Good evening StockBandits!
The indexes have rebounded nicely from their mid-May pullback lows, in some cases by more than 5%. That’s impressive, especially considering that the signals remain somewhat mixed among the averages. For example, the S&P has broken out to new all-time highs, the DJIA is sitting beneath its highs, the NAZ has cleared short-term resistance but stands well shy of the spring highs, and the RUT’s still acting, well, like it’s a little bit caught in a rut!
Last week we had a holiday-shortened week which was characterized by early strength (Tues) and then a bit of levitating for all but the S&P. You’ve seen those zero-gravity airplanes where they go to a high altitude and then pitch the plane’s nose downward temporarily to give those along for the ride the feeling of weightlessness. That’s a little like how this market looks right now. Not on the verge of a crash, but perhaps ripe for leveling off a bit.
My watchlists remain very sparse on both the bullish and bearish sides, so there has been no real status change. Stocks have bounced back in many cases, so short-sale candidates aren’t really prominent. Likewise, the recent lift has left many names looking due for some rest, so the buy list isn’t heavily populated either. I’ve been taking what the market has offered lately, which have been plays of the quick-flip variety, and that’s going to again be the case as we head into Monday.
Let’s get to the charts.
NAZ – The NAZ has sort of stalled here in the past few days, which the bulls should be grateful for. Since clearing 4185, price hasn’t given back any ground, so each day that remains the case it is of benefit to the bulls. The next technical order of business on the upside is 4286 where the early-April bounce peaked, whereas on the downside we still have an unfilled gap to 4185.
SP500 – The S&P just keeps on trucking and just went 8-for-10 on the upside. We keep seeing strong closes as well, but Friday’s heavy volume and minor net change points to some turnover taking place, so perhaps a rest is imminent. It has room to pull back now, but bulls will want to keep it above 1883.
RUT – The RUT cleared 1137 twice last week but ended just beneath it. There’s a small gap to 1126 it may fill soon on any retreat in price, but on the way back up the next big level will be 1160. A higher low on any pullback would be what the bulls want to see after this incremental higher high last week.
DJIA – The DJIA is just a few points from a breakout to a new all-time high after last week’s lift of 110 points. This index has repeatedly cleared 16588 but hasn’t been able to sustain previous breakouts. A higher high carries no guarantees, but would bode well for the bulls if it can be made.
Notable Names:
DVN is still facing resistance here and was on my list a couple times last week. It hasn’t broken out yet, so I’m setting up another single-day trade here on the long side if it can make a new high at $74.10.
HAL has spent several weeks basing just beneath resistance, so a breakout to a new high could spark a quick rally. Support isn’t nearly as clear-cut as resistance, so I’ll just be taking this one for a single-day play if price makes a new high at $65.20.
BBY is edging closer to multi-month resistance and a push through could set it free for a quick partial gap fill move. I like it for a single-day play to grab the initial breakout if price clears $28.30.
EXPD is stabilizing here after a shallow dip. I like the looks of this one for a single-day play if price can clear $45.85 to get above the descending trend line drawn off the recent high.
FSLR is already starting to turn lower here but still has room, so it looks good to me for a single-day momentum play on the short side. I’ll look to enter upon a downside continuation move with a break below $60.95.
MKTO has rolled over in the past few sessions and is by that measure just not in shape to chase it on the short side. However, price is sitting on key support here and a breakdown through $22.40 interests me for a single-day play on the short side. Such a break could spark a bit of a washout move, but a swing stop would just be too wide here to consider.
New Swing Trade Candidates:
No new swing candidates tonight.
Bullish Watch (click for charts)
Bearish Watch (click for charts)
Trade Like A Bandit!
Jeff
