ATVI: Rounded Bottom with Dark Pools WaitingActivision Blizzard Co is developing what will become an intermediate-term rounded bottom formation, aka bowl bottom. It is about 25% to completion. Large-lot indicators have not formed a shift of sentiment pattern yet, as smaller funds’ VWAP orders continue to trigger in capitulation mode. The smaller funds are giving up on ATVI as it bottoms. The Dark Pools will wait to see if the stock will drop further due to the smaller funds dumping before they decide where to set their TWAP orders. ATVI is a gaming company that is gearing up for Augmented Reality.
Darkpools
Small Cap Stock to Watch: NSTG with Dark Pools, Pro TradersNSTG had a speculative momentum run out of a short term bottom. This small-cap stock has finally broken out of its long term trading range to a new high. Now it needs to shift sideways to avert a falling stock price. There is some mild accumulation in the consolidation patterns that are representative of one or two Dark Pool giants and some pro traders who both stabilize and control price to a neat and tidy-looking consolidation.
NSTG is not a buy at the moment as the run is overextended at this point, but it is worth considering for a possible watchlist candidate since it is in Nano technology, which is finally forging ahead again with more products moving to the market acceptance phase.
KO Earnings: Dark Pool Rotation vs. BuybacksCoca Cola has been in a major buyback mode for its stock in an attempt to move the price up. The buybacks have faced heavier than normal Dark Pool rotation (large lot selling) against the automated buyback orders. Recently the buybacks have increased, creating some interesting anomalies in the large lot indicators as well as in price patterns. Retail traders, who trade this stock heavily, are often fooled by buyback candlestick patterns. Institutional holdings has declined, which is unusual during a buyback mode.
AKAM: Dark Pools & Pro Traders Patterns Ahead of Earnings TodayAkamai Technologies Inc. reports earnings today with a solid start to a bottoming formation with Dark Pools' and then Pro traders’ footprints. The stock is currently at a completion level for the short term bottom. A Shift of Sentiment™ pattern formed between October and January. AKAM moved lower before finding the final low support from a previous Dark Pool Buy zone while Accumulation/Distribution indicators exposed the positive divergence. The pattern is a setup for a swing trade, not a position trade opportunity yet.
UTX: Pros Set Up for Earnings Today While Dark Pools RotateUnited Technologies Corp Weekly Chart removes the white noise of the daily candlestick patterns, revealing a cleaner perspective of who controls price for this stock. UTX is bouncing up after hitting support levels AND with professional traders setting up for earnings news. The precision trading of the professionals is not impacted by the slow hidden rotation pattern revealed by the Accumulation/Distribution indicator on the weekly scale. As the stock price rose, large-lot Dark Pools sold (rotation), hiding their activity. The rotation is not about this report; those buying and selling adjustments occurred in November and December. This rotation is about the first quarter earnings report for 2019, which will come out in April. Dark Pools make decisions 1-3 months ahead of the earnings reports. Today UTX is reporting last year’s results, ancient history for the Dark Pools. The pro traders are gearing up for HFT action on this high-profile stock.
LRCX: Dark Pool & Professional Trader Patterns Ahead of EarningsLRCX has an important technical pattern. The stock chart is technically precise. Lines drawn on a weekly chart match perfectly to daily support levels. This is not always the case. The technical precision of certain areas of this chart shows where the professionals have entered and exited. The ability to see the footprints of Dark Pools and Professional Traders is what I have termed Spatial Pattern Recognition Skills for Traders™. This technical analysis skill makes a huge difference in your end-of-year profitability from trading stocks whether you day, swing, position, momentum or intermediate-term trade.
AAPL Technical Pattern: Dark Pool Rotation AFTER Earnings SeasonOne of many things I strive to teach my students is to watch what happens to a stock immediately AFTER an earnings season. This is the telltale activity of the Dark Pools who prepare for the next earnings season weeks ahead of those reports. So when AAPL started showing signs of large-lot rotation in September and into December, that was your cue that this big bellwether had slammed into a Market Saturation Phase hard, very hard.
CEO Tim Cook warned this morning that quarter 4 of 2018 is going to have significantly lower revenues. AAPL has been making minor enhancements to its iPhone for years and running on fumes without any new exciting products coming through. And NO, the Augmented Reality it has hurriedly rushed to promote is not true AR and will not likely help the Market Decline Phase. It could take a long time to recover with no new technology emerging from this company for this year or longer.
SBUX: Shift of Sentiment Pattern Leads Gap Up to PlatformSBUX has now confirmed the gap gains by holding well above the trading range highs. This provides very strong support for the stock to continue moving upward. This daily chart of the stock shows a Shift of Sentiment™ Pattern with the Accumulation/Distribution indicator. The shifting pattern begins with the common gap down by HFTs in June and then the VWAP automated selling by the smaller funds to the final low. Then, the stock moves in a typical Dark Pool Pattern out of the low. Pro traders and HFTs gap the stock up in November on earnings news. Another platform is developing now above that gap which establishes more support at this level.
AMZN: Topping Formation Incomplete with VolatilityAMZN has a topping formation which is incomplete at this time. Incomplete means that the stock has not broken through the strong nearby, short term technical support level YET. It may or may not. The stock can always shift sideways as BA did, as an example, to pattern out the excessive stock price uptrend created by speculation. Trading range corrections, as opposed to down-trending corrections, take much longer because the stock price remains well above the company’s fundamental value. The financials have to catch up to the price per share. For AMZN, there is also rotation, aka lowering of stock shares held by the Giant Dark Pools, evident in studying the price trend against the Accumulation/Distribution indicator. This increases the risk of sudden downside action. For now, buybacks and smaller funds buying on a dip are holding the stock up. Watch for increased volatility as a precursor to more downside action.
CRM: Risk for Topping Due to RotationSalesforce.com has had a great run up from the 2015-2016 correction. CRM stock is now showing an extreme Angle of Ascent on the weekly chart and has risk of a potential topping action. Support is weak at the bounce area at this time. The stock shows steady rotation patterns as the final peak high developed. Rotation is the lowering of inventories of a stock by Dark Pools.
NVDA: Earnings Stock of the DayThis big technology stock reports its earnings today AFTER the market closes. Sometimes the after-market reports are not great reports. On the weekly chart, NVDA shows one of the new tops taught in TechniTrader’s Definitive Guide to Market Corrections course. This is a Sheer Cliff top which is a sudden collapse of price after a trading-range sideways pattern of several months. The decline has been very steep and fast. It is resting at weak support. You can see from Accum/Dist that this stock has been in heavy rotation mode by the Dark Pools since 2017. The stock moved up on buybacks and speculation by smaller lots against the heavy rotation by the Dark Pools.
HD: Earnings Stock of the DayAlways a late reporting company, HD reported today before the market opened. HFTs were ready to gap the stock in the direction the algos perceived earnings. The chart patterns were setting up for a negative reaction. The stock is in the lower area of its trading range that has similarities to the S&P500 index chart's trading range pattern. Flow of Funds indicators show heavier than normal outflow of money from this stock. That means selling is rotation or distribution by Dark Pools.
Earnings Stock of the Day: ROKUI started monitoring this stock shortly after it IPO’d as it appeared frequently on the large lot pre market activity list as Dark Pools accumulated this IPO early on. Roku Inc. is in the Communications Services Sector under the Pay TV Industry. It is a new young public company challenging companies like NFLX with a new form of streaming video content for consumers. ROKU reports its earnings today after the market closes. It's stock chart shows it is now in the typical and expected IPO correction pattern. ROKU weekly chart shows it is finding support from the IPO correction that started late December of 2017.
PFG: Dark Pool Footprints Show Accumulation in a BottomAs a new generation starts families and buys homes, the growth in Life Insurance also booms. There are several life insurance companies forming bottoms right now and many are nearing completion for future position trading, intermediate term holds or even long term holds.
This chart has a specific footprint in the chart patterns that confirms the bottom has begun with accumulation from the Dark Pools. The bottom completion should be confirmed before entry for position-style to longer-term as it could easily retest its lows several more times while you are holding in the red waiting for the move up. Always, buy into strength.
The Gottcha ADBE TrendThe ADBE Trend is one that is often a “gottcha” for new swing traders. The problem is trading leadership. The runs are not initiated by Dark Pools or Pro Traders. The runs are initiated by smaller funds using VWAP or, worse, the retail crowd. The retail crowd is more emotional, has less experience and minimal training. Therefore, the runs they create are harder to trade. Try to avoid trading stocks that lack strong runs. Strive to trade with the Pro Traders, as the follow-through of the run is more reliable and the profits are usually much higher. This is not the ideal stock for swing trading at this time.
Martha Stokes, CMT