 is a presentation of TFNN the Tiger technician hour with your host Basil Chapman call now toll-free at 1-877-927-6648 hi everyone Basil Chapman on this Tuesday Tuesday the was it's 14th of September we're looking at the dial down 85 points and 34,784 the pattern that we've been discussing we'll show you right here the dreaded age pattern we haven't yet taken out on a second time basis the 34,599 level that was made on three days ago and 34,690 was the low around about the August 19th then there was this huge pop to the 35,510 level and all of a sudden it turned around and a peak B became a peak B minus because it failed and this is the pattern that we look at in the dreaded age we haven't yet confirmed so this is let me just explain the left side low when you come down the straight line like here it is at 34,690 when you arch over if you take out that left side low you have two bars in which to close above well this is the second day and we are closed above yesterday we're going to be watching this level very closely it's the level on the left 34,690 we're at 34,790 we're 100 points above that if we take out this one level here that says whoops you're now very vulnerable to taking out the 34,598 that's why we call it the dreaded age because once you start that cycle of arching over you can keep going down and that's going to be what we're watching in terms of the Dow itself but all the look at this all the indices are a different pattern look you've got an arch formation here you've got the S&P which had a choice of breaking out above the Chapman falling arch formation oh let me explain that which implies that you make a high and then you start to come down you're making lower highs and much lower lows then all of a sudden the pattern says up finding a base if it takes out that trend line that upper trend line you can go one to one to the upside and even retest and break the left side high so the falling actually looks like an axe because there's the there's the so you've got your strong handle you've got the lower high and then you've got a much lower low that's the expanding wedge formation so when you take that out it's really important well there's also a technique that I call called the inside track we just below that I'll have a little mini channel and that becomes the repellent zone we got there a few times in the S&P and then broke down and now we're testing the lower trend line in fact we've broken it a couple of times and now we've got at a lower point and that makes the 44 45.70 low really important that we're at 44.62 right now so those of you who are thinking that oh this is another little one of those by the dip moments I believe the tide is turned at least in the short term all the daily charts not the weekly we have to wait until Friday before we can talk about the weekly charts but the daily tide has said we are now going towards a low tide not a high tide that's my impression could be completely wrong certainly a break into the 45 tens would be a really good action I just don't see what's going to do that right now so the S&P's down 5 at 44.63 the QQQ and I mentioned question came up how on earth what techniques would you use to short the best index of all but I'm using the Chapman-Weig methodology in this particular technique we're always looking for the fourth highest peak to start to consider whether or not there's going to be a failure because the technicals are fading well it was really just the Chapman-Weig notation and the little doji candle that night on the 7th of September 382.78 that suggested quite strongly that in the Chapman-Weig methodology we try to identify the lowest low and then count each successively higher peak alphabetizing them all the way from A to B to C to D E F and G but it's at that fourth highest peak labeled peak D that other things can happen we've seen that happen we saw that February peak D back last year in the Dow that just was created tumult in the market so here we are peak D in the QQQs and as I say we shorted it quite a few days ago last week and it's at 376.44 it's up 10 cents today starting to act poorly but it's the MACD that's weak the stochastic that's weak the on balance that's weak the rental strength is okay in the daily chart but until we get a crossover a negative crossover the 9 period moving average going below the 14 period moving average any cell mode that we have which is it's in right now is ephemeral because we've got to wait quite a bit it would take a 372 level to really see that green cross under the 14 period moving average so that's going to be very important so yes we short the dialysis we short the QQs but what's really important is that if you're looking at the sectors that have been important and the patterns the pattern that I talk about the lowercase h that can go to a lowercase m and stay in a rectangle formation in the IWM the Russell 2000 that's continuing it is no there's no change we're into the upper band now we're pulling back peak c1 c2 in the monthly chart question came in about the SMHs well the SMHs we haven't done anything yet with the SMHs I'm real close the high on today's Tuesday Friday the high on Friday was 276.04 a bit of a dip on Monday today a rally and then a pullback we down 53 cents in the 273.83 what was the high today 276.05 we got that missing peak D remember what we said in the Chapman methodology you want to go from a buy signal to a buy mode the implication is that you should go to at least a D well we've just got that D by one penny now you've got all the indices at a very important level I'm not saying it's such an important level that is the end of the world I'm saying it's an important level because I've been waiting for the for the SMHs to give some kind of a signal in the Chapman wave not necessarily in the technicals but in the in the in the in the way we assess the Chapman methodology and yeah we've got our leg D the missing leg D from the 249.35 low of around about the 19th of August and there it is today on the 14th of September less than a month later and we've got that and you've got an extension in leg I am going to keep calling this a leg F in the weekly chart I could give it an alternate account but I don't see any reason why it's the data that's important so in the semiconductors which have been what they've said before and they've said over and over and over again there's a chip shortage we've seen that how it's impacted the order order companies although GM is up today up 10 cents but that was a tremendous fall from 64 down to the 47 level and now we're looking at some kind of a countertrend bounce but I don't know whether they're faking us out or whatever it is but certainly so many companies that are involved in chips let's look at Tesla Tesla is makes a peak D the other day it's having a rally today of nine points all I can say is I it must have been very selective and all that I can think of is when Dave I heard Dave White mentioned that the order company is always too cheap to buy the chips and they paying the penalty for it so maybe it's very selective but as far as I'm concerned if the semiconductor index trading at 273.50 now down 82 cents starts to go in the next week and a half below 267 you have a problem here thousand 111 SPS online I'll be right back thank you for telling us are you looking for a way to consistently add winning trades to your portfolio Tom O'Brien is here to help Tom O'Brien has been successfully trading markets for over 30 years a frequent contributor to TD Ameritrade Network and CNBC Tom O'Brien founded TFNN over 20 years ago to help educate investors just like you Tom's daily market newsletter market insights is published every morning when the market's open to give you the competitive informational edge you need to succeed these newsletters are packed full of Tom's advanced technical analysis in our gear to deliver comprehensive strategies for a successful portfolio get Tom O'Brien's 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this big spike there was some deflationary news I don't know what it was but whatever it was at 8 30 whoosh we go from the four four six one area in the e-mini S&P futures I'm talking about the I don't I don't change my contract at all I'm some big reminder comes up but I go right to cut to the edge maybe I'll do that earlier this week we'll see so a big spike up into the 44 80s and that's a peak F and then it goes sideways remember rectangle formation lost a lot longer than your patience and that's also straight between four four eight six and four four eight oh does that for a long time goes to peak APB peak C what do we do we get a peak D right there so the second top which is a little bit lower than the high that was made of four four eight nine point 50 that is at four four it was very well four four eight six point 75 and it starts to come down real sharply goes all the way down to four four amazing five five point 50 and now we've gone sideways again in the rectangle formation but this time from below so we're gonna have to see if there's a close at any one minute bar above four hundred and four thousand four sixty I'm gonna have to say sixty seven point fifty and they can hold all the way through for three bars in other words three minutes and then create four four six one as a support actually I don't even want to see the four four six two and then have a pop into the four four seven oh so the four four seven three level the 200 period moving average any time today I'm giving it the whole day to do that I would have to say that that is good counter trend support and they can hold the market up a lot better but if in fact for whatever reason there's a sudden slide and we close on a a 10 minute basis under forty four fifty three today that's going to be a problem right now I think that we absolutely will see some kind of buy you know it is here can come down a little too long and then itchy fingers on the upside so that's this is what I'm looking at right here so it starts this pga again pga okay so it starts a leg a new leg about forty four sixty four point seventy five in the very short term but I'm going to draw this in to say remember a rectangle formation can last a lot longer than your patience we'll be looking at that over a period of many minutes let's go back to our story here so what we're looking at is within the smh's you've got that leg D is now back up to up plus 38 cents we're going to be watching this because any move into the two uh two seven six two seven eight point ninety or higher area this week would be really impressive for the estimations and say no there's still internal strength we might be looking at the tide of the overboard sectors this isn't in that category just yet now let's continue and we want to look at the um let me just do this I can't remember if I did I did during the update this is gold gold is up six now at 18 oh oh I just called it 18 oh one really important even though I've got an s showing here for the nine period moving average crossing negative this is a chapter upside down stalking formation now we're going to be watching this because if there's a move in the next few days and with the the talk of this inflation um I'm going to be watching it because if crew if gold is able to get to the 1810 area that's just the 10 11 points from here then that 200 period moving average magnet kicks in again at 1814 and we can chop around then as I said gold is in play for narrow short-term intraday trades I just don't see it having I must do this si quickly solar is um down four cents at 20374 that's telling us that chapter we're falling acts upside down pattern uh it's really struggling it has to get to 2410 to break above and if it slides under 2335 that's a problem what I was going to say is that bitcoin bitcoin is trading up 1575 at 46,390 well it made a pd uh technically I should do that I'm going to wait for the rest of the I should have a down there I'm going to put it in now because I've met all the criteria even if it rallies uh the criteria says the data is in a cell mode it could be balances but I think just for the moment I I think bitcoin has had that fantastic play going from under 30,000 remember 28,000 was my 28,800 was the the level I was looking at and support which it came to we are still long a small bit um and it went all the way to 53,125 now it's consolidating at 4629 I think this is more in play than gold at this particular point as a trading I'm only talking about trading and we're looking at uh I have to go to the dollar after that the dollar is trading down uh 14 texas 92.49 it's just within this pattern making a drainage we'll we'll see what happens it has already in the weekly chart done a whole everything we were looking at had a good rally leg then the body then the neck then the beak and now we're going to see what happens if the beak continues lower by going under 92 that's going to be a big problem it's a 92.49 right now but if it's able to get to 92.80 uh no 92.93 um that's going to be a big positive that'll that'll make legs see quite strong in the day so we're watching that closely uh TLT here we go TLT very strong move and that suggests to me because it's made a new recovery high I can now call this leg C in the day the stochastic is lagging badly the mag D is just turned positive so this is still in the early stages of a breakout above the template falling axe resistance area it's in the rectangle formation that I drew uh with an arch saying that if the arch is successful which so far it looks like it is because it's broken above the left side high um that says you can now make it cup formation and we just draw that in we're all about patterns here cups and arches here we go cup and arch there we are so that's important because the market generally will be weak either this is the way the tradition has worked for decades that when money flows from these insecurity of stocks because they becoming volatile in the parlance of wall street volatile means going down um money flows back into the safety of bonds that's all make it as simple as possible so here we are we're in in a cell mode in all the indices in the daily charts look at the IYT I was asked about would I look at that yeah generated pattern in the weekly that nine period look at this how just one moving average can keep you in a trade we haven't been in this trade but in a trade forever look since the I shares Dow Jones transportation average index fund god what a title broke down uh the week of June the 18th below the nine period moving have after average after making that uh a month earlier in May at 287.40 I should put that in 287.40 287.40 all time uh yeah all time high look what's happened peak be in the monthly but peak in the weekly look what's happened it's come down it's been repelled every single week even when it's touched it week after week the nine the black 14 period moving average and the nine crossed negative under the 14 and went pink went from green to pink and it's down again today down 238 wow I have to tell you this is a divergence I will I don't I'm not a Dow theorist theorist although for 40 or more years I've been talking about it I'm not a theorist but I always talk about it saying I like to see the transportation index confirming Dow highs because that's just it's a good sign I don't treat it as an indicator anything like that but really this is a huge divergence and it's one that's telling it as we go to the great jets which is the uh who has global jets ETF down again down to sense and get a second m shape pattern patiently m or a case m for any again I'll be back are you having fun trading the markets but having trouble finding like-minded individuals to discuss your trading and investment ideas with become an apex predator in the trading markets and join the tiger's den trading room only at tfnn.com the tiger's den is an exclusive trading room where successful traders from 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10 30 right now 30 bars and you still haven't broken out about four four six five you haven't really broken down below sharpie below four four four four five five we've been just a brief moment and look at this so isn't that interesting when you can identify patterns it makes a big difference so um i didn't finish so could you finish that could you finish your thought on the cues uh why you went short oh did i thought i did qqq uh wait before i do that i've got the chart up of apple apple made 157.26 high on the 7th of uh september showing it at 149 not a big deal what is it 148 points uh it's more it's six percent or so it's not a big deal so what we are looking at though is what is it in two hours time or something or what it's a noonish or so they're making some kind of announce i don't follow it i don't have any other apple products my wife does i don't um so whatever it is we'll see what happens but it is a peak f in the uh daily it is going to be a peak f if there's no new recovery high above 150 all-time high above 157.26 in the daily um and the monthly chart i at this particular point i could call it f slash b i just don't see any reason i've got it as an f but we don't have to be thinking about it just yet and this in fact i want to be as strict as possible in the chat wave methodology yes this could become a question came up and i forgot to answer it yesterday this could become the chat wave instant resider pd and now the price has to tell you exactly what's happened why because if there's a close on a weekly basis below 151.68 the low of the week of the 20th of august that negates that particular pattern that's all keep it as simple as possible but the weekly chart flat 87 percent stochastic on balance volume has pulled back a little bit after being overboard magnae is still positive nine is way above the 14 i'm telling you now the weekly charts in most most instances and the oh i did this yesterday i better do it again today let me just do this here um i'll get to the question of the cues in a moment look amazon this is the this is the fang stocks amazon soles at 3470 right now up 12 after pulling back off to the peak b at 3547 all-time high on the 13th of july 3773.08 just missed a round number and then it did that pattern we spoke about it live on air it did the dreaded age pattern and then gap down huge and i said it could be a one-two if this fails amazon fails i thought there was a short term top in place and that if amazon fail there could be a one-two-one to the downside bam it goes to 3506 back in july tries to rally makes a second arch formation plummets under the 200 period moving average and then makes a low doji candle low at 3175.76 3175.76 and that was round about the 17th of august and now it's at a fabulous run and now it's stalling again so i went through each one of these apple we did amazon netflix pe doji candle top at 600 why not i though i didn't and i lost the information but now i'm saving every single thing click every second i'm saving so makes a high of 600 600 and show up 615.60 i remember i thought it was a round number there was a 60 614.60 and it's right now it's 583 5 decline peak e probably in the weekly chart leg d that's right yesterday we spoke about the leg d in the monthly chart and what am i missing facebook so i wanted to discuss character i wanted to discuss thinking and i want you to discuss the masses what the masses want there's always this talk about what the gen what the population wants i say boo you cannot do that the population gets things wrong at the last because the media pumps and pumps and pumps something it can't happen two three times it has to be said over and over and over until it's so ingrained in always think that some some phrase has to be perpetuated so that it is out in the boondocks out of the in the where humanity is sparse when those people start to repeat ad nauseam what's been said months or years ago then you say oh my god that's that's that's a top for that particular index so i wanted to talk about it in terms i don't want to do that today but i'll talk about it some point if i find the time to talk about your impressions and why technical analysis for as far as i'm concerned is so important look i don't happen to like uh facebook guy what was his name of course i must have intentionally blocked it out psychologically um i can see his picture right now anyway i don't like him uh but i gave him praise in the very first earnings report on facebook uh thank you mark second book i always need a mark second book because he turned the company around he was just this harvard graduate he comes up with a good idea i don't know if he stole or not but he came up with this idea of monetizing something and he did it wrong and then he did it once he started to figure out when when when the complaints came in the business side complaints came in he rectified it and he's turned that into an incredible company i remember subscribers saying in the 18s wow this is probably the buy of a lifetime well probably it was a buy of a lifetime but that's so completely separate to the business side of it look at facebook almost at an all-time high so you've got to separate and that's what i say to subscribers when occasionally there's wbi i can't remember if it's still there there's wbi yeah smith and weston when i get a buy signal smith and weston i say hey it's up to you you can take that money that you make if you if you make money uh in this this is firearms at all you can take that money and and put it to to anti anti gun whatever legislate whatever you want you've got to try to separate these things because if you want to be moral you've got to be moral about everything and that's kind of tough to do in the stock market i'm not saying to buy it i'm just saying morality is something that's really it's a tough tough not to crack therefore technical analysis is really what we want to be looking at and if you do a technical analysis the qqq was at a point where at least in the short term based certainly on the chapter made methodology there was signs to say at least near term you've got a chance of pulling back to consolidate that weekly chart is still spectacular the monthly chart is more than spectacular but you go one thing at a time and then one thing at a time is just suggesting that the cues because the leadership once again i'm not getting to the morality of it because google is everywhere those of you who know that you suddenly get advertising where you've just been thinking about some particular product um you know there's something out there two separate things qqq cues are pulling back but if they break p seventy two p seventy two support that's serious i think that's a chance back in the moment for the correct way uh analysis of a couple of stocks like biger to do that are you in the market for buying or selling real estate in the bay area including the surrounding st petersburg tampa and 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up 13 gold and bonds are moving in the same direction that's that's uh hasn't quite worked that way for a little while and we're gonna be watching this very closely because you remember i circled this in the gold contract i said we break down means one thing if we turn around you've got your u-shaped pattern i'm going to draw that in as an alternative right there and that's going to suggest that the 200p moving average of 1814 will become a target and if at 1807 if we can get to 1809 60 then all of a sudden that 1840 level becomes a real strong magnet a couple of questions came in oh before we go to our our caller we're going to go to just i wanted to show you fxi same thing pulling back in the pd uh watch this closely it's down 87 cents this is china the big cap china fund let's go to uh sharky in boston hi sharky how are you hi basil how are you good to uh good to talk to you again please talk to you yes you'd like to look at yeah at the vix i was you know i was kind of looking at the um you know a weekly a one year and then i was looking at the 120 minute and you know in the whole scheme of things with um you know it's the tide changing in the markets and stuff and and uh you know i'm kind of looking at how this way that the the sharks kind of underneath you know 20 or so feet circling underneath and they haven't quite reached the surface yet and and made the made the real turn here and stuff and i'm just kind of wondering what what what does the vix have to do here it looks to me like you know in a in a one-year weekly that the vix is kind of going sideways and i guess you could draw a rectangle pattern there and then i looked at it 120 minute and you can see that too but i'm i'm interesting you know where the vix has to go to to to kind of seal this thing and and and uh you know kind of it'd be the uh i don't want to say a feeding frenzy on the downside but but that's kind of what i'm thinking i think you're you're in the water a little too much there especially when the water's cold at this time of the year so okay let's just do this in a very uh methodical way the vix index ran up to a peak e on the 120 minute chart in the eighth e and then it pulls back and then had a spectacular move uh partly yesterday and then partly again early today this is what i'm going to tell you make it as simple as possible the numbers i look at have changed they've been forced to change because of covid we've had a higher level of uncertainty which means that all that stuff we saw in the nines of the tens on the volatility index they just haven't seen that much maybe you'll see one little slide into the 11 12 area but basically we've been hugging the 16 to 18 19 area more important is the fact that within the context of the volatility index i'm going to show the daily chart and i mentioned on friday oh was it friday yes it's a weekly chart on friday that if we close strongly in the volatility index and this is one of the other aspects where i was thinking of um um where i was thinking of the short short positions that we got for subscribers to my opening call um yeah is that if it closed high it could be the first time in weeks and actually a couple of months and a month and a half the last time it did that was back on the eight the week of the 18th of june when it hit 21.04 and then closed at 20.70 that week however it it's really the fact that on a closing basis we're talking about closing basis we're talking about way back in march the week of the fifth of march when it hit 31.90 that was the last time that it actually closed confidently above 20 it might have been just above 20 but it was a red candle so i'm just going to say to you to make it as simple as possible the vixen the volatility index needs to hold in the 19 to 20 plus area in other words anything above 19 on a closing basis on friday this coming friday will suggest to me that there's a certain um consistency in the selling pressure that's number one number two it says that the volatility index is in play and i just wanted to see here someone sent foot buying what was the dow transports historically okay let me just see this a good good this is part of what we're talking about the dow transport historically leads when big moves with big moves first is one of the best signals out there something something that does remain the same yeah you know i i i have to kind of agree with that paul i i don't i don't disagree at all but it's a divergence it's one of those things with timing that because the transportation index has just been going down down down we've seen the markets generally going up to new highs so that doesn't tell you anything about timing it just it's like when you look at 1929 you look and you say oh my god the uh advanced decline line was going down yeah it was going down for 18 months so which day would you go to short you know you if you do the chapwave analysis at some point i'll bring it back again haven't discussed it for ages we've got our peaks uh even there uh you're going back historically we've got the peaks that gave you uh tops but that's completely separate so i'm going to make it simple volatility index at 19.60 right now is only up 23 cents it's not a big deal if you start to see a consistent level of the 19s as support oh i'd even say 1850 as support but every other day or every two days you start to see a bounce into the 20 21 area that's a sign to say the the the big guns are really out there and they are taking this very seriously and they're getting protection for their portfolios that's number one now i've already done number one this is number two number three is that you want to see if you are short you want to see confirmation with the volatility index closing near the highs of the day with a nice green candle with a doubt triple digital down sharply and the s and p double digit down and you want to see that as a consistent theme so that the future is not like today this is a this is a fake out by some serious players where they're allowing the market to pop to the upside and this is the third day we've seen out of six days maybe we could even call this the third or fourth day where we've seen the sessions pulled back from the highs and that to me says we were looking at a chance of distribution in many of the stocks especially the fangs stocks f a a n g and we're starting to see them start start to weaken that was leadership yesterday we saw the semiconductors move higher not hold again but move higher and even today they're holding near near the highs so there are clues to say this is what we want to look at as leftover strength so i'm going to make it clear as the vix index either moves into the 20s and starts to hold and for the next at least week you want to see many days where you see triple digits down moves in the dowel and double strong double digit moves in the s and p and they they must close near the lows of the day that's where we're getting a serious sell signal right now those are things to look for hope that helps you know touch thank thank you very much so you you have a great rest of the day a safe one okay you too thank you very much uh we'll be back folks in a moment thousand three hundred seventy sharpening your skills as an investor is like getting better at playing a musical instrument you have to practice sure but you also need excellent instruction from experts at tfnn you'll get advice and guidance from the authority and technical market analysis and it's not just dry tedious text either tfnn airs live financial content streamed live on tfnn.com and tfnn's youtube channel with tiger tv live every market day from 8 30 a.m to 4 p.m eastern for free each host is an experienced trader and gives their take on the market while taking calls and questions live from around the world from the moment the market opens until the closing bell sounds tiger tv has eight different shows with expert hosts to help you make the right moves 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Petersburg, Florida, the investment is for four years paying seven percent per year or seven thousand dollars per one hundred thousand dollars invested your investment is secured by high-value real estate in st. Petersburg, Florida your investment can be anywhere from one hundred thousand to five hundred thousand you want to make one thousand per year on a hundred thousand dollars invested 7,000 per year on a secured Tiger First mortgage. The Tiger First mortgage program may be just the program for you. The Tiger First mortgage program pays 7% per year, paid monthly. For more information you can call 877-518-9190. That's 877-518-9190. This segment is brought to you by Think or Swim. For more information just click the Think or Swim banner on the front page of TFNN.com. Hi folks, just before we get to our last segment here I just want to show you just the sideways move, another side, we've just seen it's over and over. Sideways move lower, sideways move lower, sideways now. Theoretically when you're at lows the sideways move should see a pop above the rectangle high and then a test and if it breaks down again it says whoops you're going to stick around here with lower lows and lower highs and here we are. There's no rally to speak of down 16 in the S&P, still not a really bad action. At minus 22 I'd say oh now you've got to be careful so this allows for some kind of a pop back into that upper rectangle towards at 4453 in the S&P you many 4460 4462 that's something to watch and later in the day I'd say to subscribers this is what I do for my subscribers every day. Let me show you that was there. Was that yesterday? No that was not yesterday what I do every day is right here. Oh there it is so that was a previous day. Today I said a down close up 281 at 34871 but an inside day there's an inside day and then I give a whole analysis analysis and then I say if after 1.30 p.m. the day is minus 50s or more this is with the futures we're hugely up this morning or more the chances of a week close increases especially if the cues drag it down and that I'm staying with that that's the theme and that's the little analysis I give every day besides my my traders corner and whatever charts I think is important to show. So don't forget you've got programming here you've got think of swim coming up after me you know this is Kevin Hinks and the crew fabulous program on options we've got then you've got Larry Presidential Larry we'll be back today I guess I believe he's got a guest fabulous you've got Steve Boat you've got Dave White you've got Tom McCartney I'll be back with Tom McCartney later on this afternoon have a great day I'll see you back tomorrow check out my date with the house down 254 s if you say darling