| ATAA Blast! Newsletter #174 – November 2024
| Dear ~~first_name~~
Welcome to the November edition of the ATAA Blast! Newsletter. In this edition you can see the following, with links for an easy and speedy go-to to the relevant section below:
- Urgent and important notice: The ATAA 2024 AGM meeting will be held online on Wednesday this week 13 November, and all ATAA members are invited to participate. See more information in specific emails sent to our emailing list recently (the most recent notice was sent 11 November). Members can login to the website and view the 2024 AGM Documents. You can also navigate to these documents using the website menu: Resources > Resource Library Folders > Association Documents > Annual Reports.
- ATAA National President's Update for November with comment on: the recent ATAA Online Conference, the upcoming AGM this Week, information on the ATAA website Forums, and an appeal for more volunteers to help run our very successful ATAA.
- ATAA Latest Website Resource Library updates for the latest month - With an update on the immensely useful and growing ATAA Resource Library, including the now hundreds of video session recordings from the SIGs and network groups.
- Online Discussion Forums - This resource is now growing in popularity in the ATAA website (for ATAA members only - login is required).
- ATAA National Board Update - The latest news from the national board of directors.
- List of all of the ATAA Chapters, SIGs and Network Groups - More opportunities for the ATAA members for networking and learning.
- The ATAA Conference(s) update - A report on the recent very successful ATAA Online Conference.
- Updates from the ATAA Chapters and SIGs: Canberra, Melbourne - or at least from those that have submitted content. Thank you to: Mark (Canberra) for your ongoing contributions.
- IFTA information update: Latest information from IFTA, including the upcoming SEEMT - Investor Insight Summit from our sister IFTA member society in Europe.
- TECHNICAL ANALYSIS article - In this technical analysis article this month I continue the item on Divergence from the June edition of the Blast!
- Detailed benefits for ATAA members.
WARNING: When testing and proof reading this edition of the newsletter I noticed that in Google's Gmail that the Gmail Inbox shows a portion of this November edition, and some of last month's October newsletter. At this stage I am not sure of the best way to work around this issue.
As the national Marketing Director, I am still including key marketing phrases in this Blast!:- the ATAA Tag line in blue below, and the ATAA Elevator Pitch also in blue at the bottom of this email. Feel free to use these in your own correspondence to help encourage new members, and of course to remind existing members of why they are ATAA members.
I do hope you find this Blast! newsletter useful and interesting reading; but do feel free to tell us what you really think, and how we can improve it.
ps: Apologies continue for any odd formatting that you might find which I cannot resolve - font size or line spacing etc - as these seem to be oddities in our CE email editor.
Robert B Brain
Blast! Newsletter Editor
ATAA Marketing Director
(and ATAA Life Member)
| The ATAA is the knowledge network
for successfully using technical analysis
in financial market trading and investing
|
National President's Update – November 2024
The ATAA 2024 Online National Conference was held online on Saturday October 19. This was a very successful event with excellent presentations, high participation from members (and a significant number of non-members) and smooth implementation on the day. Congratulations to the National Conference Working Group for putting on such a great event.
The ATAA AGM is this week – on Wednesday evening the 13th of November 2024. This will be an opportunity for the national board to report to the members on the 2023-24 financial year and to receive any feedback directly from the members. We have one nomination for a new member of the board. However, there will still be some open positions on the ATAA board, and nominations to fill those positions on an ad hoc basis are always welcome. At present, there are some great initiatives that the board is undertaking, and these will progress faster with more directors to contribute to the work.
I want to highlight the ATAA Forums which are available on our website. These are a great tool for members to communicate and network amongst themselves on topics of interest. I would encourage use of these tools that are there for your use. Please keep in mind that if you mention a commercial product in the forums, and you have any official connection with that product, you will need to declare your interest, for the sake of transparency.
I wish to stress again that the ATAA is a volunteer organisation, and it depends on its members to donate some of their time to fulfil its mission. I want to thank all members who contributed to this end in their role as office bearers in the past, whether it is on our Chapter committees, the SIGs, the ATAA Board or other positions. If you have the time and expertise to help the ATAA better serve its members, please volunteer at whatever level works for you.
Jim Haralambidis
ATAA National President
| ATAA Website - Resource Library Updates - recordings from October 2024
You might have noticed that our ATAA Resource Library now has various presentations and recordings going back to 2008. You can drill down on these using the website menu: Resources > Presentations by Date. And alternative way to find something specific on a particular topic is to search the library using the menu option: Resources > Search Resource Library.
In case you've missed the materials recently added to the Resource Library, here's a brief list of those added in the latest month:
- 10 October - Melbourne chapter hybrid meeting - Thomas Atkinson: Unlocking Smart Money Secrets: How to Trade in Volatile Markets, and Robert Brain: Should I have bought this stock last month?
- 21 October - Sydney chapter meeting - Graham O'Brien - Exchange Traded Options, and Mary McNamara - A deep dive into the markets.
- Saturday 19 October - ATAA 1-day Online Conference - session recordings from seven conference speakers (access restricted to the paying conference participants).
All of these items can be found from the ATAA website menu: Resources > Presentations by Date. Make sure to browse the earlier recordings in the Resource Library, because you might never know what you've been missing. And you can also search the Resource Library by keyword.
| | SIG and Network presentations in the Document Library - There is a growing collection of session recordings and other materials in a section of the ATAA website Resource Library. The latest one (from the Forex Network) can be found by following the menu (as shown in the screenshot below): Resources > Resource Library Folders, then expand the tree hierarchy under the Document Library heading: Member Resource Library > Presentations by Group. | | Presentations by Group - Session recordings for some of these ATAA groups can be found on the website:
- Bigalow Network
- Forex Network
- MEL Quant Traders SIG
- FX SIG
- Holy Grail Trader SIG
- MetaStock User Group SIG
- Technical Analysis Chat SIG.
| | | UPDATE:- More information about Chapters and SIGs? - One thing that has been missing from our ATAA website is some permanent information about our Chapters and Special Interest Groups (SIGs), including an overview of any speciality that they provide, and the meeting frequency, day of month and time of day. We are in the process of gathering this information, and it will be up on the website in the very near future.
Robert Brain
(Marketing Director) | ATAA Online Discussion Forums - Many of our SIG groups and Network Groups have discussion topics in the Online Discussion Forum. You can sign-up to receive update emails on specific topics as they are posted. Login and visit the ATAA Forum to see more details.
The most active forums currently include: Bigalow Network, MEL Quant Trader SIG, Adelaide Chapter, Brisbane Chapter, "Trading Strategies and Systems", "Indicators and Charting", "Trading Software and Tools" and "RealTest coders Workshop" - just to name a few.
Check out the growing list of online discussion forums on the ATAA website on a range of T.A. and trading topics. And feel free to start a new discussion topic. The link to access the forum (in the website menu) is enabled after you login to the ATAA website.
Robert Brain
(Marketing Director) | |
ATAA National Board updates
| | |
Meeting Visitors - First Time Free - for Christmas meetings?
As the Christmas period approaches, you might want to encourage visitors and non-members to attend your December meeting. With carefully planned details and well-worded promotions, you might be able to attract a few new faces.And don't forget that first-time visitors to Chapter meetings are allowed to attend for free. Non-members are always welcome to attend ATAA meetings, and pay the $40 Visitor Fee. This is normally done online in advance when you register to attend the meeting. However, if you have not attended an ATAA meeting in the past, you are welcome to attend your first meeting for free - and preferably register on the ATAA website so that we will be expecting you as a special first-time visitor.
| ATAA Marketing Working Group Update
| |
The Marketing Working Group hasn't met for a couple of months, but things are still ticking along in the background. We currently have a new pull-up banner on order with a new QR code included on the banner. We're hoping it will arrive in time for this Thursday's Melbourne chapter meeting in South Yarra.
Robert B Brain
ATAA Marketing Director
| | | | The official ATAA email signature block. Are you using this email signature block yet? if not, why not? It's easy to download it and set it up as the footer in each of your new email messages, and in your replies to emails. This jpeg file (shown herewith) is available for ATAA members to download from the "Resource Library", and then include it in your own email signature block at the bottom of your emails. To find this file and download it, login to the ATAA website and use the menu option: Resources > Resource Library Folders > Association Documents > Marketing. | | | |
ATAA Conferences
Working Group
| | |  | ATAA 2024 Multi-Speaker Online Conference Wrap Up
Our recent online conference was both a logistical and financial success.
We were very pleased with the production values of the conference. Everything ran to time, with no technical delivery issues. The speakers and content were all of a very high standard.
Thanks to everyone who took part. We had 84 registrants, which was a great turn out. Thanks also to our conference sponsors, Metastock and GoMarkets (check out the links for their special offers which are still available!).
The feedback from conference attendees was overwhelmingly positive. Over 90% of respondents to a post-conference survey felt the conference was very good or excellent, while 86% would recommend it to others, and 80% would be keen to attend another similar online conference.
ATAA 2025 In-Person Conference
We plan to hold an in-person conference in Melbourne in October 2025. We have begun compiling a venue specification which will go out to tender next week. We aim to have the venue locked in before Christmas.
Alan Clement
ATAA (Conference) Director
| CHAPTER and Special Interest Group (SIG) news and updates
| ATAA Chapters, SIGs and Network groups
For the benefit of ATAA members everywhere, the ATAA has a number of: Chapters, and Special Interest Groups, and Network Groups. Current financial members are free and welcome to participate in any of these. We are hopeful that all of these groups will submit some information for publication in the Blast! News from time to time, to help our hundreds of readers understand more about the opportunities and benefits for ATAA members.
For the latest meeting information, check the ATAA website for details, and also scroll down the website home page to see the latest announcements, presentations and updates to the resource library.
| | ATAA Chapters (alpha order) meeting monthly
- Adelaide
- Brisbane
- Canberra
- Melbourne
- Newcastle
- Perth
- Sydney
| | SIGs and Networks (and contact names)
- Melbourne Quant SIG (Jim Haralambidis)
- RealTest Coders (online) Workshop (Chris Meakin, Robert Grigg)
- Bigalow Network (Romy Baker)
- Forex Network - FN (Romy Baker)
- MetaStock Users SIG (Jerry Bongard)
- FX SIG (Mike Smith)
- TA Practice SIG
See the ATAA website for latest information.
| | | Bigalow Network and
ATAA Forex Network (FN)
| |
The Forex network - Continues to meet. Recordings of meetings can be found in the resource library.
You are welcome to join us - If anyone would like to join the Bigalow or Forex Network meetings, please email the undersigned, Romy Baker. We would love to hear from you if you are interested so, please send us an email, or phone us.
Looking forward to hearing from you.
Romy Baker
ATAA Sydney Chapter
0414 554 967 |
The Canberra Chapter continues to have a small and dedicated in person following of around 10-12 members meeting in person at Eastlake Football Club.
In October, Bruce Taylor provided his popular ASX review looking at the macro ASX200 view and the movements of some blue-chip local stocks. Chris Meakin provided an update on the rotational, systematic variations on Ray Dalio’s All Weather Portfolio and we had an update on the local stock picking competition by Gabriel Spacca.
Our October in-person meeting on Tuesday 15 October saw the return of the popular ‘This is what I have recently traded’ series incorporating an explanation of how the trades were set up, executed and completed. Presenters included Gabriel Spacca, Chris Meakin and our Options expert and covered discretionary, systematic and options trading.
These sessions continue to resonate with members present as the trades are current and quickly relatable and relevant. The strategies also demonstrate different technical approaches to TA, different thinking frameworks towards the market and different indicators and software used.
Our November meeting includes our Canberra Chapter AGM and three summary presentations of the 2024 Conference presentations. These include: Multiple Timeframe Analysis with VWAP, Trader’s Roadmap to Success and Investing Psychology secrets.
We will be meeting in the Boardroom rather than the Duffy Room as a trial run for 2025.
Good trading and good health,
Mark Gleeson
ATAA Canberra Chapter President
[The Canberra Chapter generally meets on the third Tuesday each month.]
| At the monthly Melbourne Chapter hybrid meeting in October Robert trialled a new meeting segment entitled: "Should I have bought this stock a month ago?" A very similar exercise was included in the October edition of the Blast! news. In case you missed any of this you can see the Blast! news article in the Resource Library - use the website menu: Resources > Blast! Newsletters. And you can see the chapter hybrid meeting video recording in the Resource Library using the menu option: Resources > Presentations by Date.
In the November chapter hybrid meeting later this week (Thursday 14th) we will be trialling another variation on presentations with Robert Grigg presenting a session (it will be an interview-type session) on "My trading History and Experiences with IFTA", and then Jim Haralambidis "Should I sell or should I hold now? An interactive exploration of attitudes to selling losing trades".
As for the December meeting, the chapter council/committee will be planning something special, so reserve the date (Thursday 12 December) and stay tuned for details.
We have continued to run in-person hybrid meetings on the second Thursday each month, with the invaluable networking from 5.15pm to 6pm (including free finger food), then the broadcast session 6-8pm, followed by further networking and guest speaker mingling over dinner after 8pm. The broadcast segment is usually recorded and uploaded to the ATAA website soon after. If you missed the session, you can view the video recording; but you would have missed out on the great networking opportunities and the exchange of trading tips and knowledge that only happens in the room.
All ATAA members who attend our meetings are given a "Door Prize" raffle ticket, with the winning tickets drawn during the mid-session break (when we change-over the speakers). You see, we still have a truck-load of pre-loved trading and technical analysis books to give away at our meetings with more coming, and these are used as the Door Prizes in the Member give-away. And some of these books are absolute gems - for free!
Don’t forget that public transport (tram) runs past the hotel front door, and there is ample car parking around the corner.
Robert Brain
ATAA Melb Chapter President and interim Secretary
(for the Council team: Paul Ash, Jim Haralambidis, Keith Mundy, Tony Hambling, Tony Leonard, Robert Grigg). | Sydney Chapter meetings
The Sydney chapter continue to have monthly online meetings, and a bi-monthly get-together over dinner. Stay tuned for more details about upcoming events.
Sydney Chapter Council
[The Sydney Chapter normally meets online on the third Monday of each month, plus a bi-monthly dinner]
| Don't forget, we have a total of seven chapters around Australia, including: Brisbane, Perth and Newcastle as well as several Special Interest Groups (SIGs) in which members can participate. You can see a list of the seven chapters and their office-bearers on the website - use the menu option: ATAA Overview > Current Office-Bearers > Chapter Councillors > Subcommittees. See the ATAA website for latest meeting and event details.
- Adelaide Chapter generally meets in-person on the third Wednesday of the month.
- Perth Chapter generally meets on the third Thursday of the month.
- Brisbane Chapter generally meets... second Saturday of the month? TBC
- Newcastle Chapter generally meets ... Saturday in the month? TBA
- MetaStock Users SIG - Contact Jerry Bongard, jerry.bongard@ataa.asn.au
- RealTest Coders Workshop (sub-group of the Quant SIG) - Meets online, generally on the second Monday of each month at 8:00 pm. EST (to give members in western states a better chance of attending). SIG Coordinators: Chris Meakin and Robert Grigg.
| SEEMT Investor Insight Summit
The South and Eastern Europe Market Technicians Association (SEEMT), an IFTA member society, invites you to its Investor Insight Summit via Zoom on 15 October 2024, beginning at 0900 CET (Central European Time). This event is FREE for IFTA Member Colleagues. For more information and to register, please click the links below:
About SEEMT
SEEMT is the leading organization for technical analysis in the Balkan region. It promotes the highest standards of professional excellence and cultivates a vibrant community of technical analysts. SEEMT aims to advance the study and practice of technical analysis while supporting the professional development of its members.
| About IFTA (International Federation of Technical Analysis) - It is the umbrella organisation for Technical Analyst societies around the world.
IFTA webinars: See the latest information about up-coming and past webinars on the IFTA website. | The IFTA Journal 25 is now available.
We are pleased to announce that the 2025 IFTA Journal is now available for viewing and download from the IFTA website. "I hope you enjoy reading the Journal and look forward to the many small discussions that regularly arise from this publication." - Dr. Rolf Wetzer, CFTe, MFTA, Journal Editor.
”You can't put a limit on anything. The more you dream, the farther you get.” - Michael Phelps
Inside this Issue (113 pages and 16 MB file size):
Articles
- Linton Price Targets, By David Linton, MFTA.
- Prediction is Very Difficult: Especially if It's About the Financial Markets, By Davide Pandini, Ph.D, MFTA, CFTe, CMT, CSTA.
- Trend-Adaption of Moving Averages (TAMA), By Dr. Patrick Winter
MFTA Papers
- How the Deltachart Order Flow and Divergence Delta Candles Work Together to Forecast the Price Movement in High Volatile Market, By Nashwan Mohammed Al-Thawr, MFTA.
- Using Renko Charts for Noise Reduction and Directional Insights in the US Equity Market: A Multi-Dimensional Approach Integrating Investment Factors, Sector Analysis, and Volatility Filters, By Loïc Bellina, CFTe, MFTA.
- The Similarities in Various Markets and Timeframes, Through Quantitative Comparison Methods, and Its Application to Trading Systems, By Nobuaki Kakimoto, CFTe, MFTA.
NAAIM Paper
- Chicken and Egg: Should you use the VIX to time the SPX? Or use the SPX to the VIX?, By Robert Hanna.
Book Review
- Technical Analysis for the Trading Professional, 2nd Edition, by Constance M. Brown, Reviewed by John Gajewski.
| IFTA and ATAA members - ATAA members are automatically affiliate members of the International Federation of Technical Analysts. ATAA membership gives you access to IFTA resources including: certification programs, educational events and networking opportunities, including participation in the IFTA Conferences. The information below is the latest update from IFTA.
IFTA Update (quarterly newsletter) - The IFTA Update is a quarterly newsletter that is available to members of the ATAA.
| Join the ATAA to improve your understanding of how to
invest or trade successfully in the financial markets
focusing on the correct use and application of Technical Analysis
| Bearish (and Bullish) Divergence - Part 2
| Back in the June 2024 edition of the ATAA Blast! news I wrote about Divergence - both Bearish and Bullish. If you missed that article you can find it in the ATAA website Blast! archive using the website menu options: Resources > Blast! Newsletters. Don't forget that both bearish and bullish divergence can be useful to spot on daily or weekly charts because it can forewarn of a possible trend reversal - due to underlying weakness, or strength - that is developing in the market (when studying a market index), or in a security.
In this month's Technical Analysis article, this Divergence Part 2 picks up where the June article finished - with details for some of the T.A indicators that are useful for spotting divergence.
| Which indicators?
In the examples in Part 1 (in the June edition) we have used both the Momentum indicator and the RSI indicator. The notion of divergence can also be observed with a number of other indicators. One reference states that there are four specific indicators which have proven to be valuable:
- Commodity Channel Index (CCI)
- Slow Stochastic
- Relative Strength Index (RSI)
- Moving Average Oscillator.
Other anecdotal evidence suggests that there is also reasonable usefulness with the following indicators:
- Momentum (both 14-period, and 28).
- MACD.
| | With reference to the figure at right, note the following observations regarding a number of indicators that can signal divergence:
- The upper pane of six panes in this chart is the daily price chart of CBA from late January to March 2003, which shows the last low (a Lower Low) before a bull run that lasted for several years.
- The second pane is CCI (Commodity Channel Index) and shows (slightly) Higher Lows in mid-Jan, mid-Feb and mid-March. These can be interpreted as suggesting higher underlying strength in the stock and a possible uptrend - bullish divergence.
- The next pane is RSI showing the RSI moving from 50 down to below 30, then up and down a couple more times with two successive Higher Lows (20 February, and 13 March) to suggest underlying strength in the stock - bullish divergence.
- MACD (ignore the dotted Signal line in this example) - shows a low on around 20 February, followed by a Higher Low on about 17 March - bullish divergence.
- The second bottom pane is 14-period Momentum showing a number of low points from 29 January to 27 February, followed by a clearly Higher Low on 13 March - bullish divergence.
- The bottom pane is Twiggs Money Flow showing a Low on 20 February, followed by an uptrending TMF thereafter.
|  | | | Conclusion? Several indicators can be used to flag possible divergence. Some will show divergence more clearly than others, and some will not show it at all. Perhaps the best way to accommodate this is to view price charts with a couple of your favourite indicators, and understand that divergence might exist if only we use the right indicator in the right situation.
Periodicity and fair warning
It can be seen in the examples here so far that viewing either daily or weekly charts covering a period of about 3 months can provide ample warning of a potential change in trend. Even so, the notion of divergence also works well in other periods (eg. both monthly and intraday charts).
Levels of divergence — Class A, B, C
For some people, divergence is just divergence. However, some people might be interested to understand that there are three “classes” of divergence – Class A, B and C – as explained here.
Differentiating divergence according to class is classifying the divergence according to its level of strength. Class A divergences are considered the strongest, with Class B exhibiting less strength, and Class C the weakest. It is believed that Class A divergences provide the best trading opportunities.
The key difference between each Class is whether the price can make new levels, or just equal previous levels, while the indicator shows divergence, or vice versa with the indicator making new levels while the price can only equal previous levels.
The weekly price chart below of the XAO index is a good example of Class A bearish divergence. It clearly shows the index making Higher Highs while the Momentum indicator is showing a Lower High. The Class A bearish divergence can often signal a sharp and significant reversal to the downside.
|  | | The weekly price chart of the XAO index below is a good example of Class A bullish divergence, clearly showing the index making Lower Lows with the indicator making Higher Lows. These are often the best signals of an impending sharp rally. | | Class B divergences are when the price can only equal previous levels as in a Double Top or Double Bottom chart pattern, while the indicator achieves new levels. In the weekly price chart at right (CPA — Commonwealth Property), we can see the stock is making a multiple top continually hitting resistance at about $1.70 from June to December 2007. During this time, several indicators made Lower Highs, including the MACD shown in the lower half of this chart.
| | | | Class C divergences occur when the price achieves new levels, but the indicator can only attain the levels reached previously. It is said that Class C divergences are most indicative of a stagnating market, with neither the bulls nor bears dominating the market.
The weekly chart of the XAO index at right shows an example of bullish Class C divergence where the XAO is making Lower Lows in late 2008 and early 2009 (which we now know as the tail end of the GFC bear market); but the Twiggs Money Flow indicator (in the lower pane) is sitting on a support line at about -15%. This was suggesting that earlier weakness in the index is dissipating, and that the index could be seeing some strength building.
| | | More information about the classes of divergence is available online here:
| Confirmation
Take care! — We can see in the examples above that the presence of divergence is not a definitive warning of an impending trend change. In fact, it can be said that divergences can be considered normal in a strong trend. And they sometimes result in no trend change at all What they do do is they wave the warning flag that a trend change is possible at some stage in the near future (but not probable). And the time frame might be within days, or it might not be for weeks, or even a few months. The key point is that it is possible so we shouldn't be surprised.
The usefulness of divergence is increased if we can utilise another technical analysis tool to confirm a potential signal — such as a candlestick pattern, or chart feature such as a chart pattern, or price gaps, or even volume. It is important to keep an eye out for any or all of these situations.
Hopefully this exercise was useful for you.
Author: Robert B Brain
(c) Copyright, Brainy, November 2024 | ATAA Member Perks and Benefits
| If you're not an ATAA member, and you are considering joining, you might be interested to know there are many good reasons to sign-up, including:
- Invaluable education opportunities (with discounts for members);
- Huge and extensive Resource Library (access for members);
- Networking opportunities - meet with like-minded peers for trading and investing discussions;
- Special Interest Groups (SIGs) (only for members) - there are several;
- News and information;
- Online Forums;
- Annual ATAA Conference (discounted for members).
| As I said at the top, my apologies continue for any odd formatting that you might find herein - font size or line spacing, etc - but these seem to be oddities in our CE email editor which are very elusive.
I do hope you have found this edition of the Blast! Monthly News interesting and useful. it took me longer than expected to compile this edition, but then there is a lot more news and information than normal. If not, or if you have any feedback, please feel free to email me directly.
Robert B. Brain
Blast! Newsletter Editor
| |