Hawk’s Scan Sentry Report February 6

Today I want to show you another set-up I like to look for, and offer a few examples of it from current charts. To find the early identification of a bullish trend I look for the Arps Triple Trender to turn bullish (below the price) on all three Trenders and combine that signal with a cross above the zero center-line of the Radar3 Trend Strength Index. It’s pretty simple really. The Triple Trender identifies the orientation of the trend across three different abstract time-frames; while the Radar 3 Trend Strength Index confirms the direction of the trend and identifies the strength of it. This works even better when supported by a divergence in the Radar1 Fear Greed Indicator or the Radar2 Price Leader. You should put your stop on the outside of the long-term Trender because the price will often pull back into the short-term or medium-term Trender before really moving in your direction with conviction . This is a good set-up in both bullish and bearish directions…. But the markets are so bullish right now that it is currently a bit difficult to find this set-up as a short-selling signal.

I am currently bullish on the medium and long-term orientation of the American markets these days for reasons political and historical as well as technical. But, as always, I am preparing myself with trading options in both directions. Here is a sampling of a few that are on my watchlist this week with examples from the set-up described above.

_____Longs_____

MA

(A good example of the set-up described above. Note the divergence in the Radar1 Fear/Greed Index before the breakout).

CDNS

(Here’s one that shows the Triple Trender and Radar 3 signal nicely. I expect it to pullback to resistance around $10.80 and fill the gap ).

KSS

(This one is NOT confirmed by the Radar 3 Trend Strength Index as described above, but is a bullish Triple Trender preceded by a very nice divergence ).

_____Shorts_____

KMX

(Here’s a bearish example of the set-up described above. As it is already close to resistance at $29.50, I would still look for a pullback into the Triple Trender for a good entry price).

LINE

(Here’s a pullback into the short Trenders with a newly bearish Radar3 Trend Strength signal. Note the Radar2 Price Leader crossing under its center-line while the downward pointing blue bars of the Radar3 Trend Strength tool show a pullback indication).

NEM

(I like the Pullback 23 signal in the downtrend here ).

May the trend be with you,

Hawk

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