Weekend Update - COMPQ, BPCOMPQ, NAHGH, & TRAN

The Nasdaq Composite (COMPQ)- Weekly Chart
The weekly chart of the Nasdaq is bullish. As you can see by looking at the chart, the COMPQ has broken out of an ascending triangle. This week the COMPQ had a bullish outside reversal on high volume. The indicators and oscillators are bullish.

The Nasdaq Composite Bullish Percent Index (BPCOMPQ)
Let me ask you this question. Why does the BPCOMPQ index keep making new highs on broader market down days? The answer is this, because more stocks made new 52 weeks highs than they made 52 week lows. The BPCOMPQ is making new highs without the COMPQ which is bullish. Again, indictors and oscillator are bullish.

Nasdaq-New Highs (NAHGH)
The NAHGH has broken out. There are more new highs now than a year ago. The BPCOMPQ and NAHGH are performing better than the COMPQ. Higher highs are bullish.

The Dow Jones Transportation Average (TRAN)- Weekly Chart
The TRAN is in a reverse symmetrical triangle pattern. It is now making new all time highs. Short term anything is possible. However, medium term this is bullish. Indicators and oscillators are bullish. I am still neutral however, because I am still waiting on the SPX to catch up. Stick with the trend until it changes. Notice that the stochastics are bull flagging. I believe the TRAN will follow the DAX and the CAC. So many sectors are now reaching new all time highs. I remain in the bullish camp until proven otherwise.

Engulfing Line (Bullish) Short-term Pattern

Implication

An Engulfing Line (Bullish) indicates a possible reversal of the current downtrend. This pattern is an indication of a financial instrument's SHORT-TERM outlook.

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Description

The Engulfing Line (Bullish) occurs when the Real Body for a price bar is larger than the Real body for the previous price bar. In addition, for an Engulfing Line (Bullish), the Real Body of the previous session must be Black (close lower than open) and the Real Body of the second session must be White (close higher than open).

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Criteria that Supports

The difference in the sizes of the two Real Bodies can be an important indicator of the signifiance of the Engulfing Line. If the Real Body of the previous session is substantially smaller than the Real Body of the following session then this pattern should be considered more significant. The greater the size difference the more significant the formation.

The longer and higher the inbound trend that leads into the Engulfing Line, the more significant the pattern.

Look for heavy volume in the following session. A noticable increase in volume from the previous few sessions is a strong indication that this pattern is more significant.

If the following session "engulfs" more than one session's Real Bodies this pattern is very significant.