Good evening StockBandits!
The NAZ finally broke out through 3196 today, but in all honesty it was more of a technicality than a true breakout. Highly-anticipated breakouts like the one we’ve been waiting to see in the NAZ aren’t often yawned at when they finally occur, but essentially that’s what happened today. The tech index closed right at the number after pushing 9 points beyond it earlier in the day, raising additional questions as to why it has been so reluctant to participate in the rally.
Overall, today’s session was a bit erratic with a burst of early strength and then a quick mid-morning retreat and mostly quite a bit of back and forth throughout the session. In the end, the net changes were pretty minor and nothing of great meaning took place. The RUT made another new all-time high with yet another incremental gain on the day, keeping the slow-grind environment intact.
I enjoyed getting to present in Scottsdale last night, and I’d like to welcome those of you who are brand new this evening. I’m always available to help out, so anytime you have questions please feel free to post them inside the member area via the comments section beneath any post, or send me an email and I’ll be glad to respond.
If you haven’t already done so, it’s time once again to submit your stocks for review in this week’s Charts on Demand video. I’ll be recording that tomorrow, so if you’re eyeing some stocks and want my input on the charts, hit the button in the sidebar inside the member area and send in the tickers you’d like me to review. I certainly don’t have all the answers, but I’m always willing to share my views in an objective way.
Let’s get to the charts.
NAZ – The NAZ finally was able to push past 3196 intraday, but finished less than 1 point above that level. This is, to say the least, a very hesitant breakout attempt and it has yet to impress anyone. Nonetheless, resistance is here and now the bulls have a chance to push this index higher. This is the last of the 4 indexes to post a new 52-week high on this rally, so there’s also potential for a catch-up type of move but it will have to happen with greater enthusiasm and follow through than we saw today.
SP500 – The S&P pushed past 1515 last week and then 1518 this week and now it’s sitting just a short distance from each of those levels. This index is edging toward its all-time high of 1576 from October 2007, but still isn’t running away at the moment. For this reason, pullback types of plays continue to be the most favorable setups, followed by breakouts. Given the slow-grind nature of this move, entering after minor weakness has simply offered a little more edge on most names.
RUT – The RUT keeps inching higher without a ramp since New Year’s, but that’s not such a bad thing. The gradual trends can persist for quite some time, and with this index having tacked on 20% since mid-November, that’s exactly what’s happening here. No negative changes of character as of yet, which means higher prices may be in store for a little while longer. At some point, a pullback would be very beneficial for this index to help this trend continue by creating some higher lows and support zones.
DJIA – The DJIA just can’t seem to free itself from the area of this high channel pattern despite a few attempts in recent days to clear 14020. A long-awaited close above that level would likely pave the way for a quick push to the all-time high of 14198 or beyond.
Notable Names:
V is showing some subtle hints at bearish price action here after carving out a lower high and having some distribution days in recent weeks. This stock also has an unfilled gap just beneath current levels which could easily fill. Given the slow nature of this stock and the high price, I won’t be tying up capital in it, but felt this was worth pointing out as an example of how price may be indicating a gradual change of character.
CERN cleared its summer high by a whopping 3 cents, only to pull back slightly from there. This stock has had some recent momentum but the failed breakout suggests it may need some rest. If we do see that take place for a few more days, that may set up a good play, but at this point my inclination is to stay away and let it base out further.
AEO is moving laterally but two trend lines are converging by the day. Eventually, they will put price to a decision of moving up or down out of this large wedge, which could produce a decent move. I’m going to let this pattern mature further before considering a play, but a battle may be shaping up with lower highs and higher lows.
New Swing Trade Candidates:
These stocks look ready for imminent multi-day moves. Pattern confirmation occurs with a move through the entry level. Initial stop and target levels are also provided.
WDC was brought to my attention last week via the Charts on Demand requests, and it’s acting well. Here it is working on an ascending triangle pattern, and quite honestly could stand to base for a little longer. However, I’m setting up this play just in case it goes sooner than later. I’ll be looking to get long above $49.60 as a new high is made and I’ll use rising support for my stop.
EBAY has been churning for a couple of weeks right near highs while rising support has caught up to price. This sets up a nice pivot for a turn higher, so I’ll look to get long if $57.30 is cleared. This is a highly liquid stock, not a fast mover, but the steady action of late could easily continue.
NAV was setting up recently for a play, I set it up, and then it promptly negated that pattern. Since then it has rebuilt and now looks ready to go. I’ll get long above $27.10 as this compression pattern gets confirmed, looking for a gap fill from last summer followed by a test of the prior high.
Bullish Watch (additional setups – click for charts)
Bearish Watch (additional setups – click for charts)
Trade Like A Bandit!
Jeff
