MonthMay 2020

Facebook in 2013 and AAXN, CHGG and TWLO

Ajay Jani mentioned on Twitter it may be worthwhile to revisit Facebook’s move back in 2013 and compare with stocks over the past couple of weeks that have had similar gains in price and volume. The goal is to gain insight into how Facebook progressed after its big move up. Maybe this will foretell how stocks with similar price and volume signatures may play out in the coming weeks.

To begin, we’ll look at two charts of Facebook, paying attention to the price, volume and its upward trend. We’ll follow this with a look at three stocks, AAXN, CHGG and TWLO.

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Power Trend and How to Spot it on a Chart

In this week’s Stock Market Update, Mike Webster pointed out that the Nasdaq is now in a Power Trend. In this post we’ll look at what characteristics make up a Power Trend and we’ll also dive into three examples, two from dates in the past as well as the specifics of the current Power Trend.

Here are the primary considerations for a market to be considered in a Power Trend.

  1. Low above the 21-day for 10 consecutive days.
  2. 21-day above the 50-day for five days, without a break below the 50-day.
  3. 50-day in an uptrend.
  4. If the criteria above are met, for a power trend to begin, it must be an up day.

Once the 21-day crosses below the 50-day that is a sign the trend may be coming to an end. Mike also mentioned there are “circuit-breaker rules” that can end a PT before the 21-day to 50-day crossover.

It should be noted, I am using the Nasdaq for all the charts that follow.

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How to Create Custom Moving Averages

The default moving averages shown on a daily chart in MarketSmith are the 50-day and 200-day. Often times it’s helpful to view shorter term moving averages.

This short tutorial walks through how to customize MarketSmith to add a 21-day exponential moving average (EMA).

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Stock Market Update Charts – Week of 4/27/20

I created the following two charts you can use as a visual reference for @mwebster1971‘s Weekend Stock Market Update for the week of 4/27/2020.

The first image highlights the daily and weekly action on the Nasdaq. The second chart shows the 5-minute activity for each day of the week. You can follow the discussion on Twitter at the bottom of the post.

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