Writing in the August 2013 issue of AAII Journal,
Michael Kahn points out that all that’s needed “is a chart with one or more of
the readily available tools found on most free financial websites. The goal is
to spot stocks that have stopped going up or are about to stop going up.” His
article is addressed to AAII members at:
Michael covers chart signals to look for, watching
the trend, spotting the end of an upward run, looking for new lows after a new
high is not reached, relative performance and fading momentum, and combining
charts and fundamentals. His article includes a chart that illustrates two such
signals. See:
I tend to look first at the MACD portion of first the
5-year chart and then the 3-month. For example, the MACD portion of my 5-year
Yahool chart of VTI suggests a fresh buying opportunity of an ETF that tracks
the total stock market. Also, its green 50-day moving-average line recently
moved higher than its 100-day m.a. line. See:
And my 3-month chart provides double confirmation.
It first provided a sell signal in mid-June 2013 when its blue VTI line fell below its green
20-day m.a. line and a few days later crossed below its red 50-day m.a.
Also, the blue VTI line confirmed a buy signal first
by crossing back above the green 20-day m.a. and again when the 20-day m.a.
line moved higher than its red 50-day m.a. line. See:
You can find a thorough explanation of MACD at:
Never forget this: All investments and savings are gambles on
the unknowable future and thus subject to loss as well as gain.
Do visit my website for lots more research I share with
do-it-yourself portfolio managers:
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