Trend Check with Tushar Chande

Tushar Chande
About the author: , PhD, MBA, is the inventor behind an impressive collection of technical indicators, including the Aroon and Stochastic RSI. He has written several books, holds both a PhD in Engineering and an MBA in Finance, and has over two decades of experience trading the financial markets. Follow Tushar in this blog as he highlights his new "Trend Meter" indicator and shares his analysis of current market conditions.

Latest Posts

Trend Check with Tushar Chande

Which are the Strongest (and Weakest) Dow 30 Stocks?

by Tushar Chande

With the Dow closing above 25,000 for the first time ever, I take look at the components of the index and show which ones are strongest (and the ones driving the index higher).  I also look at NVDA and the $SOX index to show that the sell-off that caused the rotation out of tech and into financials has been mostly reversed within the past few days.  The broad market continues to be very strong, and I use the NY Composite chart to illustrate this point.  Lastly, I look at the key index and sector ETFs and show how they compare to the SPY ETF. Chart 1: The mythical "average" Read More 

Trend Check with Tushar Chande

2018 S&P 500 Forecast: Flat and Volatile (With New Sector Comparison Tool)

by Tushar Chande

Topic:  Historical model forecast suggests a flat 2018, with the potential for a volatile year.  The impact of tax law changes and mid-cycle elections could be the wild cards posing the biggest risks to my forecast.  A flat market forecast implies technical analysis will be more relevant than ever: so I show a new tool using SCTR and the Chande Trend Meter to make a joint measurement of relative and absolute trend strength. Chart 1: The 2018 forecast assuming a starting value of $SPX 2682.  The model is essentially flat, i.e., it is not expecting strong trends, but Read More 

Trend Check with Tushar Chande

Beneficiaries of Tax Reform

by Tushar Chande

How to find beneficiaries of tax reform? Well, four stocks stood out today: Blackberry (BB), FedEx(FDX), Wells Fargo (WFC) and Verizon (VZ).  They broke out to new highs as the tax reform legislation completed its journey through Congress.  One way you can search for the beneficiaries of tax reform is to look at jumps in SCTR or the Chande Trend Meter (CTM).  Another is to look at industry group trend strength via the CTM. I will briefly illustrate both approaches below. Chart 1: FedEx jumped higher as it is expected to benefit from the new tax regulations. Read More 

Trend Check with Tushar Chande

What Causes a MACD Divergence? (With Scan Code to Detect MACD Divergences)

by Tushar Chande

This blog post is for short-term players looking for counter-trend opportunities. This blog post explains why we observe divergences between the MACD indicator and stock prices.  I also describe the scan code for automatically detecting divergences using the StockCharts scan engine on daily and weekly data.  Short-term and swing traders can now automate the search for MACD divergences via this post.  Longer-term players will gain insight into how the MACD works.        Read More 

Trend Check with Tushar Chande

S&P 500 Pauses to Refresh

by Tushar Chande

Topics: Market consolidates under all time high; guessing support for $SPX; gold breaks down; semiconductors find support; dollar forms higher low, looks stronger technically.  A big thank you to Tom and Erin for inviting me to their Market Watchers Live show (on 12/06/17) and to all their listeners who tuned in and responded with questions and comments.  There are some references for you below (that connect to the discussion on the show).   Chart 1: The year-end forecast can be found here and here.   Read More 

Trend Check with Tushar Chande

Fasten Your Seatbelts

by Tushar Chande

The market is trading on emotion, so it is time to fasten your seat belts.  The melt-up in Financials best captures the near euphoric rally to new highs as tax cut legislation moved forward in the upper chamber in D.C.  As Chart 1 below of FINU, the ProShares Ultra Pro Financial Sector ETF shows, the past three days have seen sharp moves.  The last bar has a small open-close range and a long high-open range, which suggests the market has touched some resistance overhead.   Chart 1: The FINU accelerated to new highs, but as the last bar shows, it seems to have met some Read More 

Trend Check with Tushar Chande

Market Reaches My 2663 Target

by Tushar Chande

The $SPX high today (11/30) was 2657.74, a whisker away from my year-end target of 2663, a prediction I derived from my post-election model in April, and made explicit in my September 29 post (see below).  Not bad. Not bad at all.   Chart 1: Screen shot of my Sep 29 post.     Chart 2: The post-election model shows the most recent close is not very far from my year-end target. Read More 

Trend Check with Tushar Chande

Trend Analysis of Jim Cramer's Anointed 15 (Or, Using the Chande Trend Meter)

by Tushar Chande

The Chande Trend Meter (CTM) is a flexible tool for analyzing absolute trend strength across all time frames.  I will illustrate its application using a list of 15 stocks that Jim Cramer of CNBC called the "anointed ones", stocks that are likely to go higher because they have a strong institutional fan base on Wall Street.  I will show that CTM can be combined with StockChart's SCTR to find the stocks on Cramer's list. I will also show that CTM scales sensibly across time frames, from intra-day to monthly, whereas the SCTR is only computed using daily data and re-plotted on Read More 

Trend Check with Tushar Chande

Berkshire Hathaway (BRK.B) Attractive to Long-term Investors

by Tushar Chande

Berkshire Hathaway, buffeted by tax plan headlines, has pulled back into support, and offers a potential entry point for long-term investors. The market itself has seen selling in the short-term time frame. However, intermediate-term and long-term trends are still bullish, as they have been all year.   Chart 1: Berkshire Hathaway (BRK.B) retests its prior breakout at 182, with support starting at 177.  The solid black line is the 130-day simple moving average. (A live version of the chart is here.)     Read More 

Trend Check with Tushar Chande

Using Momentum ETFs

by Tushar Chande

Momentum ETFs are a useful way to invest in strongly trending markets.  Here momentum is generally measured as a combination of monthly returns over different periods.  Since capitalization is always a concern for the larger ETFs, the larger the capitalization and the stronger the recent price performance, the larger the allocation to the stock.  In general, when market trend strongly, momentum ETFs are expected to do well (see Chart 1). Chart 1: Momentum ETFs have typically done better than the $SPX as we should expect from their design. Read More 

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