Richard Gobel, owner and operator of Strategic Stock Trade, has more than 30 years of experience in the investment business.
Over the past few years, he has been using technical analysis and algorithms to develop day-to-day trading strategies to make financial decisions.
One of the keys to his success has been seeking out extreme conditions in the action of stocks. Using those extreme set-ups has guided him in initiating long and short positions based on trading algorithms to track extreme set-ups. When a stock is at its most extreme overbought condition, it will be flashing between 99-100 on his Extreme Set-Up scale. And when it is at its most oversold condition, the stock will be flashing between 1-0.
The ETF tracking the S&P 500 was at its second-lowest volume day of the year at a time markets are moving higher.
After trading most of Friday in the red, the indexes were able to close higher.
The short hedge funds have finished covering their positions at the market highs. The market subsequently sells off shortly thereafter. The perfect sell signal as they buy at the all time highs.
The market turned to the downside. The last pocket of strength -- momentum tech stocks -- are now in Overbought territory.
Nothing like selling at the lows and buying at the highs.
A possible index rotation may be at hand.
As expected, the glow from the Federal Reserve chief didn't last and most stocks fell.
It's going to take a lot of work for the Nasdaq and Russell 2000 to get out of bearish territory.
The head of the Federal Reserve made sure she said all the right things.
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