Trading Places with Tom Bowley

Tom Bowley
About the author: co-founded Invested Central and served as the site's Chief Market Strategist for more than 10 years. His unique trading style combines both his fundamental and technical strategies to systematically manage risk while trading. A regular contributor to StockCharts.com's bi-weekly ChartWatchers newsletter since 2006, Tom's role at StockCharts has expanded significantly since he joined the company as a full-time Senior Technical Analyst in March of 2015.

Latest Posts

Trading Places with Tom Bowley

Solid Earnings Lift Financials, Wall Street

by Tom Bowley

Market Recap for Wednesday, January 16, 2019 Late-day selling cut into some of Wall Street's gains, but the bear market rally continued.  It's left many wondering whether we're still in a bear market.  The technical answer to that question is yes, we're in a bear market until we see a rally of 20%.  The S&P 500 has rallied close to 12% off the bottom, so there's still a long way to go: There have been a number of reasons for the rally, with the most obvious being that we were simply way oversold and needed a bounce.  The daily RSI in the chart above is now into Read More 

Trading Places with Tom Bowley

10 S&P 500 Stocks That Seasonally Outperform From February Through April

by Tom Bowley

Market Recap for Tuesday, January 15, 2019 We saw an across-the-board advance led by healthcare (XLV, +1.80%), communication services (XLC, +1.66%) and technology (XLK, +1.51%).  All of our major indices jumped as NASDAQ shares soared by 1.71%.  The S&P 500 rose 1.07%.  After a slow start, the small cap Russell 2000 played "catch up" and winded up gaining 0.87%, while the Dow Jones tacked on another 0.65%.  The biggest headline, however, was likely the move by internet stocks ($DJUSNS, +2.85%).  There's clearly a weekly resistance test that's in play, but Read More 

Trading Places with Tom Bowley

Banks Rally On Citigroup's Results, But Likely To Struggle Today With JP Morgan's

by Tom Bowley

Market Recap for Monday, January 14, 2019 The losses on Monday were not huge, but there did seem to be selling in most areas of the market.  10 of 11 sectors finished lower as financials (XLF, +0.69%) was the only sector to finish in positive territory.  That sector's strength likely resulted simply from relief - relief that Citigroup (C) didn't warn about 2019.  All of our major indices finished lower, led by the more aggressive Russell 2000 and NASDAQ, which dropped 1.01% and 0.94%, respectively.  By comparison, the S&P 500 and Dow Jones lost just 0.53% and Read More 

Trading Places with Tom Bowley

Will Earnings Sustain The Current Rally? Probably Not

by Tom Bowley

Market Recap for Friday, January 11, 2019 Healthcare (XLV, +0.33%) and consumer staples (XLP, +0.29%) paced a bifurcated market on Friday as the Russell 2000 eked out a 2 point gain.  Despite rallying most of the session after a poor start, the Dow Jones, S&P 500 and NASDAQ fell short of moving into positive territory and finished with minor losses of 0.02%, 0.01%, and 0.21%, respectively.  The Dow Jones ended with half of its components higher, half lower.  Among sectors, five were higher, six were lower.  Clearly, it was one of those kind of days. Read More 

Trading Places with Tom Bowley

Correlation Suggests That We Monitor Treasury Yields Closely

by Tom Bowley

Market Recap for Thursday, January 10, 2019 There was both good and bad action on Thursday.  Yes, the bulls should be excited as a short-term price and trendline breakdown did not result in panic or a Volatility Index ($VIX) that surged.  Also, all of our major indices remained above their ascending 20 day EMAs.  So long as that continues, a tradable uptrend remains in play.  By the close, the Dow Jones, S&P 500, NASDAQ and Russell 2000 all finished higher, gaining 0.51%, 0.45%, 0.46%, and 0.42%, respectively.  Considering that each started the day 0.75%-1.00% Read More 

Trading Places with Tom Bowley

Crude Oil Surges, Energy Paces Wall Street Advance; Negative Divergences Loom

by Tom Bowley

Market Recap for Wednesday, January 9, 2019 Crude oil ($WTIC, +5.18%) continued rolling higher on Wednesday, buoyed at least in part from its positive divergence.  Recently, I discussed the likelihood that crude oil prices would move back into the $50-$54 per barrel range and you can see from the chart that's where we are now: Positive divergences typically result in 50 period SMA tests and/or PPO centerline tests.  The WTIC is now close to its 50 day SMA and rapidly approaching its PPO centerline.  Many times, positive divergences mark long-term bottoms and I Read More 

Trading Places with Tom Bowley

Bear Market Rally Likely Nearing Its End

by Tom Bowley

Market Recap for Tuesday, January 8, 2019 It was another broad-based rally on Wall Street with 10 of 11 sectors finishing higher.  Small caps powered ahead 1.53% to lead the action, but the Dow Jones, S&P 500 and NASDAQ gained 1.09%, 0.97% and 1.08%, respectively, to join the party.  After bottoming at 2346, the S&P 500 has recovered 228 points, or 9.72% - similar to what we've seen in the past after "correction to bear market" breakdowns.  There's still more upside potential in this rally before the bulls will be put to the test, but a reversal could occur at any Read More 

Trading Places with Tom Bowley

Consumer Discretionary Makes Relative Breakout, Poised To Lead In 2019

by Tom Bowley

Market Recap for Monday, January 7, 2019 Crude oil prices ($WTIC, +1.17%) rallied on Monday, helping energy (XLE, +1.49%) continue its recent surge, but the day clearly belonged to consumer discretionary stocks (XLY, +2.26%) as retail (XRT, +3.10%) and home construction ($DJUSHB, +2.43%) were among the session's best performers.  It wasn't an across-the-board advance like we've seen in recent days as two defensive sectors, utilities (XLU, -0.68%) and consumer staples (XLP, -0.14%), failed to participate.  Also, financials (XLF, +0.12%) struggled on a relative basis as banks Read More 

Trading Places with Tom Bowley

One Industry Group Has Quietly Been "Building" Relative Strength

by Tom Bowley

Market Recap for Friday, January 4, 2019 Friday was a HUGE day for the bulls as nonfarm payrolls came in well ahead of expectations (312,000 vs 180,000), which in no way reflects what the stock market has been saying since Q4 2018 began - that we were heading towards slowing economic growth.  That simply was not the case with this jobs report.  To add more fuel to the fire, Fed Chair Jerome Powell (who served as the lead role in How The Grinch Stole Christmas), backed off earlier statements and exercised patience.  Powell now is indicating that he's understanding the Read More 

Trading Places with Tom Bowley

Apple's (AAPL) Guidance Wasn't As Shocking As Facebook's (FB)

by Tom Bowley

Market Recap for Thursday, January 3, 2019 Just about every market-related discussion since Wednesday's close has centered around Apple (AAPL, -9.96%).and for good reason.  AAPL is a U.S. stock market icon.  Some might argue it is THE icon.  When they lowered their revenue guidance substantially on Wednesday evening, it marked the first time in 17 years that AAPL lowered its revenue guidance.  They are the poster child of conservative guidance and traders know that AAPL will beat estimates.  It's simply how the market goes 'round.  I've discussed Read More 

Trading Places with Tom Bowley

Just Two Days After The Ball Drops, The Bomb Drops

by Tom Bowley

Market Recap for Wednesday, January 2, 2019 On a day filled with hope, as traders rang in the new year on Wall Street, the biggest news came after the market closed as Apple (AAPL) warned regarding its upcoming quarter.  During the trading day, we saw resiliency for one of the few times over the past five weeks.  U.S. markets opened quite weak yesterday, but managed to attract buyers throughout the session as all of our major indices finished in positive territory, led by the more aggressive Russell 2000 and NASDAQ, which gained 0.54% and 0.46%, respectively.  In terms of Read More 

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