A Year Without Santa?
As the pre-Christmas period ends today, investors begin to look forward to the new year and the potential for a Santa Claus Rally. While the concept of a Santa Claus rally has been corrupted to some degree, the next seven days could be big for more than just 2021 window dressing. That’s because Santa’s delivery…
Early 'Santa Claus Rally' Abandoned Babies (Figuratively)
I get it, the title is a little morbid, but how else do you introduce the Abandoned Baby candlestick pattern? You could call this pattern "Buddy" after the movie "Elf," but he was more of a stowaway. No matter how you view the price action today, it is a significant indication of support and the…
GSK Option Bulls Get Head Start on Cup & Handle
Pharma has been one of the best performing industries in recent weeks and GlaxoSmithKline PLC (NYSE: GSK) has been among the top performers. Today, it appears that call buyers are stepping into the stock as it tests its resistance near $43.50. As the price rallies, it is close to confirming a cup-and-handle price pattern. It…
Bulls Find Silver Lining Into the Close
The S&P 500 rallied and the VIX fell into the close as the market found intraday support. While it isn't exactly a ringing endorsement that the market is heading higher, it is an indication that the Grinch hasn't entirely spoiled the fun. Looking at breadth, there was an early indication and bullish unusual option activity…
Price Patterns 101: Gaps (Breakaway)
Gaps are a frequent occurrence in the price of stocks. That's because they're closed for most of the trading day. Sure they have extended hours trading, but most people only look at the cash session. As a result, the movement that occurs overnight has an impact on the price the next morning. Even without extended…
Candlestick Patterns 101: Doji (Southern)
The SPDR S&P 500 ETF Trust (NYSEARCA: SPY) nearly formed a doji yesterday as the close was only slightly higher than the open. The early indication of balance reversed following the FOMC policy statement today. That's the early indication this pattern can provide. It's about balance after a sell-off and the exhaustion as the price…
Ford Option Bears are Rollin’ Out!
If you’ve been following Ford Motor Company (NYSE: F), you know that it’s performed very well since mid-September. On Friday of last week, the stock also staged a significant breakout when it closed at the highest price in over 10 years! If you’re bearish, what do you no when your puts have moved further out-of-the-money?…
Markets Get Defensive Ahead of Wednesday's FOMC
It was a cadry of interest rate sensitive sectors that led today as the U.S. Treasury market rallied on Monday. Not exactly the inflationary picture that is driving the more hawkishly toned Fed to tighten a more quickly. Of course, that result will be known on Wednesday, but the positioning in the stock and bond…
Options Market Eyes GDX Ahead of Seasonal Trend in Gold
Back on October 7, I wrote a blog post on the potential move in gold stocks. That indication came from the options market. As size comes into the options on an ETF like the VanEck Gold Miners ETF (NYSEARCA: GDX) it’s historically been a good time to watch gold and gold stocks. Well, guess what?…
Three Outside Down
What goes up, must come down…right? With stocks that’s generally the case and for the Three Outside Down candle pattern that is the signal. The idea of an outside day resulting in a downside move is a strong indication of a potential move lower. With the market near highs and wavering, this pattern may be…