Good evening StockBandits!
The indexes trended steadily lower on Friday, closing out the week with another day of distribution. We saw the same thing take place on Tuesday, although some Wednesday stabilization and a Thursday bounce seemed to temporarily erase concerns. However, stocks headed into the weekend with buyers notably absent.
We still have trading ranges in the indexes (which we’ll take a look at shortly) that deserve our respect until broken, but there are a few hints that are worth taking notice of right now. The first is the added volatility we’ve been seeing. Not only is the VIX on the rise, but we’re seeing wider day-to-day trading ranges, and that’s a shift from the quiet upside which was so prevalent recently. Another thing I’m noticing is the increased frequency of distribution days. Two weeks ago on a Friday, stocks ended the week with steady, heavy selling. That also happened this past week on Tuesday & Friday, and that action gives a bit more of a toppy look to the daily charts of the indexes. An actual breakdown will have to occur before there’s a technical reason to truly sell this market, but for now there are plenty of reasons for caution.
Heading into this week, we have a number of companies still reporting earnings, placing great emphasis on the timeframes for which new trades are initiated. I see several setups I like here, but will as usual avoid scheduled fundamental news like earnings, so for Monday I’ll be focused on shorter timeframes. Let’s take a look at the index charts and then get to some individual names of focus for Monday’s trading session. By the way, I’m doing some travel the next couple of days but will return to the video format a little later this week.
Please leave your comments and/or questions below if you have any, I always enjoy the interaction.
Swing Trading Candidates:
NONE TONIGHT.
Day Trading Candidates:
GET has been holding up well and has been able to put in some rest in recent days. Well-defined resistance is just overhead, so if this one can push through the $34.65 zone on Monday I’ll be a buyer for a day trade. Earnings are due out on 5/4, so this will only be a day trade for me.
GFI is just now pushing through previous highs and has some more room to run higher if price can accelerate. I’ll be a buyer for a day trade if this one can clear $13.60 on Monday. Earnings are scheduled for 5/7, so this will only be a day trade for me.
EXH has pulled back slightly within its uptrend, and has done so on light volume. That points to very little selling taking place at these levels, opening the door for another push higher soon. If this one can clear $29.60 on Monday, I’ll be a buyer for a day trade. Earnings are scheduled for 5/7, so this will only be a day trade for me.
TIE struggled to really break out a few weeks ago as it contended with prior resistance. That has led to what now appears to be an inverted saucer-like pattern, which may be a topping process for this stock. Prices are now resting on short-term support, which if broken at $15.30, would open the door for more downside. Earnings are due out on 5/4, so this will only be a day trade for me if it triggers on Monday.
MTW sold off quickly a few sessions ago, and since then price has struggled to bounce. There’s a small rising trend line which is starting to emerge on this chart, which if broken, would allow for more selling. I’ll take it for a short sale as a swing trade it if undercuts that trend line at $13.90.
LBTYA rolled over recently and has been unable to bounce. Instead, this chart now has a bear pennant pattern which would be confirmed with a break below the $27.20 level. I’ll be looking to short sell this stock as a day trade if that lower trend line gets broken, but with earnings due out on 5/6, I will not be holding this one overnight.
There will be no Hit List tonight as we are 100% cash in terms of swing trades. Once we have open positions again on an overnight basis, Hit List posts will resume.
