Udpate on SPX daily and 60 min charts with the BPT MA deluxe indciator

Here's the a daily and 60 min chart of the S&P 500 with the BPT MA Deluxe indicator, which I've shown before.  As you know the 60 min version turned red on May 22nd, today the daily version finally turned red (it's been green since Nov 23rd).  However remember this is NOT a system, its simply an exotic set of moving averages that that has a ton of settings that you can adjust.  It is not a system and should always be used in conjunction with other analysis.  Also please be aware that this indicator has NOTHING to do with the SPY reversion to mean systems.

Below is a write which discusses this MA set in more detail. Also note that as a BPT member you can get this indicator for free as well as these pre formatted workspaces, however you must have a Tradestation account and you must be a paying member, not a free trial member. 

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Here's the BPT MA deluxe MA, which is really just a fancy name for a moving average set that has tons and tons of settings.  It allows you to plot two MA's like at 20 and 50 or 50, 200 or whatever, and it also has 8 different moving average types that you can choose from (Simple, Exponential, Weighted, Triangle, Adaptive, Hull Weighted, Hull Expontial, and Hull Modified).  we can also plot just one MA and turn off the second (which is what I show in the sample charts).  It also slows the color of the slope of the MA (green when the slope is up and red when the slope is negative). 

The last custom setting it has is a whipsaw factor.  You've all seen my use the BPT confirmation method where you need a second candle to confirm the first candle of an indicator change, I've shown this with various moving averages, MACD crosses, RSI above or below 50%, stochastics above or below 50%.  However I added a whipsaw confirmation method to this MA that only allows the slope to change color if it is confirmed by a second color - this turns it into more of a trending indicator.  I've attached some images below of daily and monthly S&P 500 charts.  The setting that I'm using is a 34 length exponential modified MA (our #8 MA) with the whipsaw confirmation turned on, as you can see it's done a great job at catching most of the trends. 

For BPT members who have Tradestation I'm going to give you this indicator and a workspace for free so that you can play around with different settings and follow it on your own!   

Again note that even though the indicator appears to follow trend very well, I still don't like to use it on its own, I use it as a tool with other things and analysis.  For example on the monthly chart, I've found that whenever the RSI is oversold (which is a rare event on monthly charts), it's best to enter a long earlier than wanting for the MA to turn green - I've found taking the first MACD/BB green dot gets you in early (but only doing this when the monthly RSI was in a deeply oversold condition below 30%).  The first three charts show monthly S&P 500 charts while the last 2 charts show daily S&P charts, one recent and while from the past.

On the daily charts as you can see it's been green since mid November so has caught this whole move. 

**Click Here** to watch a detailed video of how this indicator works and how to use it 

I will be giving this indicator to all BPT members for free who have a Tradestation account.  However it's only for BPT members not free trial members (so sign up) if you want it.

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Our Recent Market Newsletter

**CLICK HERE** to view our most recent market newsletter

NYMO with Bollinger Bands - powerful indicator

The market is up nicely today, why? Well take a look at one of our bottoming indicators, the NYMO plotted with Bollinger Bands along with the SPX plotted above for comparison.  As you can see, every time the NYMO indicator has closed below its lower Bollinger Band, the market has bounced.

This is a powerful indicator for picking tradeable bottoms in the SPX and one of the many useful indicators available at Breakpoint Trades

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Technical Analysis on economic data

Here's a follow up to the Unemployment chart that I did yesterday, LOL I found out that Stockcharts.com already has a lot of this data already, therefore I created some extra charts for us with indicators of major economic data:

The first chart shows the unemployment rate plotted with RSI, MACD, and Stochastics.  Obviously MACD crosses can give nice signals as well as divergences that show in the RSI and MACD show major turning points such as in 2001 and 2007. The MACD has a negative cross in 2010 and since that time the unemployment rate has fallen.

The second chart is a plot of the U.S. GDP going back to 1980, obviously it's been uptrending since that time, however those of you who are ultra bears, notice the negative divergence that has been forming since 2008 i.e. the MACD is lagging GDX and forming a lower high.  Perhaps this will eventually play out years later with a pullback in GDP and a contraction of the US Economy!  However please realize this is a monthly chart so it may take a long time before it manifests.  I also added the 4 length length ROC indicator, the zero level appears to be important long term.

The third chart shows the new family houses sold - first off notice the negative divergence in the 2005/2006 time frame via the MACD and RSI indicators that logically ended the housing bubble as well as the bear wedge that was in place.

Also recently as base had formed with positive divergence between 2009 to 2012 which has lead to this somewhat what rebound in housing since last early last year

The 4th chart shows the Housing Starts and once again you see the same things as the Houses Sold chart, you see clear negative divergences and topping patterns at the end of the housing bubble in late 2005 that foretold the end of the housing bubble, and likewise you see some bottoming action that resulted in a bounce .

The last chart shows the Case Shiller Home Price index, as you cans see prices have recovered somewhat from the positive divergence that was in place from 2009 - early 2012, however housing prices have a LONG way to go before ever getting back to old levels from 2006.

This has been a fun exercise - I love that we are able to analyze economic data using standard technical analysis indicators which we use for trading.  I think this represents a new way to analyze economic data going forward.

 

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Market comments and education

Nice sell off today so far this morning - here's a chart that I posted yesterday to my members, as you know the market had a huge gap up yesterday but then reversed shortly after the open and sold off the rest of the day - why did the market reverse so suddenly?  Because it tagged the broken trendline of the channel and logically reversed off it.  Technical Analysis works folks!  

Also just a tip, whenever you draw trendlines, once they are broken don't discard those trendlines because they represent important support/resistance - extended them and look for a re-test of that trendline.  As you can see yesterday's gap up exactly tagged the trendline where it then reversed off for a low risk short opportunity!  When the market has a huge gap up like it did yesterday it's easy to get emotional, however keep your emotions at bay, remain objective, and use your Technical Analysis.  Today the market is down nicely and following through to the downside on yesterday's reversal

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Unemployment rate plotted with MACD

Over the weekend for fun (yes I'm a nerd I guess) I downloaded the monthly unemployment rate data from the Government Website (Fred) added it to Excel and I also added a MACD Indicator.  My thought has always been that trends in economic data can be predicted using standard Stocktrading indicators like MACD, Stochastics, RSI etc.  The unemployment rate especially because it tends to trend for long periods of time vs changing direction suddenly.

I've attached my chart and here's a quick 5 min video discussion on what I found

CLICK HERE to watch the video

As you can see simple MACD crosses work well, but also typical positive and negative divergences form on the MACD just like they do for Stocks and indexes.  I found that using my confirmation method (which I discussed in my weekend newsletter) to confirm a MACD cross really catches the trends well and filters out the divergence.  

Again this chart has nothing to do with predicting the stockmarket at this time, I'm simply showing you a little project that I did on the weekend.  I would also like to take other economic data such as Housing data, ADP etc and create similar plots.  I bet if I took housing data for the last decade that we would have seen clear negative divergence and a clear sell signal in housing prices in 2005 or 2006.

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Huge Memorial Newsletter for 2013

Hello readers!  First off I hope that you all had a nice long 3 day holiday weekend! As you know the US Markets were closed in observance of Memorial Day.

I was planning to post a bunch of charts here on the weekend, however I think it's best to simply give you my weekend market newsletter which covers everything in great deal, such as the Big Market Picture, Daily and short term views, market statistics, custom indicators and systems. Please note that I go over quite a few educational examples, therefore please pay attention because man of these are powerful techniques to use in your own trading.  Also please be aware that BPT members can get our custom BPT MA Deluxe Indicator for free!

**CLICK HERE**to view the newsletter

NYMO and NAMO Indicators with Bollinger Bands

Both of these indicators closes below their lower Bollinger Bands yesterday, which as you can see from the past has been good at identifying tradeable bottoms. 

So far the market is well off its lows today, however there is still 4 hrs left, so we'll have to see how it closes

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Our Market Newsletter and some charts

Good morning everyone, here's our comprehensive market newsletter from last night, as you know the market had a major reversal yesterday and here's our newsletter from last night

**CLICK HERE** To View the Newsletter

Otherwise this morning US Futures are down hard, ES is down -16 and Dow are down -110.  Overnight Japan's Nikkei was down over -7%, not surprisingly.

 

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Wed Afternoon market comments/update

Here's a quick update on the markets, as you know the market was up nicely earlier in the day but reversed after Bernanke's talk.

As I pointed out earlier, the SPX exactly tagged the upper trendline of the channel that we have been following, and logically pulled back from that trendline - there was also strong negative divergence in place as you can see via the MACD.  Currently the SPX has pulled all the way back to the lower trendline of the channel which is support, however will it hold?

The second chart shows a shorter term 30 min chart, this uptrend line was broken first.

The third chart shows our wave count that I discussed yesterday, with today's pullback it looks like the wave 4 has finally begun.  One initial target would be the last wave 4, which is in the 1648 - 1650 range.

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S&P 500 tagged the upper trendline of the channels

The market has been volatile today with Ben Bernanke's testimony, the SPX is off its highs, it essentially tagged the upper trendline of the channel which I discussed and showed in my posts below.  

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Silver may have put in a 5th wave bottom yestrday

Yesterday Silver had an interesting day, it was down sharply early morning then rebounded near long term support and formed a large hammer candlestick.  We have had the silver chart labeled as wave 5 pattern with the bounce in April as a 4th wave bear flag needing one more new low as wave 5, perhaps yesterday's action marked a 5th wave bottom?  Today however both silver and gold are down, though still well off yesterday's lows.

We need more evidence but my thought is that silver may have put in a 5th wave bottom yesterday.

The second chart shows a longer term chart that I've been showing for the last 3 years now.  I stated a last year and earlier this year that silver has long term support in the mid $26 area but that if it was lost, it would open the door up for silver to sell all the way down to the next long term support between 19.5 - 20.  As you can see this long term support was basically tested yesterday.

Otherwise no change in trend as of yet, the uptrend continues, let's see how this plays out over the next couple of days

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S&P 500 market comments and a video

In addition to my daily chart below, here's several intra day charts to monitor, 15 min, 30 min, 60 min charts.

**CLICK HERE** to watch a short video on these charts

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Market comments

Today the SPX closed with a Doji candlestick whcih marks an indecision point.  Tomorrow could be important, if we get a sell off it would market a bearish evening star candlestick pattern.  Today's Doji candlestick could also be considered a Bearish Gravestone Doji.  I've attached a graphic of various bearish candlestick patterns and highlight the ones which match today's action - again tomorrow is important because if we get a big down candle it would confirm a bearish evening star pattern

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Market Newsletter

Here's our newsletter which was published on Sunday night, which gives detailed charts and our thoughts on this market

**CLICK HERE** to view the newsletter

SPY 60 min system and BPT MA Deluxe comments

As you my know, I have a SPY 60 min system that I made available ONLY to members who have purchased the BPT systems (from the Tradestation Systems section).  Again just to clarify, all of you are emailed trade signals to the daily systems when the systems do a trade, in other works you don't need to have a Tradestation account to receive the email trade alerts to these systems.  HOWEVER I do NOT send out email signals to the intra day systems because of logistical problems i.e. the daily systems are not a problem because the trade signals and exits are at the close, however intra day systems like the 60 min SPY system can occur any time during the day and you can't wait around for me to send an email for that, therefore ONLY members who purchase the systems to be installed on their own computers get access to these extra systems (which can also be automated).

Anyway back to what I was going to discuss:  As you know I've been showing examples of the BPT MA Deluxe moving average indicator and how it can be useful as a trending indicator on certain settings.  Here's an example of it on the SPY 60 min system and how I am going to add it to the 60 min SPY system and other systems to hold trades for longer periods of time.  Currently the SPY 60 min system already has excellent stats of 98% winning trades and a 167 profit factor (see the stats below), however this video shows a few examples how I'm planning to add this indicator to make it better.  If this works, I'll be sharing the new code and system workspaces with you.  I also plan to test this on my 5 min ES system and the daily systems

**Click Here** to watch the video

also note: the attached system statistcs do NOT include the addition of the BPT MA Deluxe, I will show new statistics once I am able to code this

**Click here** to view the system statistics (does not include the BPT MA Deleuxe yet

Our Most Recent Newsletter

Here's our most recent newsletter that was sent to subscribers, it contains a look at the 'energizer bunny' market, some commodities, precious metals, and some trade ideas

*CLICK HERE* to view the newsletter

 

S&P 60 min chart - tagging the upper trendline

The 'Energizer Bunny' market is up again today making new highs, the 'sheep' just can't buy this market fast enough I guess!  

Anyway here's a 60 min chart of the S&P 500, as you can see it has tagged the upper trendline of this channel, this is a resistance point and aggressive traders could short that with a very tight stop.  Again the trend is very strong therefore I would consider this only for a trade and only for aggressive traders.  

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I think it's time to get the bunny out again!

With this crack fueled market, I think it's time to get the bunny out again!

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Quick Market Update

Good morning everyone, as you know the market is up once again, the masses can't seem to buy this market fast enough LOL.  Again if you listened to my newsletter last night you heard my rant/speech about playing the trend vs being an ultra bear obsessed with picking tops - eventually you will be right but you will be broke before you catch that elusive top! 

Anyway here's a couple charts from my newsletter post last night: 

First a 60 min chart of the SPX, as you know it's in a sold uptrend channel and last night I showed the small ascending triangle pattern inside the channel (drawn in black), this pattern is 12 points in height and measures to a target of 1647 (12 + 1635).  The second chart shows the 5 min bull flag chart which I also showed last night and has basically met its price target.

This move up is forming some negative divergence on the 60 min SPX chart via the MACD and RSI and is something to monitor, but otherwise the trend is strong.  

We have had tons of long ideas posted on our Paid Website

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Our most recent newsletter

Hello everyone, I hope you had a nice weekend!  Regarding the market, instead of posting a bunch of charts, here's my most recent newsletter

**CLICK HERE** to view the newsletter

Our most recent Newsletter

The market finally pulled back some today, early this week I listed the upper trendlines of the channel patterns on the daily SPX charts as a target and today the SPX perfectly tagged those resistance trendlines and reversed off them.

**CLICK HERE** to listen to our most recent newsletter on the market

 

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BPT MA deluxe moving average indicator

Here's the BPT MA deluxe MA, which is really just a fancy name for a moving average set that has tons and tons of settings.  It allows you to plot two MA's like at 20 and 50 or 50, 200 or whatever, and it also has 8 different moving average types that you can choose from (Simple, Exponential, Weighted, Triangle, Adaptive, Hull Weighted, Hull Expontial, and Hull Modified).  we can also plot just one MA and turn off the second (which is what I show in the sample charts).  It also slows the color of the slope of the MA (green when the slope is up and red when the slope is negative).

The last custom setting it has is a whipsaw factor.  You've all seen my use the BPT confirmation method where you need a second candle to confirm the first candle of an indicator change, I've shown this with various moving averages, MACD crosses, RSI above or below 50%, stochastics above or below 50%.  However I added a whipsaw confirmation method to this MA that only allows the slope to change color if it is confirmed by a second color - this turns it into more of a trending indicator.  I've attached some images below of daily and monthly S&P 500 charts.  The setting that I'm using is a 34 length exponential modified MA (our #8 MA) with the whipsaw confirmation turned on, as you can see it's done a great job at catching most of the trends.

For BPT members who have Tradestation I'm going to give you this indicator and a workspace for free so that you can play around with different settings and follow it on your own!  

Again note that even though the indicator appears to follow trend very well, I still don't like to use it on its own, I use it as a tool with other things and analysis.  For example on the monthly chart, I've found that whenever the RSI is oversold (which is a rare event on monthly charts), it's best to enter a long earlier than wanting for the MA to turn green - I've found taking the first MACD/BB green dot gets you in early (but only doing this when the monthly RSI was in a deeply oversold condition below 30%).  The first three charts show monthly S&P 500 charts while the last 2 charts show daily S&P charts, one recent and while from the past.

On the daily charts as you can see it's been green since mid November so has caught this whole move.

**Click Here** to watch a detailed video of how this indicator works and how to use it

I will be giving this indicator to all BPT members for free who have a Tradestation account.  However it's only for BPT members not free trial members (so sign up) if you want it.

Hapyy Fibonacci Day, 5/8/13

Today (5/8/13) is Fibonacci day and also my daughter Olivia's Birthday!  I tried to name her Fibonacci when she was born by my wife wouldn't let me :)

Video update on today's action in gold stocks

Here's a 7 1/2 video update I made on GDX and select individual gold/pm stocks and what I"m watching and looking for should they continue to hold up today - remember it's VERY important that they close strong, if they give up a lot of gains by the close then it's just another fake out

CLICK HERE to watch the video

SPX daily follow up

Getting closer to the upper trendline of the channel - watching for a low risk short there because a very tight stop can be employed.  Trading is NOT about certainties or being right all the time, trading is about taking low risk trades where you see an opportunity where your risk is small and the reward potential is high i.e. at least 1:3 risk/reward ratio.  If the SPX fails to stop at that trendline and you are stopped out, no big deal, that's trading, but you don't lose much because you took a short right at resistance.  

The S&P 500 is up 7.5 points today, it's getting close, let's see if it can tag it. 

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Market Update

I hope everyone had a nice weekend!  Otherwise regarding the market, there's nothing new to add at this point, the market is up slightly today - here's the daily S&P 500 chart that I'm monitoring; as you can see it's been in an uptrend channel since November.  After last Friday's big pop on the jobs report, I'm watching to see if the SPX can tag the upper trend line (or get close to it) of this channel - that's resistance and would be set up a low risk short because a tight stop could be used - i.e. short resistance when possible vs chasing oversold sell-offs.  

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SPX daily charts/comments

Here's a few S&P 500 charts, as you know the market is up huge today on the Jobs data, a fairly broad based rally (except for gold stocks remain pretty horrid).  Copper is huge HUGE today, up over 6.7%!!

Regarding the daily S&P 500 charts, one target to the upside may be the upper trendline of the channel, the second chart show an expanding triangle, again the uptrend trendline could be a target should it push higher.

The 3rd chart is our daily pivots chart for the SPX, as we have been stating, if the 1597 pivot was cleared, that would open the door for a quick push up to the next pivot at 1614 and clearly we've had that today.  The next pivot beyond 1614 is 1628.

Clearly it's tough to chase longs up there unless for short term trades.  It's Friday, I would avoid chasing any new long at this point without a pullback.

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Here are the employment numbers, positive report

Here are the employment numbers…

unemployment rate: 7.5% (was 7.6% last month)
nonfarm payrolls: +165K
private payrolls:
average workweek: down 0.2 hours to 34.4
hourly wages: up 4 cents to $23.87

February and March were revised up a combined 124K.  What stands out are the revisions to the past data, that is a positive report and the market obviously likes it!

On the news S&P futures jumped about 12 points and is testing the R2 pivot on ES, and likewise gold is down, Crude oil is up and copper is way up.  We'll how it opens and if it strengthens or weakens on the gap.  

Market Recap

Well....the market sure is resilient isn't it!  Of course it helps that all the world banks are willing to print endless money/liquidity to help fuel the markets higher, today the ECB lowered rates as expected.  Tomorrow we have the US Jobs numbers, let's see how the market reacts to those!

Today the S&P recovered all of yesterday's losses and is once again testing the 1597 highs.  Yesterday the SPY and S&P 500 indexes closed right on their 9 EMA's, when a stock or index is still above its short term 9 day EMA, the trend is still up and more follow through to the downside was needed to confirm yesterday's pullback and we didn't get it.  The 30 and 60 min bear wedge patterns that I showed yesterday morning played out to their initial targets and have now rebounded back to retest the broken trendline on these wedge patterns - this is a breakpoint, tomorrow is do or die, i.e. either reverse back down or plow through!

enjoy the rest of your day or evening,

Matt

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