The topping formations with indices like the QQQ – Nasdaq 100 ETF and the SPY – S&P 500 ETF are still very much alive. There is tremendous distribution going on in the markets.
There is no way to tell if this is going to end up only being an intermediate term top, something that in hindsight would be looked at as a ‘correction’. Or, if on the other hand a much more pronounced correction is forming that will end up being the beginning of a ‘nasty bear market’ lasting much longer.
Stocks like AAPL have formed clear bearish head and shoulders chart formations. The technical price target implies much lower prices below $80 US Dollars for AAPL – Apple. This most likely means additional serious selling pressure for various indices for at least another few weeks.
Click on AAPL – Apple chart to enlarge:
Members are still in cash and not fighting this downtrend. Learn how to keep your profits and get more analyses like the one above: Tischendorf Letter Premium
The Tischendorf Letter Premium introductory price expires on February 1st. On February 2nd the price will go up. Act now to lock in the lower price offer.
Here’s a quick reminder of what you get:
Technical analysis education from a discretionary position trader with 17 years of trading experience.
My trading method is a combination of:
Gauging story stock potential
Identifying proper pattern pressure
Members, especially less experienced traders, were advised to trade very lightly going into 2016 and a special mid-week update was sent out in the first week of 2016 to go to cash. Members have benefitted from that call and were able to preserve their capital during this downturn. When the time comes to be aggressive again we will get exposure to new leading stocks.
One of the most widely followed stocks, TSLA – Tesla Motors, is about to reach a very critical chart juncture. The CEO Elon Musk is famous for his involvement in SCTY – Solarcity and SpaceX. Everything looks bright, like the iconic Tesla logo:
Let’s take a look under the hood and see what a simple and easy to understand technical analysis video of TSLA’s stock chart can reveal:
The key takeaways are:
The weekly chart is still in an uptrend.
A complex bearish head and shoulders pattern has formed.
Price is trading below the weekly moving 30 average in blue.
A right shoulder might be in the making.
If the uptrend breaks it is best to protect your position.
If the pattern triggers the purely technical price target could be devastating.
Conclusion: Due to the very bearish technical price target, the main risk for TSLA holders is to give back a big portion of their profits. You can protect yourself by selling at the various price levels I outline in the video.
The bearish trend with Twitter – TWTR keeps trapping a lot of traders. This price behavior is the exact opposite of social media winning stock Facebook – FB. Following a few simple technical guidelines will help you avoid painful losses in the future. I believe the main reason why so many are stuck in ‘hope mode’ with Twitter is due to a very common human tendency.
People use the product, I do use Twitter as well, they end up liking it a lot and then they draw conclusions. In this case they equate the company and their positive user experience with the stock.
Drawing such a conclusion can be a very painful and costly experience. Just because a company is perceived to be great doesn’t necessarily mean its stock price action has to be great as well.
Click on Twitter – TWTR chart to enlarge:
Following a few simple rules will make sure you avoid a lot of pain. As you can see in the chart above everything happens for a reason. It should come as no surprise that TWTR closed at an all time low today. Here is how everything started:
Price couldn’t print a higher high.
Long bearish candle cutting through the major moving average 200 like a hot knife through butter.
No retest of the MA 200. Zero technical strength.
Gapping down after hitting the moving average 50 resistance.
Reversal candle without capitulation volume.
Still no capitulation type volume.
Every single observation listed above was a danger sign and a signal to exit a money losing stock trade.
Profit from my 17 years of trading experience. Learn how to correctly interpret technical signals and get exposure to the best leading stocks: Tischendorf Letter Premium
My goal has always been to help you understand the markets and help you become a better trader. This is exactly what I will continue to do going forward. 2016 will mark the beginning of my 18th year of trading the markets. Running a premium service is the best and most effective way for me to pass on my experience. This will allow me to devote more of my time doing what I love to do. It also ensures that for years to come my time is spent with traders who are highly motivated, have a strong desire to learn and are willing to put in the necessary effort.
You get technical analysis education from a discretionary position trader with 17 years of trading experience. My trading method is a combination of:
Gauging story stock potential
Identifying proper pattern pressure
Coaching on Skype offers you 1-on-1 Private Access while I share my screen with you.
Frequently requested topics:
Technical analysis of individual portfolio positions
Historical trade review
What is optimal pattern pressure ?
Analysis of your strengths and weaknesses
Risk control, position sizing and stop loss placement
Overall the market still isn’t displaying optimal conditions for position traders yet. But there are lots of constructive chart patterns emerging. My scanning is starting to generate more and more decent chart set-ups. As I’ve said in the past, the main reason I scan is not to find candidates that are worth buying the next […]
As I just posted on Twitter, I am very pleased with my summer break timing. I kept almost all of this year’s profit, protected precious mental capital and recharged my batteries. The past two weeks I’ve gone through lots of charts and have rebuilt my watch list. To be more precise, I usually run a very extensive watch […]
Recently I posted a chart of the SBIO – ALPS Medical Breakthrough ETF. Here’s my original tweet: $SBIO Best-of-breed Biotech ETF with measuring gap pattern. $IBB $XBI $RDUS pic.twitter.com/noinl0izND — Olivier Tischendorf (@Tischendorf) July 15, 2015 Here’s the chart in case you can’t see it: Best-of-breed Biotech ETF is the most fitting term that comes to mind. […]
India is shaping up to resume its bull market. The most natural thing to do, as I wrote in my chart annotations, is to look for the strongest stocks around. Get exposure to the best stocks. That’s how you dramatically increase your odds of profiting from a bull market that might unfold in India. Ideally […]
A few days ago ATRA – Atara Biotherapeutics announced a private placement. The key is how a stock reacts to such news. If your goal is to reach peak performance in trading you pay attention to price and you ignore everything else. The reaction to news and the technicals is all that matters. It is […]