[Frantz Herr]

New thread

[skoutasg]

WBA: Markup or bust? Does the apparent successful test signal a markup is in the works? Looks, maybe. What do you say?

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[shhmi9]

markup for me

[Kenneth]

UTAD imho on daily.

Long term weekly bias looks in Distribution

Short term Daily bias looks Distribution as well.  It would need a convincing break above the long term resistance area before change of behavior.

 

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[skoutasg]

Ken/WBA: Sadly for me, I think you may be right about this stock being in Distribution both on the daily and weekly charts at least by my count. What caused me to think otherwise was the stopping action shown by the green bar. By my thinking the Smart was slowing down the advance or covering its short position prior to another leg up?

[ArkadiyRezviy]

I even think that this is accumulation, but this is my opinion

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[ArkadiyRezviy]

I even think that this is accumulation, but this is my opinion

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[ArkadiyRezviy]

Top ap,imho)

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[Kenneth]

MBII : Maybe this will come back to 1.50.

[Kenneth]

TYME: BUC on Daily.

[Kenneth]

Bias Game #80. What does everyone else think?

[Kenneth]

Good job on all distribution analysis

[Kenneth]

I am going Accumulation:

Really weird range I see but oh so wanted to go distribution.

[ArkadiyRezviy]

IMHO.

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[Kenneth]

One other thing I forgot to put on the chart was the swings marked in magenta.  They seem to winding up to something like a spring.  Smaller spread on less volume on all three.  Maybe significant.

[Kenneth]

The gaps are interesting as well.  I would say the most important bar on the chart is the gap bar right after the Spring #3 in Jan. All the other gaps up after a decline all happened on higher-ish volume. This one was on relatively quite volume in comparison.

Sorry for the ongoing dialog.  Way too much time spent on this one.  Will go ahead and post an updated chart.

[Frantz Herr]

I think it’s Distribution, but I could make a case for Accumulation. 

[Kenneth]

Hey Frantz

I saw the same thing at first from your #2 point but went with CO absorbing instead of the supply attempts.  Just went with more of a higher level absorption instead.  Definitely could be way off on this one because it really does look like a rounding top with a cup and handle pattern forming.

[Frantz Herr]

New thread/Curt

[Kenneth]

Trade for the week – GNUS distribution

The chart looks pretty much like the setup from last weeks Bias Game in my opinion.

Trade POE#1 starting position break of red uptrend line with S/L just above LPSY and resistance @ 1.50.  This price area has been support and resistance multiple times.

Add on area on backup to uptrend line after break.

POE#2 addon area would be break of 1.30 which is just below LPSY with S/L at just above 1.50 same as POE#1

Two ways to Sell: 1) Identify a small spread/volume day at the place of primary selling opportunity and SELL; 2) SELL if the price is running away decisively from a place of primary selling opportunity.

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[Kenneth]

Skout looks to be right on this one.  My analysis looks to be off.

[Curt Miller]

Kenneth:   I agree that the bias is currently distribution but still needs to be confirmed.  Also like your POEs.  My only comment is would it be smart to sell short during a market uptrend?

[Kenneth]

Great question again and not sure to be honest.  Have never sold a stock like this before so I guess it needs more thought after all.

[skoutasg]

Kenneth:  IMHO.  I see the current trading range as accumulation.  Either we are presently looking at a LPS or a continuation in the trading range for a while.  To me, the trading range is quite narrow so I would not want to enter any trades.  However, I might consider a long position when price exits the trading range.  Just my 2-cents worth.

[Kenneth]

Thank you skout for your comments and view.  Definitely see the accumulation scenario as well but still leaning to distribution.

 

[Curt Miller]

I’m curious how everyone incorporates the major indexes (S&P, NDAQ, Dow) into their trading.  Obviously we should be trading long positions in an uptrend/accumulation range and short in downtrend/distribution range.  How do you manage your positions if you are starting to see weakness in an uptrend?  Would you let overall market conditions affect your decisions on existing positions or do you let market action of the instrument do that?  We are in an uptrend right now but appears to be struggling.  Is it still ok to open long positions?  How does everyone apply overall market action into their trading plan?

[Frantz Herr]

[Frantz Herr]

Curt, I don’t see enough on this chart as yet to tell if we are getting a ChoBev which will lead to another TR.  It depends on Supply.  Pretty sure the volume spike (3) will be tested.  For me, overall market condition is the first thing I consider in my trading plan.

[Curt Miller]

Frantz:  Thanks for sharing.  If/When we see a Change of Behavior how do you incorporate that into your trading?  Do you close positions and wait and see how the TR resolves itself or do you hold?  Or do you make the decision based solely on the individual instrument.

[Frantz Herr]

Curt, I think you are thinking more about exits than entries with your question?

[Curt Miller]

Frantz,  Yes I am.  I am still working on figuring out my exits in my trading plan.

[Frantz Herr]

Curt, an idea: try picking a few of the stocks you follow and see what they did from April to December 2019 and look at what the market did in that same period. You will gain some valuable insight.

[Curt Miller]

Frantz,  I guess I’m not following what you are getting with this exercise.

[Frantz Herr]

Curt, any charting service that lets you set the date range on the chart will work, I use StockCharts.  Start off with a daily chart for one of your stocks with a date range ending December 15, 2017 and beginning 6 months or a year earlier.  Why December 2017?  There was a general market selloff in February 2018.  Imagine you have a position and then start advancing the chart one day at a time.  As you advance the chart, you will have to make decisions about what to do.  Do this for several of your stocks.  The decisions you make will help you fine tune your exit rules.  Then do this over again but this time use a start date of August 2018 because another market correction started that October.  Once again, imagine you have a position and you are trading it.  This time test your exit rules by using them for your exit decisions.

You can make your exit rules contingent on some general market trigger.  You can make them stock specific. You can use a combination.  Whatever fits you and your style of investing.  By doing this backtesting you will learn what works for you without putting actual capital at risk.   Hope this answers your question.

I’ve done these types of backtesting simulations for over 100 trades so far and I find them very effective.

[Curt Miller]

Frantz:  I have tried back testing like you describe but it is always a very frustrating process for me.  I can never seem to make any rule that seems to benefit.  Each time I have created a rule the next trades don’t seem to benefit from it.  Either I haven’t created a rule that works or I am not sure what I should be looking for.   I guess I’ll just have to keep at it.

[Frantz Herr]

Curt, I have entry and exit rules but they are designed for the way I trade.  I’ll be going over how I used post-trade analysis to create them in my blog. It would be great to create your own rules based on Curt.  I like what Skout said about using Wyckoff logic with indexes, it is very useful to notice how they are behaving because most stocks will be more or less following along.  I think everyone would agree that the best time to buy is at the beginning of a general market advance.  The current rally is 11 weeks  – almost 3 months – old.  Given my approach to this game, that is something I think I want to pay attention to.

[skoutasg]

Curt:  Why not use Wyckoff logic to define distribution or accumulation for the indices you follow?  All equity indices should closely agree.

[Kenneth]

Curt, I just saw what I did by hijacking your thread.  Really want to apologize for that.

Really good question.  I will need to think on that myself.  I have multiple positions open now that I am having the same hesitations about that.

I would say #2 let market action of the instrument do that.  One thing for me is that I buy low, primarily small cap right now, so mine would not follow market conditions a lot of the time.

I think Frantz answered one of my questions on something of the same subject a few days ago with.  I will put it here but will let Frantz continue his comments for himself on this.

Kenneth, in a true bear market, which I associate with an economic recession and which normally occurs in approximately the first 1/2 of an economic recession, the best place to be is in cash imo.  Second best place is high grade bonds.  As individual investors, we have the ability to move a large portion of our portfolios to cash, something many institutions generally can’t do.  Hedging can possibly be accomplished with options, selling short, or using one or more of the inverse products that are out there, but it is tricky and not easy to execute imo.

[Curt Miller]

Kenneth:  No worries.  The forum set-up is a little frustrating at the moment.  Looking forward to when it gets revamped.

[Frantz Herr]

New thread

[skoutasg]

TLT/IEF etfs:  Back for a discussion about the rising 10-year yield curve.  If long-term rates are rising, this cannot be good for the USA, as higher rates will have a dire effect on the cost of doing business.  If true, what weapon(s) could the Fed employ to stop the rise in rates?

[skoutasg]

Answering by own question.  Maybe the steepening curve is a good thing, as investors will seek to buy those higher yielding bonds on the long end?   Cost of debt financing goes up, but they put the new maturities off for 10-years.  For sure, higher long terms rates will have a negative effect on real estate values.

[Kenneth]

GPRO accumulation.

 

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[skoutasg]

Kenneth:  What’s your plan and or trade?  IMHO, you may have missed some pertinent structure since the high?  On the weekly, the stock appears in markup already?  What does the smart money have in mind nobody knows?  For sure, they will empty their inventory stores before reversing the trend.

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[Kenneth]

Thanks for the feedback skout.  Not sure to tell you the truth for a trade.  Like you said there is still some more market structure but am still thinking accumulation bias long term with maybe a pullback short term, nothing backing that up though and just a guess, not even an educated guess to be totally honest.

[Frantz Herr]

Kenneth, I’m sorry but I couldn’t figure out how to just delete the chart of TYME from your post.  Everybody, I deleted the entire post, and evidently when you do that it clears every other post in that thread as well.  Hopefully it’s not a big hassle for you guys to repost.  Sorry again.

[Kenneth]

No problem Frantz.  Thanks.  Will post again.

[Frantz Herr]

New thread

[Curt Miller]

Hi Frantz.  Would you start a new thread for me?

[Kenneth]

Bias Game #79.  My answer is Distribution.  What does everyone else think?

[Frantz Herr]

Kenneth, I like your logic but I see it differently, so my vote is for Accumulation.

[Kenneth]

Hey Frantz.  I kept looking at accumulation as well but what keeps me distribution is the inability to break past that gap resistance.  Maybe with that last bar it will break through.

[Frantz Herr]

Kenneth, I think you nailed it.

[Kenneth]

My solution for Distribution

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[Frantz Herr]

You’re one of very few to catch that this week.  Nice job!

[Kenneth]

Thanks Frantz

[skoutasg]

Wyckoffians:  Like a wolf in the night, higher interest rates are coming.  How much longer before the markets’ tank, no one knows.  Who can calculate the carnage on the US economy?  Can the Fed handle the stimulus needed?  Is the end near?  As they doomsayers have been saying for a while, eventually the piper becomes due.

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[Frantz Herr]

Skout, is the end near?  Not quite yet if history is to be our guide.  Historically a steepening yield curve caused by rising rates at the long end is bullish for the economy because the bond market is starting to discount surging demand and inflationary pressure.  If the economy is getting stronger, it is positive for earnings.  The yield on bonds starts to compete with stocks so the stock market gets pulled in different directions and volatility picks up but no big cracks.  Historically, it has been when the Fed becomes worried about inflation and raises the rates they control at the short end – when they start flattening the curve – that’s when the bad stuff happens.  At least that’s the way it’s worked in the past.

[skoutasg]

Frantz:  You are correct.  Got confused with the idea of an inverted yield curve, which differs from a steepening yield curve on the long end.  Can you suggest what sectors may do well over the next year from what we know now?  Best, Skout

[Frantz Herr]

Skout, not investment advice but it’s good to watch where the big money is going, so I keep up with that.  I subscribe to MarketSmith and they provide a performance ranking of their 197 industry groups which I keep track of on a weekly basis.  Here are a few at the top of the pile.  There have been some big movers lately as you can see.  In general, it would seem to me that beneficiaries of higher rates and a strong economy with the ability to easily push through higher prices to their customers would be good candidates.

[Frantz Herr]

Another effect of a strengthening economy is demand for money in the real economy starts to pull liquidity away from the financial markets so there’s less fuel for the stock market.  Another reason to expect increased volatility, but not quite ripe for Niagara Falls yet imo.

[Kenneth]

Skout:  Interesting.

Everyone:  What would one do to protect/hedge their portfolios in this case?

As for me I am at a loss and ask because it would be interesting to see others opinions

[Frantz Herr]

Kenneth, in a true bear market, which I associate with an economic recession and which normally occurs in approximately the first 1/2 of an economic recession, the best place to be is in cash imo.  Second best place is high grade bonds.  As individual investors, we have the ability to move a large portion of our portfolios to cash, something many institutions generally can’t do.  Hedging can possibly be accomplished with options, selling short, or using one or more of the inverse products that are out there, but it is tricky and not easy to execute imo.

[Frantz Herr]

New thread

[Frantz Herr]

Everyone has their own way of approaching the markets.  I’m a stock guy (and a precious metals guy).  My process for stocks is to identify ones with outstanding fundamental growth characteristics using a screen based on William O’Neil’s CANSLIM methodology.  From that list, which I update every week, I look for Wyckoff structures.  I have a written Trading Plan with rules for where and when I can enter, where I place my stops, where I can add, how and when I exit, risk management and so on.  Because of my bottoms-up approach, I find myself doing a lot of stalking, waiting for the right chart setup.

ACEL is a small cap stock in the gambling business.  They install one armed bandits in truck stops.  So far, they are in IN and IL, and they just got permitted for PA.  The stock has been on my WL since last September.  I just updated its weekly chart.  Have a look.  I am observing a test at x-y-z the last three weeks on low volume.  I am wondering if this might be the LPS for another rally, with the potential to exceed the previous highs on the chart.  Feel free to give your take on the bias-timing-character.  If you disagree with my analysis, say so, you won’t hurt my feelings.

[Kenneth]

Bias acc.  Not sure to be honest in this one but just had to attempt it but nearly went distribution with Skout as I can see a case for that as well.

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[ArkadiyRezviy]

Imho.!

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[skoutasg]

Frantz:  I find myself the party pooper again.  It’s distribution, IMHO.  Too technical for me.   Time will tell.

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[Curt Miller]

I appreciate the in depth analysis on this.  Its hard to make heads or tails.  The price is currently in the “white space” between the support zone and resistance zone.  I would feel more optimistic about it after price breaks out over the bar labeled 2a but after that it has a large bearish bar to overcome with significant supply.  Would expect a reaction there.

[Frantz Herr]

Thanks everybody for your feedback!  I agree it is confusing.  No position at the moment.  I like Arkadiy’s wedge formation, hadn’t caught that.

 

 

 

 

 

 

 

 

 

 

 

 

 

[Frantz Herr]

New thread

[skoutasg]

IBM:  Yes, it may be true, dogs do come back to life, eventually.  Here’s another much maligned blue chip awaiting a retest before launch?

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[Kenneth]

This one is interesting skout.  Thanks.  We are suppose to choose a stock for the WTC II course to trade the whole class and was looking for one off the beaten path.  This was one I thought about but did not look at.  Think I will put this one through as a vote.

Still not convinced of the retest before launch though.  See something that looks like acc bias on M, and may be, but feeling off somehow.  Will look a little more.

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[Kenneth]

Ok, Long term bias is Distribution in my very humble opinion.  Phase |B| right now  Think we are waiting for a UTAD which looks like we may be starting.

Need to look at smaller time frames for bias but looks like Accumulation has started as skout has suggested.

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[Kenneth]

Medium term seeing downtrend continuing with another leg of distribution.

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[Kenneth]

Short term am seeing distribution bias as well.

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[skoutasg]

OMC:  Another long suffering long-term candidate which is coming off its bottom.  Sector is XLC which shows strength.  Deep value stock with value of $260 based on dividend yield theory.  How long it takes to get there is anyone’s guess?

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[Curt Miller]

Skout – I like the setup of this one.  I calculated a $144 minimum target based on PnF count.  The only thing that concerns me is the RS.  There has been some strength recently but long term it is still lagging the market.  Thank you for sharing.

[skoutasg]

UGI:  If you like utilities, here’s a possible long candidate.  Target is $46.00 or 90% of overvalued, as determined by dividend yield theory.  Look’s like a good entry point?  Happy trading, skout

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[Frantz Herr]

Nice work Skout, thanks!

[Frantz Herr]

New thread

[skoutasg]

Anyone:  What say you, reaccumulation or distribution?  Why?

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[ArkadiyRezviy]

currently, the price is in a trading range. Watch out. But the stock is strong

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[Kenneth]

I agree the stock is strong.  If anything it would be a pullback but not distribution top IMHO.

Kept going back and forth to even try to say anything.  As one of the file names posted ways “No Idea”.  Probably should have taken a stance on this one and said I would stand aside until more chart and confirmation was shown.

[Kenneth]

Distribution based solely on structure.  Went to 2H because on Daily could not get a good read if it was acc or dist.

 

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[Frantz Herr]

Curt, we analyzed your AXTI today in AoT.  Roman also spent some time going over the Wyckoff Analytics courses, it is after that.

[Frantz Herr]

Kenneth, Skout or anyone else – if you have any completed trades you would like us to discuss in future recordings let me know.  Thanks

[Kenneth]

All of mine are still in play actually.

[Curt Miller]

Frantz – I just watched the video.  You did a great job explaining the trade and were spot on with my line of thinking.  The exit was because of fear.  I didn’t want the price to fall too much so I got scared and exited and the price promptly reversed.  That is definitely one of the things I need to work on.  My intention was a swing trade.  I was planning on exiting at $12 near my estimated PnF target.  It came up shy before reversing and forming a trading range.

[Frantz Herr]

TSLA has been on my WL since December 23, 2018 and I have never bought it.  SMH

[skoutasg]

TSLA:  Round and round it goes where it stops no one knows.

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[Frantz Herr]

New thread

[skoutasg]

MCK:  Daily Chart/ Reaccumulation or Distribution?

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[Kenneth]

Accumulation

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[ArkadiyRezviy]

Nice chart, Kenneth. My opinion.

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[Kenneth]

Did not see the apex.

[ArkadiyRezviy]

Sorry,local sclx.

[ArkadiyRezviy]

think this is local spring because the price will stay in the trading range

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[skoutasg]

Arkadiy:  Thank you for your comment.  Interesting.  For us to understand is your bias distribution or reaccumulation, or not committed at this time?  Can you elaborate?

[ArkadiyRezviy]

Accomulation.imho.

[Frantz Herr]

Skout – MCK, yesterday in WMD Roman and Bruce talked about industry groups.  Healthcare was interesting because it is showing an early reversal from underperformance to outperformance.  Nice to have that tailwind.  Here’s XLV:

[Curt Miller]

Thanks for sharing this Frantz.  I have MCK on my watch list but have been hesitant to enter because of the weakness in XLV.  I’ll have to take a second look.

[Frantz Herr]

I like the looks of MCK’s daily chart

[skoutasg]

Frantz:  Thank you for your commentary.  On the daily, XLV may have reached BC status, so where it goes from here is anyone’s guess?  Get your point.  I still believe MCK may be under distribution, notwithstanding the performance of its sector. Time will tell.  MCK is a so-called value stock, so seeing it possibly tank at this state is interesting?  Me thinks the market overall is being set up for the great rewind, IMHO.

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[Frantz Herr]

Yep, #1 Market context #2 Industry group #3 Individual stock

[skoutasg]

Kenneth:  Hope your right because I am long, but not yet convinced…

[Kenneth]

hahaha, I really like this one actually.  Based solely on price structure but did not go deeper.  I just usually stick to small caps.

How do you trade this?  Options or outright shares.  Mind you, not asking for amounts here, not at all.

[skoutasg]

Kenneth:  I do own shares.  All all the shares I own I try to buy low and sell high (no sh_t).  That means I look for a breakout from the trading range formed after a final SC.  So far, the weekly shows a possible BC while the daily looks like distribution, IMHO.

[Kenneth]

If you take the Head of the Head and Shoulders pattern there and from the neck line which is supposedly the move then it should reach around 230.00 which is just to the top of the BC.

[ArkadiyRezviy]

ufs

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[Kenneth]

Definitely Breakout.  Beautiful chart.  I really need to start a model folder to put all these types of charts in.

This shows a really nice example of a Accumulation/Reaccumulation with uprise

[ArkadiyRezviy]

Thanks Kenneth!

[Kenneth]

Here is another one that I think shows a nice example of Reaccumulation with uprise

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[Frantz Herr]

Urgent buying is present – looks like absorption on the way up

[Frantz Herr]

Looks like a breakout from BUEC

[Curt Miller]

I second your analysis Frantz.  Breakout from BUA.

[ArkadiyRezviy]

#2

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[Frantz Herr]

Bias Game #78 Solution

[Frantz Herr]

Weekend humor: But wait!  There really was accumulation!

[ArkadiyRezviy]

amd day😉

[ArkadiyRezviy]

@Amd 😉!

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[ArkadiyRezviy]

AMD

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[Frantz Herr]

👍

[ArkadiyRezviy]

game 78

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[Frantz Herr]

Arkadiy, I must respectfully disagree:

[Kenneth]

Distribution

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[ArkadiyRezviy]

#2 .Thank you Frantz, you may be right. I do not know. In any case, I am always interested in your vision and your opinion

[Frantz Herr]

I think I’m wrong though lol

[Frantz Herr]

Thank you Arkadiy, the feeling is mutual.  We will know the answer to this Bias Game Friday!

[Frantz Herr]

Here is a count of the Dow Jones US Total Stock Market Index ($DWCF) that I took yesterday.  The minimum price target of the August – November consolidation has been met, so I am doing as Hank Pruden advised: stop-look-listen

[ArkadiyRezviy]

there are errors in counting, but a little))

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[ArkadiyRezviy]

JD

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[Frantz Herr]

JD has been on my Watch List since March 7, 2020 and I never pulled the trigger.  Shame on me!

[ArkadiyRezviy]

good job, Frantz, thanks. Nice chart.

[Frantz Herr]

Thanks Arkadiy

[Frantz Herr]

New

[Kenneth]

Am going to continue with skoutasg original starting topic:  Is ZNGA under reaccumulation or distribution is the question?

My vote is distribution.

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[Kenneth]

This is my analysis for distribution

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[Curt Miller]

I agree with Distribution.  I would be look at going short on break below $9.50

[Kenneth]

Curtis: I think this will even show a confirmation as we were discussing with AAPL.

[skoutasg]

Hi Gang:  My AAPL chart may have gotten lost in the many recent posts, so I post it again.  Is AAPL under reaccumulation or distribution is the question?

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[skoutasg]

Arkadiy and Kenneth: RE:  AAPL:  Thank you for responding.  Distribution, yes that was my guess.  Amazing how the Smart Money can array prices to keep the game going unless you have some knowledge of Wyckoffian logic.

 

[ArkadiyRezviy]

imho

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[Kenneth]

Just based on the small daily I am saying distribution but not confirmed

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   AAPL-D-Dist.png
   

[Curt Miller]

Kenneth:  What would be confirmation of a distribution in your opinion?  For me I would think a lower high that fails to go above December high followed by a break below the Jan 4 low.

[Kenneth]

Was thinking more of a break and retest of the lower wedge uptrend line in combo with the upper TR line.  A lower high would strengthen it.

Good question Curt.  Thanks for asking it.  Do others have another way of looking at confirmation?  I think that would be another good topic on new list.  A channel on what people look for as confirmation.  It is all over the place about waiting for confirmation but everyone will look at it differently.  This could also include volume or indicator of some type.

[skoutasg]

Frantz/Gang:  Okay, finally got your idea.  Attached a weekly chart for AJRD which Bruce recently reviewed.  Noticed in this case, he referred to the March low as the selling climax (SC).  Maybe mistaken, but many previous charts I’ve seen Bruce identified the March low as a shake out (TSO).  Question for the Group, why with AJRD was the March low identified as a selling climax (SC)?  Is there Wyckoffian logic that can be applied?

Attachments:

1. 

   AJRD.png
   

[Curt Miller]

I’ve noticed this phenomenon as well.  Early on I was confused how a BC could transition into a SC.  I always thought it was BC then AR.  As best as I can understand, the price has gone down so much and the AR fails to go near the BC and ends up a trading range well below the BC.

[ArkadiyRezviy]

maximum volume. Spread approximately 15%. Close approximately in the middle of the candle. Classic spring

Selling Climax (SC): A situation characterized by the highest intensity of speculative supply occurring within a downtrend. This situation occurs only after a move has been in effect for some time. This condition marks the end or the approaching end of a particular downtrend. This panic selling creates an extreme expansion of the price spread and an expansion of the volume, this action may occur over one day or over several days. If it does NOT HAVE THIS IT IS NOT A SELLING CLIMAX. The Wyckoff principle of the selling climax does not always occur at the end of every decline. All that the (ST) of the (SC) does is STOP the DOWNMOVE.

Attachments:

1. 

   ajrd-1.png
   

[skoutasg]

Arkadly:  Thank you for your reply and explanation.  Attached another look which identifies the March low as a shake out (TSO).  Hence, we are dealing with an accumulation or reaccumulation structure in either case.  Subjective?

Attachments:

1. 

   AJRD-2.png
   

[ArkadiyRezviy]

2.

Attachments:

1. 

   ajrd7.png
   

[Frantz Herr]

Arkadiy, that’s a thing of beauty!

[ArkadiyRezviy]

in my opinion

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1. 

   ajrd77.png
   

[Author]

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