Check the Thursday Stocks to Watch list our earlier post.
Today’s Action Moving Up: FSLR, MA, GS, STRA, V, CLF, ESRX, MON, PCLN, MS, MER, IBM Moving Down: AAPL, DRYS, X, BIDU, BTU, SOHU, MTL, RIMM, MOS, CF, FWLT, SCHN, AMZN, LEH, UAUA, MEE, CNX, JASO, CELG, NKE, IPI, POT Intermediate Term Market Trend: Down Short Term Market Trend: Down
Thursday, June 12, 2008
Bullish Haramis, Inverted Hammers and a Market Rally
DJIA + 57.81, +0.48%
SP500 + 4.38, +0.38%
NASDAQ Comp. + 10.34, +0.43%
Russell 2000 + 1.96, +0.27%
Oil closed at $136.74 up 36 cents
Stocks were higher from the opening bell and then traded lower from mid-day until the close and finished in positive territory for the day. The DJIA chart formed a bullish harami with an inverted hammer candle pattern.
The S&P also formed a bullish harami and inverted hammer candle pattern today.
The Nasdaq rallied to its 50 DMA before pulling back and forming a bullish harami pattern for the day. The price bar/candle had a lower high and lower low today even though it closed positive for the day. The Nasdaq closed below its January horizontal resistance and below its 50 DMA for the second straight day.
The Russell closed below it 50 DMA for the second straight day forming both an inverted hammer and bullish harami candle pattern.
Bullish haramis and potential double tops with a bearish divergence in the MACD appeared on many charts today.
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3 comments:
Dave,
Good insight. I am one of your students in the Investing Foundation Capstones sessions. In your comments today you reference an inverted hammer candle stick pattern. Can you tell me what that means? ( I can see the pattern but do not know what it means)
Thanks, Derek
Great session last night Dave. Unfortunately we missed out on some of our favorite stocks: AGU, MOS, POT because we've been so bearish and feel that stocks have a harder time rallying when the market falls so fast and hard. We did however entered a call on CLF yesterday and already enjoying a 30% return.
Question, since FSLR's bearish harami did not confirm, yet it has not made a higher high than yesterday, wouldn't we take less risk if we entered into a PUT today with a stop loss at yesterdays's high?
Thanks, Cyl & Devin
P.S. We sure have missed you on Thursdays!
Derek,
A bullish harami is a candle pattern where selling decreases significantly and buying increases. It is often a point where the short term trend reverses at least temporarily to the up side, hence "bullish" harami.
Dave
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