Sunday Update for Week of 9/17 – Introducing Lower Indicators

A prepared trader is a profitable trader, and Sunday is a great day to get ready for the week ahead by studying up from last week’s price action. This weekend, we are focusing on SPY and social media stocks with new features just introduced on Wednesday; lower indicators and new background colors! For a full introduction and explanation of lower indicators and chart thems, please check out the two following links:

As the tech market has taken a hit since the beginning of July, it looks as if things could be turning around due to the lower indicator action we have found.

Ticker #1: SPY

Short-term technical setup: Daily candle

  • The ascending wedge continues to get tighter and tighter as the price nears either a breakout or breakdown from this pattern.
  • The RSI and Williams % Range are both overbought currently which suggests this could pullback if volume picks up on the sell side.

Long-term technical setup: Weekly candle

  • The weekly candle continues to trade in a very strong upward sloping channel with the SMA (20) below as resistance.
  • The weekly candle shows a possible breakout to new highs which would coincide with $300 on the red trendline above which was previously major resistance on the last move up into 2015’s correction.

Ticker #2: TWTR

Short-term technical setup: Daily candle

  • Twitter continues to trade in a head and shoulders formation on the long-term chart with a very high price to earnings ration around 100 or so.
  • The price continues to find support right at the intersection of the yellow and black support trendlines below the current price.
  • Notice both the RSI and the Williams % Range are both very oversold. The last time this happened, over a 10% move followed.

Long-term technical setup: Weekly candle

  • The weekly candle shows the price barely broke down through the support line but this could easily be to try and knock technical traders out before moving it higher.
  • The doji right on the long-term support trendline with the RSI and Williams %R oversold conditions suggest this could be nearing a bottom.

Ticker #3: FB

Short-term technical setup: Daily candle

  • Facebook had a strong day on Friday with price bouncing right off the black support lines that have acted as both support and resistance in the past.
  • If the price bounces here, watch for a possible breakout to the SMA (20) above and if that doesn’t hold, a test of the purple trendline above that.

Long-term technical setup: Weekly candle

  • Similar to Twitter, Facebook is VERY oversold on the RSI and Williams %R with price trading right on longer-term support here.
  • If a bounce does begin, watch for a test of the SMA (20) above as the first area of resistance.

Check out a couple of these backtests we have been able to capture so far!

Backtesting is essentially the ability to find repeating patterns that have occurred in the past and are now showing up once again. As backtesting can take time, we have attached a few examples of backtested charts with timestamps while other backtests are still materializing into next week.

NFLX: Before

NFLX: After

MSFT: Before

MSFT: After

 

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REMEMBER: These are charts that have interesting technical setups based on automated technical indicator analysis included. Charts and analysis provided for educational reasons only. TRENDSPIDER IS A CHART ANALYSIS PLATFORM. IT IS NOT INTENDED TO BE TRADING OR INVESTING ADVICE. ALWAYS DO YOUR OWN DUE DILIGENCE USING MULTIPLE SOURCES OF INFORMATION AND/OR SEEK THE ADVICE OF A LICENSED PROFESSIONAL BEFORE TRADING OR INVESTING. Please read our full risk disclaimer on our website by clicking here.