Please allow me to introduce myself. My name is Sean McLaughlin and I’ve been involved in financial markets as a Trader, Exchange Member, blogger, in building social communities, podcasting, training and in sales for 20 years.
Some of you may already know me or have engaged with me on Twitter, Medium, or StockTwits where I go by the handle @chicagosean. Others may know me from the 7 years I spent as Director of Community at StockTwits, and a few more may know me in my role of Sales, Training, & Strategy at Trade Ideas, LLC.
Wherever you may or may not know me from, I’m happy to be teaming up with my friend JC Parets at Allstarcharts.com to build upon his excellent and unparalleled work in providing actionable insights to the financial community.
I've been looking forward to this day all year. All Star Options is now live - Go check it out!
Over the years we've built a customer base of smart, well informed and eager to learn investors from all over the world. Active Traders, Hedge Funds, Banks, Financial Advisors and many others come to Allstarcharts for unbiased technical analysis research with invariable consistency. We service most of the largest and most powerful financial institutions on earth, but the price point is also approachable for investors trading their own accounts.
When I go through all of the crypto currencies, the healthiest one and the only one already pressing up against key resistance is Ethereum. You guys know I look for relative strength and positive momentum. Ethereum is showing characteristics of both right now.
Today I want to take a look at what we're seeing in Ether, as the great Nasir Jones would refer to it. He's one of our generations greatest poets and I think what we're seeing in the Ether right now is pure poetry.
When I go through charts of the most popular crypto currencies, it's hard to ignore the fact that we're seeing prices breaking out above downtrend lines from their respective highs. Go one by one, we're seeing it all over.
So what does that mean? Should we be buying all the crypto currencies right now?
Since the market's volatility picked up in late January, one key piece of the bear thesis has been weakness in Technology, yet we've not seen a crack and flush lower. I don't know about you, but I was promised a "Tech Wreck" and will not leave until we get one or Mr. Market provides me a refund.
Okay I'm being facetious, but in this post I want to outline what I'm watching and explore what the implications are if the potential bearish patterns in this sector don't pan out.
Many have fixated their attention on the "triangle pattern" that's formed the NYSE Composite Index and other major US indices. This pattern is a visual representation of the indecision between buyers and sellers in the market, and its resolution typically leads to a significant move in the direction of its breakout. In times like this where the index itself has little directional conviction, a study of the components may offer some insight into which way the market resolves.
It's impossible for me to ignore. As someone who pays such close attention to Momentum, the fact that there are so few stocks showing bearish momentum characteristics is absurd. The overwhelming strength being shown here from stocks is spectacularly bullish in my opinion. Combine that with the fact that everyone thinks the world is coming to end, and boom, you've got a trade!
Until proven otherwise, it is irresponsible to be positioning for a bear market right now. The talking heads and twitterverse all seem to be rooting for -- cheering for, even -- the S&P 500 to break it's 200-day moving average and crash further from there.
It's ok to root for any scenario you'd like, but it's simply unprofitable to act on opinions (yours or others) until there is a basis of fact to back you up. And the only facts we focus on here are those presented and derived by price and volume.
The weight of the evidence still points to higher prices in equities over the intermediate term, and as such we're hunting for bullish trades. Today's hunt yielded a developing opportunity in Caterpillar $CAT.
It's no secret that JC and I are extremely bullish on stocks. Just like you'd like to see in a bullish environment, we're being led higher by tech stocks. And there's no better barometer of health in the tech sector than seeing old bellweather Microsoft still hanging around new all-time highs and cruising comfortably above it's 200 day moving average.
Three weeks ago I had the pleasure of attending the CMT Association’s 45th Annual Symposium in the Financial District of New York City. In prior years I’ve lived vicariously through previous attendees’ tweets and blog posts, so this year I was equally nervous and excited when I decided to attend in person for the first time.
This year’s theme was “Navigating the Gap: Forces That Influence Price Dynamics”, which suggests that there’s a “gap” between the market price of securities and their intrinsic value and that technical analysis can help in navigating that gap by providing a way to analyze market behavior and the law of supply and demand. As market practitioners we know that markets are not efficient, which is why we all do the work that we do.
I think seasonality is often misused. Although economic cycles, political climates and public markets are constantly changing, the behavior patterns of humans remain the same. I spend a lot of time studying cognitive behavior and markets and it is very clear how foolish humans can be, including the robots they build. We behave in specific ways during some parts of the year and completely different in others. Those cycles play a role in annual cycles.
One of the most popular, and misunderstood, is the old "Sell in May and Go Away". But what exactly does that mean? Should we blindly enter the month of May with a bearish selling strategy? Does that sound like a good idea? Historically stocks are up for the month of May about half the time and since 1950 the S&P and Dow average a 0% return. June has a similar history of 0% average returns and positive return close to half the time. But that's not really what we're interested in here, which is my point.
I just got back from a week in New York City and here's what I see: The winners keep winning, the losers keep losing, things keep getting better and people think they're getting worse. I like that combination.
When I was 18 years old I moved to the New York area and spent a total of 15 years out there, most of which was in the financial space surrounded by entrepreneurs, traders, investors, analysts, fintech, traditional media and the biggest names in financial social media.
For the past 3 year's I've lived in beautiful Sonoma Valley, CA in what some might describe as something of a bubble. I don't watch financial television. I'm not ‘in the know’ about the daily gossip except for what I see on twitter. And even then, I don't consume nearly as much of it as most people. I'm not at the Hunt & Fish club once a week, I don't attend every book party in New York and I'm not surrounded by financial journalists every day. I'm out.
