may be looking for some shorter term breakouts, on. Energy. Stocks so think about that as we'll go ahead and look at our watch, list when we round, things up, looking.
At Information. Tech, looks, like it's been kind of bouncing back and forth there. Notice. On information, technician. Closer to the highs, we've, actually tweeted, about this if you go ahead and look at my handle on for instance the socks the semiconductor. Index had. Been forming more the characteristics, of a cup and handle, as, we look at tech as a whole we. Can see possibly. Some of those characteristics as well. Again. Connect in off of some, of the dots get. Our drawing tools working here. Looking. At some. Of those highs, an. Example of a cup. Followed. By a handle. A, bullish. Pattern, in. This case kind of a bullish, reversal to, continue the longer-term trend, traders. May go ahead and measure again the distance, between, that support, and resistance, to. Find, a potential, trade and. We may see some, of the chips, displaying. Some of those same characteristics. Now. Let's go ahead double check make sure there have any questions here looks. Like we're hanging in there. Sharon. Asked the question as far as moving averages. The. Examples, of the movement averages that we've. Been Sharon is a 55. Period moving average for. An intermediate, and a, 13. Period, moving average is the blue one kind of more of an intermediate kind of half the monthly cycle and red. Is a five period, representing. Kind of that weekly. Trend, or that weekly swing and. We. Can see there, was a recent shorter term crossover. Which. May point towards a continuation, of an, existent. Trend. Alright. Let's, go ahead and bring up let's, see in, the industrials, the. Industrials, have had some relatively, stronger moves over, the last few sessions, as. We take a look. Prices, went ahead and, traded. Above kind. Of their intermediate average. Even though that average has been a little, more on the flatter side but, look at some of the same characteristics, that. We had with, technology. Kind, of more of those equal highs you. Know we had a sell-off the. Last sell-off, is a little. Bit on the higher side and. We've. Seen a pretty, good, break higher this, is something similar that one may see on energy, energy. Had the similar pattern, where it kind of was making, almost, a smaller, double. Bottom and kind, of consolidating. At that resistance. Industrial. Stocks on Friday actually broke. And pushed higher. So. There may be some, signs of rotation, there, we'll see how some of the reports, come out during, the latter part of the week. Consumer. Services. Thinking, along like Netflix. They. Had been struggling a bit and kind. Of similar to what we were looking at the Nasdaq. If. You compare the highs, and the lows you, know over a shorter term you, know we're seeing that there. That inverse. Head-and-shoulders action. Low. Lower low higher low looking. At the resistance. We, kind of pushed above it intraday, and now we're just consolidating. That right inside, day, so what traders may be looking for is if today, continues, to be an inside day looking, for the price action to break above, the, high of that pattern, and. As. We go ahead and take a look at around, things out with a consumer. Staples. You. Know consumer staples, has been more of a, defensive. Play, when. We looked at the REIT pattern, the, real estate pattern very similar as well you know they're above their. Intermediate rent. Acting. As support. There. Is some overhead resistance kind, of more of that triangular. Pattern. Kind. Of a driver here, could be in the lines of growth if the, market gets in to be more of a risk on attitude. And. If yields. Push. Higher there. Could be some pressure on some. Of these staples to, push, lower kind of like utilities did, today which we'll show you in a, sec however. If the market gets more defensive, again. And. Equity. Is kind of generally roll over we may see some out performance, here so, you know patterns, and these consolidations. Are really, a matter of the market trying. To figure out its way now. You can look it from the top down and, recognize, hey there's.
Potential, Here whether, it breaks up or breaks. Down. Ok. Now let's go ahead and take a look at. Materials. And then we'll finish off with utilities. They're materials. Just like the industrials, had a bit of a pop going. Into, the end of the week. After. Selling, off pretty strongly there is still some, resistance. Again. Kind of connect into dots you, can use those fractal, points if you'd like you, can see how that intraday, once again acted as some resistance, backed off now. We're seeing an inside, day. Ok. What now, bears. Maybe looking to try and build up some strength to push, the market lower bulls, maybe waiting for an opportunity, to buy and see, if they're able to break, out of that now, from a very short term again, look in some of the previous highs kind, of a smaller, double. Bottom or a W, off of. That trend just, looking for some continuation. Last. One we'll look at is utilities. And. Utilities. Much, like the staples, and REITs. Or real estate being. More defense. Tied, to those yields, so, if yields, are falling. Those. Sectors would typically, benefit, if yields. Are rising may be more of a negative now. I we. Can see that, utilities. Are down about a half a percent I believe the worst performer, on the day, and. This. Was an example that we had tweeted out on on. Saturday, looking, at a longer-term, chart. There's. No guarantee, that this. Would be the the. End of. A trend. But. Looking at it from a weekly perspective, and see. If that actually refreshes. On how. How. Far away from some of the averages. The, utilities, have ran up it's been a great performer. Over, the last several, months I believe over the last year, no, guarantee that will continue, and there could be some signs, of that rotation, so, a bit potentially, a bit extended. One. Indicator that some traders may use to. Bring. That up is. An RSI, I believe that's one of the indicators that I tweeted, out. Our. Acai, basic, compares, the. Stock against itself it's an oscillator. If. I go ahead and so we can bring it up. Should. Be relative. Strength. Index. And. I'm. Not sure it up there it is right here RSI, we'll. Go ahead and click on that and did. Not take I. Must. Be dehydrated, doesn't, want to pick up the the, sensitive, touch of my fingers here so, we went ahead and ahead of that indicator, and if. I go ahead and click OK. And. I'm gonna go ahead and bring this up a little bit more on the big screen. Utilities. Had moved up into, kind. Of the upper, zone, in this. Case in the seventies, own and it, started dropping down this past week and looks, like that's continuing, at least, at the moment so we'll see if that continues to play, out there. Alright. Let's go ahead and actually review. Some. Stocks that may have some, similar, patterns. Here. Let's. Make sure we don't have any questions here. So. We'll go ahead and take a look at a. List. Of the penny increment stocks you. Can customize your watch lists however way you'd like, let. Me try and do two all I'll leave the scratchpad on, for. Those of you if you like, the example, of the chart or if, you want to utilize some, of these practice. Scripts, they. Are listed, here on the scratchpad. Go. Ahead and see if I can make a little room there we'll leave that there.
All. You simply need to do is one, step at a time go to setup in the upper right hand corner, and select open. Shared, item. If. You want to take a deeper dive you can look at some of my, previous sessions, I did, do, a session. For James Boyd last week if, I go to education. Make. Sure you select the education, tab. And. In. That list we go to webcasts, and. Once. On webcast, you. Can go ahead and, select, the archive. Once. There you can select an instructor, that you're looking for a recording. Once. Again I'm John McNichol and. You. Can go back and look at some, of the previous, sessions. Let's. See. It. Looks like the session I did late. Last week may, not have posted. I'll go and double-check on that. But. One if you go, down the list as far, as for the script. That. Would be dated. August. 27th. Script, in studies on thinkorswim, trend, and bounce scripts that, is the one that is covered, here and that's. The one that Ken Rose does every, week at, 5:30. P.m. Eastern, Time if you, wish to learn more about other ways of, creating. Some productivity, tools for the platform. So. With that looking. At, the. Penny increment list notice I have a column, here as well for, sector. And. You. Can, right-click and. Select. Customize, if you want to actually bring up the sector you know we did some top-down analysis. You. Can type in the word sector, and add that as a column. Good. Afternoon Anthony thanks for being with us and so, that way you know if there is a certain, sector that stuck. Out for you. For. Instance we are looking at healthcare. As. Far as some of the potential reversal, patterns, or energy. You. Can go ahead and sort by sector. So. Like here's a few energy stocks that are on here right now, let's, say I'll go ahead and bring up a. So. We got a three-months chart there that's okay. Go. Ahead and focus on some of the price action. And kind. Of going down the list there and. We'll, bring this up on the, big board as well one, can go ahead and scroll down and see if they can recognize any, price, patterns, so, you know looking at Seadrill on. This example, price. Is still down trending, you know maybe signs of a little bit of reversal, but notice, and moving averages are still generally. Going down implying that trend being. Down. Also. Looking at a lot of the script they're showing in more negative, territory implying. That the faster, moving averages, are below, the slower one. More. From, a bearish perspective, but, things can certainly change. If. I go ahead and just click on a couple of these and see if there, is a potential pattern, we may see some similar that we saw on the. On. The industry, itself for, instance for Exxon Mobil our, earnings are going to be coming out. Middle. Of November. Looking. At the lows we saw, a test of those lows and we had a bounce, if. You look even, closer from a shorter term standpoint.
Again. Comparing, the, highs and the lows would. Determine. That potential. Trend as we're, waiting for the screen and, if I go ahead and compare. Those. Fractals. There there's. A low there's. A high there's. A higher low and. Just. Pushing a little bit higher, so. Possibly, the first signs that reversal, now some, traders on a major reversal may you. Know look for more of that crossover. There so, we've seen a break, of that downward trend that, could be initial, change, in trend, otherwise. They may be looking for a break, of a, price resistance or, going. Above that moving average. Let's. See what else we got here. Kind. Of looking at some of the more, larger, cap. Ones, Conoco. Leave, this is Conoco, Phillips. Here. Now. This, has been common on a lot of stocks after that downward move we've seen a rally up and coming, up on that resistance, broken. Rizz has a tendency, of acting, or correction, broken support has a tendency, to, act as, new. Resistance. So we had a break in support, and we're, coming up on that resistance but. Notice after we hit the resistance, it, didn't just turn into a bearish, candle, and start selling off prices. Are trying to hang around that area so we may see a break. Positive, crossover, price, breaking, back above that major, moving, average okay so you can see how some, of the what we saw patterns, on the sectors translate. On some of the individual stocks. Let's, see one. That kind of stands out that. Actually. Looks like generally, has been trading. Higher. Let's. See that is and actually, looks like that's a stock that stopped trading a PC which that would explain why it would pop up on here well. It's if any other ones. LNG. Cheniere. We're. Seeing some more positive crossovers, and again, looking at kind, of a break at that downtrend, now energy markets, do have a tendency of being you know rather, volatile. But. We can see from a technical standpoint. Break. Of that downward trend, we're. Seeing low, lower. Low. Potentially. A higher. Low or a higher. High would. Translate into a trend. Reversal and breakout all. Right let's. See how we're doing on time here. And. Make sure we don't have any other questions thanks. For everyone's participation here. Let's. Scroll down a little bit and see you know if there's more. Positive. Breakouts. Here so we'll go ahead and we'll clear that out and. Kind. Of scrolling down you, know you can sort some, of these column, scripts a. Certain. Way. So. I go ahead and click from top, to bottom it'll. Show stocks that tentatively, maybe breaking. Out of a pattern, what. It is saying is that within, today, or possibly, one, or two days previously there, may have been a positive, crossover. Implying. That, breakout. And, then. If you, look you, what are some of the stocks that are coming up well, some of them are health care so here's a ba, X for. Baxter there and, we. Can see. The. Characteristics of the pattern that we saw with, health care from. A shorter term lower. Lows. Transitioning. Into higher lows and as. We look at the resistance, we. Had a break, of that pattern and prices.
Are Pulling back to settle. For a potential. Bounce, this. Pattern. Is what, traders, may refer to as a, flag. When. There is a sharp. Move, up, and. A. Little bit of a pullback over, a couple of days this, is actually a setup that we would take a closer look at tomorrow, at. The market open in the swing, trading class days to weeks where, some traders may be looking for that shorter. Term, trade. Alright. Now. Let's go ahead and take a look on anything. Else on some of the industrials. Let's. Go ahead I'm a sort by sector. And, let's. See if a couple of the industrials, that may be on there. UTX. United. Technologies. This. Is an example of a reversal. Or. Potentially. A continuation, of, the, overall, trend. When. We look at the moving average I notice. The price did go below some of the mott the major. Averages there, let's, try that again. Transition. In lower. Lows to, higher lows. Looking. At that resistance, a diagonal break, kind. Of similar, to the last example that, we looked at breaking. That resistance, possibly. Flag, in there. Now earnings. Are coming up so if some traders are looking for. Some positions you know they may have to speculate, through, an earnings, event if they're, not looking to be in it for more than a few, days. Okay. So. Hopefully you learn something new a 3m. Another. One. Now. This one has been beaten down it is below, some, of those major moving averages, but notice, some, of the characteristics. Over the shorter term. There's. The intermediate, trend the shorter term trend had got a pretty strong bounce, found, a little resistance, some, traders may be looking for that breakout, earnings. Maybe a driver. On that. And. Then, let's go ahead and, see as we, go and round things out. Let's, see on a consumer. On another, industrial why RCW. Worldwide. Kind. Of a signs of a potentially, a larger, reversal, as. Notice. It was below, its intermediate rent. Price. Action making. Lower. Lows. It's. Making lower highs and lower lows then. It made a higher high and it. Just, kept going higher put. On its pullback making. Higher lows. Notice. We're seeing positive crossovers. As price. And the moving averages or coming above each other if, I take a look at this from. A bigger perspective, look. At the, see. If I can zoom in on this a little more and, looking. At the. That. Did not quite work out as intended, let's go ahead and back over here. Is. Looking. At the. Bigger. Picture. And kind. Of characteristics. Of and inverse, head-and-shoulders. Gonna. Use the drawing tools on thinkorswim let's. Go back, here. And. Looking. At just. Connecting kind of on a price area, that. Transition, of price is making lower lows, to. Higher lows, there. Was a breakout price blue back and looking, for another attempt to trade higher now this is a relatively, cheaper stock to they have a tendency of being. Volatile. Anyway. But. We can see that these same patterns occur. Regardless. Of, where, the price is at. I'll. Bring up one last one win. On. The, game inside and we. Can see again. Some of the characteristics, of a. Bottom. Information, lows. Equal, lows abouts, traders. May be looking for a break above, that resistance. If. We want to we can go ahead and right-click and. Select. Free. And alert and. A. Door above. And. Put. In a note to alert you on, that. Condition and then you can make a decision on where to go so, bright. We're gonna see is with some of the news events for the week folks and I know we're running at a time. Kind. Of a run down for you. With. Today being Columbus, Day not very news intensive, but, as we go into the. Rest of the week, some, catalysts, that some traders may look for unless. Your water news isn't loaded up here. Looking. In the US in the pre markets. We. Should be seeing some information, coming out on retail. Sales I believe. We may see some, CPI, coming, out as well although that could be coming, from somewhere, else on North America. As. We go into Wednesday. Retail, sales is, going to be a big one coming out. And. Going, into Thursday we'll, see some other things coming out on industrial, production.
As Well. As run the Philly Fed. Business, Survey, so that could be some catalyst, for, these, patterns, breaking out for the reversal, patterns to be breaking, out bullish ly and for, some of the more triangles. To potentially, break down, all. Right so we weren't able to get a trade, in this, afternoon but maybe you can join me at the market open tomorrow for. Swing, trading days two weeks will, we'll go ahead and we'll see if we can put in a few swing trades over. The next week on our practice account so, thank you so much for being with us here folks, remember. In order, to demonstrate the functionality platform. We had to use actual symbols, keeping in mind TD Ameritrade does not make recommendations. Or determine. The suitability of, any security or strategies, through the use of our tools any, investment, decision you make in your self-directed account, is solely. Your, responsibility what. I'd like for you to do is, go through your watchlist and, you. Know if it's a big list maybe, you know first, ten or twenty and. Identify. The. Sector, and. The. Price pattern, that's in there and see how that ties up with our review today and see. If you may be able to do a practice, trade on any, of those pattern, breakouts, so take, care everyone we'll let you go for the day coming up at the top of the hour should be Brent Moore's with. Selling, calls. Or selling puts and cover calls so, stay tuned bye, now. You.
2019-10-18 20:34
