The StockTwits Charts Stream gets filled daily with thousands of stock charts created by the largest real-time trading community in the world. Below are a few notable ones for your perusal:
A few warning signs are beginning to creep into the market here and often they turn up first by looking carefully at price behavior.
1. Deteriorating Market Breadth – Andrew Thrasher, an investment analyst at the Financial Enhancement Group, posted the following chart to StockTwits showing the percentage of stocks above their 200-day moving average continues to decrease even as the S&P 500 (SPY) makes new highs.
This divergence between the index and the long term strength of its components provides a clue that beneath the surface, things are deteriorating. Look for SPY price to confirm.
2. International Business Machines (IBM) - Kimble Charting Solutions’ Chris Kimble posted this next one showing IBM at a critical support level. Chris points out that IBM may be in the midst of forming a rounded topping pattern on a long term chart and so a price break of the support would be big.
IBM is a true bellwether and has been a leader for the majority of this four year bull market so if it is beginning to break down, this might serve as a tell for big cap tech and the broader market as a whole.
3. Goldman Sachs (GS) – Goldman Sachs failed to hold its breakout level of $167 that was mentioned yesterday. Serge Berger, Head Trader at Blue Oak Advisors, calls this failed breakout a ‘fake-out breakout’.
Failed moves often lead to fast moves in the opposite direction and Goldman, like IBM, is a bellwether and a leader in the financials.