Thursday, October 16, 2014

TD Ameritrade (NYSE: AMTD) Watch This Broker's Chart Like a Hawk for a 'Buy' Signal

No doubt, the stock market has been challenging in the past few weeks. Although it started to back down from all-time highs in September, the pace accelerated to a near panic in October, sending all major indices below important trendlines and moving averages.
Most stocks sank with the market, yet some were in rather good shape technically before the stampede commenced. TD Ameritrade (NYSE: AMTD) is one stock that seemed to get pulled down much further than its chart suggested it should.
While it's true that in chart analysis, whatever the stock does on the charts is exactly what the market intended, some indicators have already dropped to excessive levels.
AMTD Stock Chart
Stochastics, for example, which measures a stock's placement in its recent range to find overbought and oversold conditions, is now quite oversold. In fact, it is reading in the single digits. The commonly used parameters of a 14-period range with three-period smoothing returned a reading of four in a scale of zero to 100. Anything below 20 is considered oversold, so this is indeed extreme. (more)
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