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Monday, May 22, 2017 - Weekly e-Newsletter - Issue No. 756

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Economic Calendar
Date
ET
Release
For
Consensus
Prior
May 23
10:00
New Home Sales
Apr
NA
621K
May 24
07:00
MBA Mortgage Purchase Index
05/20
NA
-4.1%
May 24
09:00
FHFA Housing Price Index
Mar
NA
0.8%
May 24
10:00
Existing Home Sales
Apr
NA
5.71M
May 24
10:30
Crude Inventories
05/20
NA
NA
May 25
08:30
Initial Claims
05/20
NA
NA
May 25
08:30
Continuing Claims
05/13
NA
NA
May 25
10:30
Natural Gas Inventories
05/20
NA
NA
May 26
08:30
Durable Orders
Apr
NA
0.7%
May 26
08:30
Durable Goods –ex transportation
Apr
NA
-0.2%
May 26
08:30
GDP - Second Estimate
Q1
NA
0.7%
May 26
08:30
GDP Deflator - Second Estimate
Q1
NA
2.3%
May 26
10:00
Michigan Sentiment - Final
May
NA
97.7
 
This Week in History

5/22/1824 - After much debate and politicking, Congressman Henry Clay was able to get his proposed tariff through the House of Representatives

5/23/1946 - Rairoad Trainmen and Locomotive Brotherhoods started a strike to improve wages after their return from WWII; workers got their wage increase

5/24/1915 - Pan-American Conference took place in DC; its goal was to promote foreign traden and investment to make the US a leader in the world economy

5/25/1805 - Strike by Philadelphia cordwainers (shoemakers) ended marking first timeemployer sought help from courts to end a strike

5/26/1994 - President Clinton renews trade with China which prreviously had been suspended for alleged human rights violations

5/28/1985 - Brokerage E.F. Hutton & Co entered guilty plea to charges that it carried out large check writing scam

This Week’s Featured Indicator:
CHANNELS

A channel is the space between a plotted area of support and resistance. Channels come in three forms: horizontal, ascending, and descending. In the case of ascending or descending channels, trend lines are drawn across both support and resistance areas. Channels are sometimes used to enter or exit trades at support or resistance levels. Channels are also used to interpret potential breakdown of a trending movement when price violates channel support or resistance in the direction contrary to the current trend.

PROS:

  • For trending markets, channels provide a frame in which trending price movement can be observed and analyzed.
  • Because channels (like trend lines) can be extended beyond the current market price, it can be used to anticipate potential areas of support and resistance.

CONS:

  • Price can violate a channel line and move back toward the direction of the trend (sometimes causing channels to be re-drawn if violation highs and lows can be aligned).
  • There are potentially multiple channels one can draw within a given trend which can be confusing for many traders.
  • Trajectories of ascending and descending channels can change often and at different durations.
 

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