October 2006, Volume 3 Issue 6 Know It - Profit!
Boots-Up 17% Gain!"
With the other major indices failing to follow, can the Dow Jones Industrials continue to make new highs?
Or... are we seeing a top in large capital stocks? For a clue, check out this month's Featured Index in Market Metrics.
The Dow Jones Industrial Average (^DJI) has made new highs... up +7.59% for the year. Half of this year's all-time gain occurred in the last quarter.
The Russell 2000 (^RUT) has increased a modest +5.08%... only trading 63 points from its all-time high.
So far this year, the Standard & Poor's 500 (^GSPC) and Wilshire 5000 (^DWC) have added +4.85% and +4.53%, respectively.
Will the Nasdaq Composite (^IXIC) be able to dig out of its hole? Down -0.27% for the year, the technical index as been lagging... dragging investors down with it.
Want to see a side-by-side comparison of the indices? Click on Market Metrics...
Click Here For Broad Market Analysis
The CBOE GSTI Software Index (^GSO) posted a third quarter addition of +17.62% while the CBOE GSTI Hardware Index (^GHA) wasn't far behind with a +16.11% gain.
The PHLX KBW Capital Markets Index (^KSX) was up, as well... adding +8.70% for the quarter.
The AMEX Computer Technology Index (^XCI) and AMEX North American Telecom Index (^XTC) are in the black... up +9.00% and +8.63% for the quarter, respectively.
How are the other sectors fairing? Take a look in Market Metrics...
Click Here For More Stock Sectors
This month's featured chart, Salesforce.com (CRM) has exploded... rocketing skyward for an +83% gain since July!
View Current Chart of CRM
The weekly chart of CRM
forecasts nothing but profits as the stock prepares to complete an intermediate Elliott fifth wave impulse.
The Commodity Channel Index (CCI) confirms the bullish trend is in place... having been in positive territory for the previous two months.
The MA Oscillator has made two bullish crossovers. The trend line break in August and the standard deviation line break this month confirm the upward trend.
Look for a minor Elliott fourth wave pull-back to the moving average channel (gray lines) before CRM begins it move to the $45-$49 price target.
Where Are They, Now?...
The following table represents hypothetical trades based on my previous picks and analysis...
Go Here For Charts In Action
Want to see more trading results?...
Historically, October has been a month for profit taking.
Additionally, the fourth quarter trading volume often dries up as the year winds down.
Prepare your portfolios, accordingly.
Until next time...
Russ Schmidt, President
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It should not be assumed the technical indicators, analysis techniques or trading methods presented in this newsletter will be profitable or that trading decisions based on their use will not result in losses. Past results are not necessarily indicative of future results. Examples presented in this newsletter are for educational purposes only. Any trade set-up illustrated is not a solicitation to buy or sell a security. The author, publisher and any affiliate linked to this newsletter assume no responsibility for your trading results. Remember... there is a high degree of risk in trading.
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CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.
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