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CHART PATTERNS SECTORS MARKET UPDATE Oversold Bounce For Sideways NASDAQ The Greenback Semiconductors Channels Higher TrTradersaders MARCH/APRIL 2007 US$7.95 .com THE MAGAZINE FOR INSTITUTIONAL AND PROFESSIONAL TRADERS TM TRADING THE MACD+H reserved. Adding the histogram 10 rights THE DOW’S All MOMENT OF TRUTH Inc. Near the make-or-break point 14 THE NIKKEI BREAKDOWN Analysis, The decline continues 18 WHEN COPPER CRACKS The breakout has arrived 20 Technical © BLACK GOLD IS BACK Toward a seasonal sweet spot 22 2007 LOWERING RATES? Favoring the possibility 33 Copyrights BANKING BREAKOUT Breaking to new highs 37 WILL TRANSPORTS… SEMICONDUCTORS, WEEKLY AND DAILY Take a hike? 38 REMEMBER VOLATILITY? Watch for resistance 42 GE FALTERS A support break coming? 45 Traders.com 4757 California Ave. SW Seattle, WA 98116-4499 Change service requested page 2 • Traders reserved. .com rights All Inc. Analysis, For moreinformation, visittheS&Cadindexat Technical © 2007 Traders.com/reader Copyrights March/April 2007 March/April 2007 Traders.com • page 3 TRADE AT THE BIG KIDS’ reserved. rights TABLE. All ® Inc. E traordinary ® ® Analysis, POWER E*TRADE PRO FOR ACTIVE TRADERS. Technical $6.99-$9.99 © per stock and 5.05 % APY 2007 options trade New Complete Savings Account2 75¢ offered by E*TRADE Bank per options contract1 Copyrights Get started with 100 (800) 731-5226 commission-free trades3 getpoweretrade.com Click Call Visit For details and important information about Power E*TRADE, please visit getpoweretrade.com. 1. To qualify for $6.99 stock and options commissions & a 75¢ fee per options contract, you must execute 500 or more stock or options trades per month. To qualify for $9.99 stock and options commissions & a 75¢ fee per options contract, you must execute 10 – 49 stock or options trades per month or maintain a balance of $50,000 or more in combined E*TRADE accounts during a calendar quarter. Qualifi cation will be determined at the end of each quarter. To continue receiving these commission rates, you must requalify by maintaining a balance of $50,000 or more in combined E*TRADE accounts or by making at least 30 stock or options trades by the end of the following calendar quarter. 2. The Complete Savings Account is offered by E*TRADE Bank. Annual Percentage Yield is effective 12/05/06 and is subject to change. A $1 minimum deposit is required to open a new account. Withdrawal limits apply. Online statements required. 3. Commission-free trade offer applies to new Power E*TRADE accounts opened with $1,000 minimum deposit. The new account holder will receive a maximum of 100 free trade commissions for each stock or options trade executed within 30 days of the opening of the new qualifi ed account. You will pay the Power E*TRADE commission rate at the time of the trades ($9.99 for stock and options trades—plus an additional 75¢ per options contract). Your account will be credited $9.99 per stock or options trade within eight weeks of qualifying (excluding options contract fees). Other commission rates apply to customers who trade less than 30 times a quarter or maintain less than $50,000 in linked E*TRADE accounts. Account must be opened by December 31, 2007. Securities products and services offered by E*TRADE Securities LLC, Member NASD/SIPC, are not insured by the FDIC, are not guaranteed deposits or obligations of E*TRADE Bank, and are subject to investment risk, including possible loss of the principal invested. Banking and lending products and services are offered by E*TRADE Bank, a Federal savings bank, Member FDIC, or its subsidiaries. Bank deposits are FDIC insured up to $100,000. E*TRADE Securities LLC and E*TRADE Bank are separate but affi liated companies. System response and account access times may vary due to a variety of factors, including trading volumes, market conditions, system performance, and other factors. © 2007 E*TRADE FINANCIAL Corp. All rights reserved. For more information, visit the S&C ad index at Traders.com/reader page 4 • Traders.comTrTradersaders March/April 2007 .com THE MAGAZINE FOR INSTITUTIONAL AND PROFESSIONAL TRADERS TM TABLE OF CONTENTS MARCH/APRIL 2007 • VOLUME 5 NUMBER 2 METALS AND ENERGY 20 Copper Cracks 10 Trading The MACD Histogram, Part I by David Penn by David Penn The much-anticipated breakout from a multimonth As good as the moving average convergence/divergence is, symmetrical triangle has arrived. adding the histogram might make it even better. reserved. 21 Flag Breakout For XAU INDEXES by Arthur Hill 14 Short-Term Moment Of Truth For The Dow Despite the potential for a massive head & rights by Arthur Hill shoulders reversal pattern, the Philadelphia All The Dow Jones Industrial Average has corrected over the last Gold & Silver Index recently broke flag resistance, pointing to higher prices. three days, and this correction is nearing its make-or-break Inc. point. 22 Halliburton Takes A Rest 14 Short-Term QQQQ Sell? by Arthur Hill by David Penn After a big surge on high volume, Halliburton took a breather over the last two weeks. Traders should look for a breakout to What happens when long-term bulls become short-term bears? Analysis, signal a continuation higher. 16 NASDAQ Channels Higher 22 Black Gold Is Back by Arthur Hill by David Penn Despite a warning shot from the stochastic oscillator, the Breakouts in oil stocks appear as the group moves toward a NASDAQ remains in a rising channel and the trend has yet to Technical bend. seasonal sweet spot. © 16 Meeting Parameters On The S&P 500 24 The Gold Bugs Index Hits Support by Arthur Hill by Jacob Singer, PhC 2007 Every morning I look for certain stocks to buy, but they have The December decline in the Amex Gold Bugs Index hit to meet certain parameters. What does it mean if for the past support and recent firmness could foreshadow a break higher. three days, not a single stock has come up that meets those parameters? 25 Gold’s Three Trends by David Penn Bullish long-term, bearish intermediate term ... what does a 18 Nikkei Breaking Down Copyrights by Arthur Hill near-term breakout mean for gold going forward? The Nikkei 225 is breaking down on a number of fronts, and this points to a continuation of the April–June decline. 28 Crackin’ Crude by David Penn 18 NASDAQ Composite Index Shows Pending Negative divergences in the MACD histogram and stochastic Downleg anticipated the reversal in oil stocks. by Gary Grosschadl Has the Grinch stolen the Christmas rally, or is it already over CHART PATTERNS for the NASDAQ? 29 The S&P 500’s Cup With Handle by David Penn 19 The NASDAQ 100 Winds Up For The Pitch A classic chart pattern suggests more upside for the S&P 500 by Arthur Hill as the holiday season begins. A narrowing consolidation can’t last forever, and the NASDAQ 100 looks poised to break the recent trading range. 30 The Falling Three Method Here’s what to look for. by Paolo Pezzutti This candlestick pattern, which is quite rare and usually reliable, has provided some wrong signals lately. Copyright © 2006 Technical Analysis, Inc. All rights reserved. Information in this publication must not be stored or reproduced in any form without written permission from the publisher. Traders.com™ is published by Technical Analysis, Inc., 4757 California Ave. S.W., Seattle, WA 98116-4499. 1 206 938-0570 or 1 800 832-4642. Printed in the U.S.A. March/April 2007 reserved. rights All Inc. Analysis, For moreinformation visittheadindexat Technical © 2007 Traders.com/reader Copyrights Traders .com • page5 page 6 • Traders.comTrTradersaders March/April 2007 .com THE MAGAZINE FOR INSTITUTIONAL AND PROFESSIONAL TRADERS TM TABLE OF CONTENTS CHART PATTERNS 39 Small Caps Show Relative Weakness 32 by Arthur Hill A Cup With Handle For Treasury Notes The S&P Small-Cap iShares has been underperforming the by David Penn S&P 500 this month, and a bearish candlestick reversal points A classic chart pattern suggests bullish times for bonds. to more weakness. 33 Long-Term Rates Trending Lower by Arthur Hill TECHNICAL INDICATORS reserved. The 10-year Treasury note yield found support over the last 41 A Tick Indicator Overview two months but remains short of a reversal, and the odds favor by Paolo Pezzutti a move lower for interest rates. The tick is a valuable tool, especially when utilized in a very rights short time frame, as it is quite effective at measuring market All 34 A Head & Shoulders Top In Retail? breadth. It is popular among daytraders and scalpers, as it can by David Penn help assess the strength of market moves. An autumn consolidation in the retail HOLDRS hints at the Inc. possibility of a move lower for retail stocks. 42 Remember The Volatility Index? by Arthur Hill 35 An Oversold Bounce For The Greenback The NASDAQ 100 Volatility Index has been slowly building a by Arthur Hill base, and traders should watch for a resistance breakout to The US Dollar Index shows signs of firming and looks ripe for solidify a trend change. Analysis, an oversold bounce. However, the bigger trend is down—will resistance be around? 42 Dollar Divergences: Up And Down by David Penn SECTORS Negative divergences took the dollar down in October. Will positive divergences bring Technical 36 Sideways Semiconductors the dollar back up a year later? © by David Penn Waiting for signs of directionality as the semiconductor 44 eBay Tests Overhead Resistance HOLDRS works its way through a potential 1-2-3 trend by Gary Grosschadl 2007 reversal setup. eBay has come off a summer bottom for a nice gain, but what’s it got in store now? 37 Internet HOLDRS Reaches Resistance by Arthur Hill 45 GE Starts To Falter The Internet HOLDRS rebounded sharply over the last four by Arthur Hill months, but the rally is running into resistance and the GE has underperformed the S&P 500 since mid-October, and Copyrights exchange traded fund is still lagging the NASDAQ.
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