A Simple S&P 500 Trade Signal
- Posted by Greg Harmon
- on February 7th, 2013
Renko Charts are a simple way to decide whether to be long or short a stock or index. These charts take the time element out of the equation so they work well in markets that are not really choppy. These look at movement within a time period (day, week, 5 minutes, whatever) to filter out some of the noise. Using the Average True Range (ATR) as a box size they have some
resemblance to Point and Figure Charts. If the boxes are empty or white then the buy signal confirms and if they are filled then a sell signal comes in. Take a look at the chart for the S&P 500 over the last 6 months using candlesticks. There are a couple of defined trends but also some periods of chop. Now compare that to the Renko chart underneath. A much clearer picture. Even if you are a gunslinging day trader these can add value for you. Take a look at the one month 15 minute charts comparison. Nice tool to have huh. By the way they both point higher.
Join the Dragonfly Capital Views Premium Membership
Sign up here to get deeper analysis and nearly 50 trade ideas every week.
If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
- Top Trade Ideas for the Week of January 26, 2015: The Rest
- Top Trade Ideas for the Week of January 26, 2015: The Rest Premium
- Top Trade Ideas for the Week of January 26, 2015: The Best
- SPY Trends and Influencers January 24, 2015
- Macro Week in Review/Preview January 23, 2015
- Premium Earnings 1-23-15
- The Longer Outlook in ….. The Nikkei Average
- Assembling a BioTech Trade in Assembly Biosciences
- Premium Earnings 1-22-15
- The Longer Outlook in ….. US Treasuries