Download Stockcharts.com

TASUG Meeting – November/2003
Using its tools to spot
Chart Patterns, Candle Patterns,
Ratios, and Divergences.
Andy Nogueira
Part I - Stockcharts Tools
 Breadth Charts
 Market Carpet
 PerfCharts
 SharpCharts
 StockScans
Home Page
Part II – Using Stockcharts to spot

Candlestick Patterns
• Bullish / Bearish

Divergences
• Positive / Negative

Chart Patterns
•

Reversal / Continuation
Ratios
•
Intermarket Analysis
Breadth Charts
Shows Market Breadth for
• NYSE
• Advancing / Declining
• Highs / Lows
• NASDAQ
• Advancing / Declining
• Highs / Lows
• AMEX
• Advancing / Declining
• Highs / Lows
Page 1
Page 2
Market Carpet

Lets you see at a glance
what the entire market is
doing as well as the sectors
and companies within the
market.

Available Predefined Carpets
•
•
•
•
•
S&P Sector Carpet
Market Summary Carpet
Fidelity Fund Carpet
Rydex Fund Carpet
Toronto Stock Exchange
Perfcharts Carpet

Lets you compare two or
more different stocks,
indices, or mutual funds
during a period of time.

Display price performance
lines for up to 10 different
financial datasets

Line Graph or Histogram
(Total Return)
Line Graph
Histogram
Sharpcharts

Create bar charts, line charts
and candlestick charts for more
than 20,000 stocks, indices,
and mutual funds.

Intraday, daily, weekly and
monthly charts in a variety of
sizes and color schemes

Create lists of annotated charts
Annotated Charts
Stock Scans
Page

Create your own scans to
find stocks in the database
that meet certain technical
conditions and criteria

Predefined Scans:
•
Technical Indicators
•
Candlestick Patterns
•
P&F Alerts
Candlestick Patterns

Bullish Patterns
•
•
•

Morning Star
Bullish Abandon Baby
Bullish Engulfing
Bearish Patterns
•
•
Evening Star
Dark Cloud Cover
Candlestick Formation
UP
DOWN
Morning Star
•
A downtrend is under way
• First day is a long black day
• Second day gaps below the
1st day's close
• Third day is a long white day.
Morning Star
Bullish Abandon Baby
• A downtrend is under way
• First day is a black day.
• Second day is a doji
whose shadows gaps
below the 1st day's close.
• Third day is a white day
with no overlapping
shadows.
Bullish Abandon Baby
Bullish Engulfing
• The color of the first day's
body reflects the trend.
• The second real body should
have the opposite color of the
first real body.
• The second day's real body
totally engulfs the first day's
body.
Bullish Engulfing
Evening Star (Bearish)
• First day is a long white day.
• Second day gaps above the
first day's close.
• Third day is a long black day.
Evening Star (Bearish)
Dark Cloud Cover (Bearish)
• First day is a long white day
• Second day is black with an
open above the high of the
previous day
• Second day closes within but
below the midpoint of the first
day’s body
Dark Cloud Cover (Bearish)
Divergences
A divergence occurs when the trend of a
security's price doesn't agree with the trend
of an indicator.
•
Positive Divergence
•
•
Occurs when the indicator
moves higher at the same time
the stock price is declining.
Negative divergence
•
Occurs when the indicator
moves lower as the stock price
continues to rise.
Chart Patterns

Reversal Patterns
• Head and Shoulders
• Double Top (Bottom)

Continuation Patterns
•
Flag
Head & Shoulders

Consists of a peak followed
by a higher peak and then a
lower peak with a break below
the neckline.

Volume Confirmation
•
•
•
•
First peak - High volume
Middle peak - Moderate
volume
Third peak - Low
volume
A sharp increase in
volume on the break
below the neckline
Double Top
• Made up of two consecutive
Double Top
peaks that are roughly equal,
with a moderate trough in
between
• Volume contracts on second
peak as a further indication of
weakening demand.
• Support must be broken in a
convincing manner, and
usually with an expansion of
volume
Flags (Continuation)
• Mark a small consolidation
before the previous move
resumes.
• Volume confirmation:
• Expands to form the flagpole
• Contracts during the flag's
formation
• Expands after the resistance
breakout.
• Usually the price target is
the length of the flagpole
Ratios

Intermarket Analysis
•
Intermarket Technical Analysis is the
study of the relationships between the
four major financial markets: Stocks,
Bonds, Commodities and Currencies.
•
30 Year US Bond / S&P 500
US$ Dollar / Gold
•
Links and Suggested Reading
 Links
• Stockcharts.com
• Prophet.net
• Hotcandlestick.com
• Equis.com
• Leavittbrothers.com
• Chartpatterns.com
 Suggested Reading
• Japanese Candlestick Charting Techniques - Steven Nison
• Beyond Candlesticks - Steven Nison
• Technical Analysis of Stock Trends - Robert Edwards & John Magee
• Encyclopedia of Chart Patterns - Thomas N. Bulkowski
 Andy Nogueira – [email protected]