# Point and figure trading of US stocks



## PFtrader2012 (1 November 2012)

Here I will share thoughts on US stocks using:

technical analysis,
point and figure charting,
market analysis,
sector analysis,
Richard D. Wyckoff method analysis,
relative strength analysis,
and inner thoughts and feelings.

In my trading I have been using point and figure and the Richard D. Wyckoff method for many years now. I usually do top-down analysis by first identifying the market setup, I then do sector analysis and relative strength analysis to find the strongest or weakest stocks in the strongest or weakest sectors.

In my investing I combine fundamental analysis with the above and I use a few exceptional market timing signals for longer term bullishness or bearishness. These have showed to be far more accurate than my own feelings, so I’d rather trust the professional quantitative analysts than my own emotions. These signals are also used in my shorter term trading.

Here I will gather my thoughts and post my trading ideas.  These are my ideas, and you are invited to follow me. I like to exchange ideas and learn from my readers as well.


----------



## PFtrader2012 (1 November 2012)

*My Point and Figure trading journal 2012*

Here is a standard Point and Figure analysis / Wyckoff Technical analysis setup for AAPL that I have been trading with success this past year.






This is what I usually look at in my technical trading: P&F chart of the stock. Bar chart of the stock. A P&F chart of the market (S&P 500). The Relative Strength versus the market. Usually I don't do RS analysis of the sectors. I get a fairly good view on the strong and weak sectors to avoid just by viewing their charts. As long as we are stronger than market, we're usually golden.

So what about the analysis of AAPL? 
We are in a down trend with some kind of support at around 580. We already broke the 650 support. (And I got stopped out.) We went back to lick it (Wyckoff test of ice, guys). Markets seem to want to go south, but is hesitating a bit. AAPL is short-term weaker than the market which is generally not a good sign. AAPL has been a market leader for a long time, and when the market leaders stop going up, normally the rest of the pack will follow it sideways or down.


----------



## PFtrader2012 (2 November 2012)

*My Point and Figure trading journal 2012*

Looking at REED technical analysis today.

On the 1% point and figure chart we are at a nice level of support at this level:






On the Candle stick chart we can see the nice uptrend. The last candle tried to go down but closed at the top - a bullish sign.


----------



## PFtrader2012 (5 November 2012)

*My Point and Figure trading journal 2012*

Let's have a look at URI, a stock I have been interested in a long time. Nice fundamentals and all.

We have quite a nice setup. We had a strong up move on heavy volume over the 37-38 area, gapped up even. Had a pullback/flat for a few days on much lower volume and then shot up again on heavier volume. 

Another pullback/breather now, let's see the future.


----------



## PFtrader2012 (6 November 2012)

ECL is another stock on my list.

I really like the uptrend it is showing on the daily and weekly point & figure charts. The candlestick charts shows the latest strong upmove on high volume and BIG bars. Somebody really wants to own this company, but taking a breather at the previous resistance, now acting as support. A pullback to the side of the creek - for using the Wyckoff trader lingo.

Daily Point & figure chart





with weekly point and figure chart:


----------



## PFtrader2012 (6 November 2012)

Today I have four strong stocks. These are in the Utilities group that has performed well and been a market leader for a period.

First a technical analysis of AME
here we broke through the resistance at around 35.50. Now we seems to have a quick pullback on lower volume and I would not be surprised to see us head up if markets want to go higher from here.

We can notice a nice wyckoff spring at the end of the trading range before the breakout. For Spring traders this was just screaming out to buy. Springs are something I have always had trouble with, although they are a very reliable signal. With some hindsight in technical analysis they are a great confirmation in my opinion.


----------



## PFtrader2012 (7 November 2012)

Next technical analysis is DE - Deere & Company. These guys make tractors!

Tractors are apparently selling well, because we are breaking out of every resistance point there is. The point and figure 45 degree down trend line, and any minor resistance on the way. Now we had a slight pullback, a trading range above the resisitance "creek" on diminishing volume.

Also here we can see the Wyckoff spring in first part of october. You had to be cool to enter on it, but you had also been happy with your profits.


----------



## PFtrader2012 (7 November 2012)

Then we have PHM. Never heard of em...

PulteGroup, Inc., through its subsidiaries, engages in homebuilding and financial services businesses primarily in the United States.

Alrighty then, homebuilders. People need homes right?

Point and figure analysis - old resistance became support in the 17 level, now we are at resistance, or double top. We have a major diagonal uptrend in the bar chart. Strong.


----------



## PFtrader2012 (7 November 2012)

Then some Rock n roll:

ROK

The last three days have been exceptional.

The formation leading to that crazy breakout is quite strange with lower lows and lower highs. That's what some people would call a flag. Chart patterns were my introduction to price action analysis and trading. From that I moved to Richard D Wyckoff's work, and later simplified my own analysis with heavier focus on Point and Figure and confirming analysis on bar charts or candle stick charts.


----------



## PFtrader2012 (7 November 2012)

I just had to include this one also. SPRT. High risk - high reward?

I normally do not like these companies that are driven by news, but this pharmaceutical company apparently had a drug approved or something and the news made it blow through the roof. Now we are in a pullback after that news, and perhaps at a place where we might see a reversal.






About halfway of closing the gap. Normally a Wyckoff trader would consider the half-way point from top to bottom of pullback. When we're having a gap, we must look at it another way. Gaps want to be filled. That is one of their only reason for living.... A strong stock will not fill its gap, but it still wants to be tested. If we don't fill the gap, we are dealing with a strong stock.

Now, the point & figure chart just looks like a column of X and a column of O. Interesting to not when we're talking about half-way points - the column of X is 44 boxes, and the column of O is 22 boxes - and for those of you that know basic math, that is half.


----------



## PFtrader2012 (8 November 2012)

First of all,

sorry the post yesterday should have been SRPT and not SPRT - two different securities.

The one in my pics is SRPT.

Ever bought or sold the wrong stock? I have. You feel like an idiot when you do. It happens
to everyone once in a while I guess.


Anyway....


We had an up move in the markets. Dare we believe that it will continue, or did we see a reversal bar yesterday?
A "peek-a-boo" in the resistance zone at 1420? Will we jump into that zone or was it the last time we saw these levels
for some time?

Looking at the Spiders SPY.






The 5 box size says we're approaching a resistance zone above 145.
The 1 box size says we're heading down through the support at 142.

I wrote a little poem for you:

What do you do,
when you are in doubt?
When you don't have a clue?
You had better stay out!


----------



## PFtrader2012 (8 November 2012)

Is it safe to say that the general market does not like the elected president? 
No confidence in the president's abilities to solve the financial trouble?

Is it safe to say that the market had a terrible day?

We officially jumped into the deep water, with a big splash. Huge bar, huge volume. Force.

I expect lower prices, with a test of the new resistance zone at some point.






We can confidently start looking at some short candidates.


----------



## PFtrader2012 (9 November 2012)

Yes we're heading downwards. The volume has picked up significantly - what I would call heavy selling.

The point and figure chart shows two levels of support at 137, the previous resistance level and a minor
45 degree trendline - both at the same level of 137. Another 45 degree trendline below that might
be the next support somewhere close to 134, where we also have a support level on the point and figure
plottings.






Looking at the barchart we can see that recently up-moves have had smaller and more bara, while
the down moves have been on larger and fewer bars - this shows that the line of least resistance have been down.
Likewise we can also note that the volume has been heavier on the down moves.

The last two days have had much heavier volume than any other bar lately.


----------



## PFtrader2012 (12 November 2012)

Sundays are good for doing general market analysis before markets open on Monday. I'd rather take Friday afternoon off, and do it on Sundays instead.

S&P500 has been weaker than Nasdaq, on a long term scale - Big chart on the right is the Relative Strength of SPY and QQQ.






This is normal. Now that we are on our way down I am assuming technology based Nasdaq will perform worse.

We did have an up day on Friday - but not very big, more of a breather. But still a heavy reversal with a close on the low end of the range. Tried to go up, closed down - if we can't go up, we will probably go down.


----------



## PFtrader2012 (14 November 2012)

Facebook stock technical analysis

Assuming Nasdaq will perform worse in a bear market, it is safe to assume FB will perform badly as it has since the IPO. Action has been terrible and I feel for the people who bought there and then on promises. Who dares touching this one now. There are some technical points to consider which can provide for good setups. A break out below the 18 level would mean to me that we are heading down again, a confirming pullback on low volume for added confidence. The action in the current trading range is quite erratic. I don't see real stopping action, more a low base type of pattern.


----------



## PFtrader2012 (14 November 2012)

Approaching or breaking nearest 45 degree point & figure trendlines:

AEE BREAKING:


----------



## PFtrader2012 (14 November 2012)

PCG approaching 39-40 level P&F trend line


----------



## PFtrader2012 (14 November 2012)

PPL

Somewhat strong compared to the others, but at an interesting technical level


----------



## PFtrader2012 (14 November 2012)

SO

I don't want to own Southern


----------



## PFtrader2012 (14 November 2012)

EXC looks so bad it does not even fit into the percentage point & figure chart without zooming


----------



## PFtrader2012 (14 November 2012)

Moving further downwards. We have already broken the technical level on the SP500 that we identified time ago. We will see a pullback at some point, but for now we are continuing to focus on the weak stocks to short.

CPE has a double bottom point and figure pattern at 4.50 on the 1% chart. The candle stick chart shows the quick pullback on lower volume. Looks like a nice short to me.


----------



## PFtrader2012 (15 November 2012)

We had a huge up bar in FB which we are interested in mainly on the short side.

We are still in the range we identified, and these huge up moves have happened before in this range.

If we have worse times ahead, an entry at the top of this range could prove fruitful.


----------



## PFtrader2012 (15 November 2012)

ACN is a tech stock that is in a nice downtrend, we are abit over extended for going short, unless the bottom falls ut at this point, as we are at a support level.


----------



## PFtrader2012 (15 November 2012)

For a trend follower ADP only means following it down. Maybe to 50.


----------



## PFtrader2012 (15 November 2012)

UTX in a break down through the short term support


----------



## PFtrader2012 (16 November 2012)

The market is getting somewhat oversold, and we WILL get a pullback at some point. WHEN the pullback comes a short term trader could enter positions in strong stocks, if keeping in mind that the 3 month longer trend is down.

We will get a pullback and test the 1400 level in SP500. If we get that far, or if we even go through it - only time will tell.


----------



## PFtrader2012 (17 November 2012)

DVN breaks some tough support while SP500 breaks its support


----------



## PFtrader2012 (19 November 2012)

We've had a big drop and will likely get a rally from here somewhere. Markets move up and down. We could be testing or entering the yellow area during this week. On Friday we saw a reversal bar.


----------



## PFtrader2012 (21 November 2012)

For now it seems like we are in the rally we were anticipating earlier. How long it lasts, or if this is the beginning of a larger up - nobody knows.

KORS is an interesting stock for an upmove. It gapped earlier this year and we have now tried to close that gap, but failed. Instead we had a Wyckoff spring at the 48 level. On the P&F chart this reversal is happening at the exact level of the 49 top earlier this year.


----------



## PFtrader2012 (21 November 2012)

The Intraday point and figure chart of EXPE tells us we might be breaking the 60 level.


----------



## PFtrader2012 (21 November 2012)

Technical Wyckoff analysis of APPLE.

AAPL is again becoming interesting. A stock that has been in the highest number of funds, with funds then wanting to get rid of it, securing profits, as we have seen in the downtrend. We now had some stopping action with the reversal on Friday, and now a big up move. Potential selling climax and automatic rally, as Wyckoff traders would call this. The next pullback would probably provide a great risk/reward position if the selling climax holds, and also a break out above the current rally.

If the test of the selling climax does not hold, and we again see downside in the market. Then it is another story.


----------



## PFtrader2012 (21 November 2012)

Another bullish bar in the market, and we got the reversal to X column in the SPY. Let's see if it will meet the resistance as we identified earlier.


----------



## PFtrader2012 (21 November 2012)

S looks like it will want to head higher. We are pulling back to the gap on minimal volume.


----------



## PFtrader2012 (23 November 2012)

How far up can we go? That is the question on many traders' minds right now.

Looking at SPY - the rally is on rather low volume. The thrust is weakening.

We are now looking for clues, evaluating if we will have a small pullback and go higher OR if we will head down again another leg.

We are approaching the resistance zone, the "ice" that we have fallen though, in the P&F chart. On the candlestick chart we can see that we are approaching a short term trend line.


----------



## PFtrader2012 (23 November 2012)

CNP

will we finally fall through the 45 degree p&F trendline?


----------



## PFtrader2012 (24 November 2012)

It is always interesting to see the big picture of the market on a weekly chart of SPY and weekly 5 point figure chart of SPY.

We are actually in a clear uptrend, had a pullback, that did not reach the lower trendline in place since 2009. On the short time frame trend line we can the higher high turning roughly at the level of this trendline.

On the 5 point figure chart we are in an uptrend, have broken a downtrend line and have a rising 45 degree trendline at our support.


----------



## PFtrader2012 (27 November 2012)

Looking at two strong stocks AFFY and OCN


----------



## PFtrader2012 (27 November 2012)

And lets compare the relative strength -

Which one would a trader choose? Among these nice performers the decision is hard. Based on technicals, AFFY is stronger. Usually it pays off to be in the strongest stocks.

The long term shows Affy being stronger, with a current pullback





Same is noted in the short term also, in the right hand side we have the 1 month view, in the left hand side longer term view. Bottom chart on each side is the RS calculation


----------



## PFtrader2012 (28 November 2012)

YELP is all over the place, reminds me of a buddy of mine who was never able to sit still when we we're young. He got in trouble in school all the time.

For traders who enjoy trading range action this could be a play.


----------



## PFtrader2012 (28 November 2012)

Two cruise line stocks-
RCL and CCL

Both strong. Looks like a nice industry and a nice ride - not just for the passengers of the cruise lines, but for the speculators as well.


----------



## PFtrader2012 (29 November 2012)

Facebook - FB - the stock that everybody is scared of has had some great days. Are we running out of steam?

How many millions did you say you lost when invested in the IPO?!


----------



## PFtrader2012 (29 November 2012)

S&P500 is still at the previous area of support, the old high from before.


----------



## PFtrader2012 (1 December 2012)

As markets are rallying so is AAPL. A pullback will give us a nice risk/reward entry point.


----------



## PFtrader2012 (1 December 2012)

CCI has a very nice point & figure pattern


----------



## PFtrader2012 (1 December 2012)

CRM is breaking a technical level


----------



## PFtrader2012 (3 December 2012)

SPY is still hesitating at this technical level. We had two days without much movement.


----------



## PFtrader2012 (4 December 2012)

If we go down from here, we will want to be in weak stocks like NE, which is breaking down through the double bottom p&f pattern (chart on right hand side)


----------



## PFtrader2012 (4 December 2012)

POT is also performing like something you would not even touch with a long stick, unless you want to be short


----------



## PFtrader2012 (5 December 2012)

In technical analysis you often find things that make you go hmmmmmm....


----------



## PFtrader2012 (5 December 2012)

hmmmmmmmm........

Are we actually in the beginning of a severe bear move - or will we really have the force to break through?


----------



## PFtrader2012 (7 December 2012)

Where are you heading Mr. Spyder?


----------



## PFtrader2012 (7 December 2012)

And what about you Mr. Appleman, we have made so much money together before?

Just give me the sign and I will follow you AAPL!


----------



## PFtrader2012 (8 December 2012)

WHR has a pullback in a very strong uptrend


----------



## PFtrader2012 (11 December 2012)

URI - double top P&F pattern


----------



## PFtrader2012 (11 December 2012)

CHK - double bottom P&F pattern


----------



## PFtrader2012 (12 December 2012)

Volume diminishing in SPY - rally fading?


----------



## PFtrader2012 (13 December 2012)

These are the technical levels of interest in the S&P500 if going up further.


----------



## PFtrader2012 (13 December 2012)

We got another X entry in SPY PnF


----------



## PFtrader2012 (13 December 2012)

URBN is interesting. Will it pullback or go?


----------



## PFtrader2012 (14 December 2012)

LULU - if you're into yoga and trading...


----------



## PFtrader2012 (15 December 2012)

Apple, apple, apple.... :-( So AAPL opens down alot AGAIN.... once leaders, will they lead everybody else down as well


----------



## PFtrader2012 (15 December 2012)

AAPL had a catastrophic day. Plunged below previous support on the P&F chart. A technical analysis on a barchart would show AAPL at support is considering OHLC bars and not "close only".

SP500 is at resistance and odds are we are in for a reaction, which could fuel Apples down move even more. Let's see what next week brings us.


----------



## PFtrader2012 (18 December 2012)

I just love these SBAC charts - awesome


----------



## PFtrader2012 (18 December 2012)

IXYS - setting up for a potential short


----------



## PFtrader2012 (18 December 2012)

Here is a danger zone of AAPL - we will get a rally towards the danger zone which will be resistance that we would have to break through if we wanted a bullish trend.


----------



## PFtrader2012 (3 January 2013)

So, we survived fiscal cliff death for now... We also survived the Mayan end of the world, we survived the holidays.

Now it is time to start trading again after few weeks of vacation from the markets.

TEX breaks through double top and a previous resistance level.


----------



## PFtrader2012 (3 January 2013)

DLPH - what can you say? Fantastic profits from the double top break out. Currently overextended so don't enter positions right now, wait for a pullback for better risk/reward.


----------



## PFtrader2012 (3 January 2013)

APA - potential short with rally that we can sell if we see negative action


----------



## PFtrader2012 (4 January 2013)

EXPE - very nice looking pattern


----------



## PFtrader2012 (4 January 2013)

LEN performs well in the double top patterns, so far really well


----------



## PFtrader2012 (4 January 2013)

Here's a real loser - SKUL - the "Skullcandy" earphones kids used to want to have, but now rather die than be seen wearing them.


----------



## PFtrader2012 (4 January 2013)

NRG breaking both P&F trendline and resistance


----------



## PFtrader2012 (4 January 2013)

NVS

Breaking double top and long term resistance - two birds with one stone?


----------



## PFtrader2012 (4 January 2013)

DLTR

"dollar tree" actually made me some good money back in the days, but now severely under performing


----------



## PFtrader2012 (8 January 2013)

SP500 has had a great move and we are in for a reaction/pullback. We might stay flat also before trying to break out through the resistance.


----------



## PFtrader2012 (8 January 2013)

PHM is a great option for higher prices ahead


----------



## PFtrader2012 (9 January 2013)

AFL having a nice pullback in a strong uptrend. Nothing on the P&F chart that would make us want to avoid trading it.


----------



## PFtrader2012 (9 January 2013)

A Wyckoff Point and Figure charts provides us with a nice overview of the resistance we are meeting in the SP500.


----------



## PFtrader2012 (15 January 2013)

We have had a fantastic run in SP500 (which is higher than Nasdaq). We are very much extended from the moving averages, something that cannot go on forever. Traders should note that we are in for a reaction or to be range bound.

There are bullish topics in the air. According to Lipper, funds got inflow of in $18.3 billion first week of trading this year. The 4th largest inflow since January 1992.

We are exactly at the resistance level.


----------



## PFtrader2012 (15 January 2013)

CMC could do well from here with some resistance coming in at 18.


----------

