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Professional Diversi (IPDN): Pulling the Layers Back For The Chaikin Oscillator

Wall Street pre-market Wednesday was cautious, with US stock market index futures pointing to an opening bell roughly even with Tuesday’s close, with the tech-centric Nasdaq possibly opening lower. European bourses were choppy with Frankfurt in the green, and Asian exchanges closed mixed. Markets have eyes upon the 2 pm ET rate announcement from the US Federal Reserve, and also Fed forecasts of economic growth, inflation and interest rates, which may provide clues if three rather than two rate increases will follow in 2018. Facebook (FB) faces ongoing criticism and lawsuits regarding sale of user data. Bitcoin was trading at $9,070, oil was at $63.90 and 10-year US Treasuries offered 2.88%. 

Tracking the indicators for Professional Diversi (IPDN), we can now see that the Chaikin Oscillator reading is below zero. Tracking this signal, traders may be watching for signs of a possible bearish trend forming.

Often times, investors are faced with challenging portfolio decisions. Maybe there are a few stocks that have outperformed expectations by a large margin. Investors may be hesitant to exit a position with the fear that the stock may have much more room to run. Investors may have to decide if the time is right to cash in and take some profits, or hold out for further gains. On the other end, investors may have a few duds in the portfolio. Cutting ties with certain underperformers can be a tough decision. It may be hard for an investor to sell a position that they thought for sure was going to pan out and provide gains. Being able to detach from a certain position may help ease the possibility of even more frustration later down the line if the stock doesn’t bounce back.

Investors and Traders using technical analysis to review stocks may be focusing on the ATR or Average True Range. Currently, Professional Diversi (IPDN) has a 14-day ATR of 0.21. The Average True Range is an investor tool used to measure stock volatility. The ATR is not used to figure out price direction, just to measure volatility. The ATR is an indicator developed by J. Welles Wilder. Wilder has developed multiple indicators that are still quite popular in today’s investing landscape. The general interpretation of the ATR is the higher the ATR value, the higher the volatility.

Taking a closer look from a technical standpoint, Professional Diversi (IPDN) presently has a 14-day Commodity Channel Index (CCI) of -198.51. Typically, the CCI oscillates above and below a zero line. Normal oscillations tend to stay in the range of -100 to +100. A CCI reading of +100 may represent overbought conditions, while readings near -100 may indicate oversold territory. Although the CCI indicator was developed for commodities, it has become a popular tool for equity evaluation as well.

For further review, we can take a look at another popular technical indicator. In terms of moving averages, the 200-day is currently at 2.65, the 50-day is 1.43, and the 7-day is resting at 1.31. Moving averages are a popular trading tool among investors. Moving averages can be used to help filter out the day to day noise created by other factors. MA’s may be used to identify uptrends or downtrends, and they can be a prominent indicator for detecting a shift in momentum for a particular stock. Many traders will use moving averages for different periods of time in conjunction with other indicators to help gauge future stock price action.

Currently, the 14-day ADX for Professional Diversi (IPDN) is sitting at 15.19. In general, an ADX value from 0-25 would indicate an absent or weak trend. A value of 25-50 would support a strong trend. A value of 50-75 would identify a very strong trend, and a value of 75-100 would lead to an extremely strong trend. ADX is used to gauge trend strength but not trend direction. Traders often add the Plus Directional Indicator (+DI) and Minus Directional Indicator (-DI) to identify the direction of a trend.

Investors may be watching other technical indicators such as the Williams Percent Range or Williams %R. The Williams %R is a momentum indicator that helps measure oversold and overbought levels. This indicator compares the closing price of a stock in relation to the highs and lows over a certain time period. A common look back period is 14 days. Professional Diversi (IPDN)’s Williams %R presently stands at -98.86. The Williams %R oscillates in a range from 0 to -100. A reading between 0 and -20 would indicate an overbought situation. A reading from -80 to -100 would indicate an oversold situation.

Traders might be paying extra attention to the technicals as they look to spot buying opportunities in the stock market. Because there are so many different strategies that traders can use, it may be difficult to pinpoint the correct avenue. New traders might choose to focus on one or two main indicators when just starting out. With time and experience, many traders will use a combination of various indicators when setting up their persona charts. It may be wise for traders to remember that what has worked for someone else in the past may not work for them in the future.   

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