Good evening StockBandits!
The S&P 500 finished flat as a pancake today following some intraday shifts of direction. Some buying right after the open led to the high of the session by mid-morning, but there was no follow through and prices subsequently reversed lower. The selling also looked as if it might have legs, but a test of the morning low led to another turnaround. From there, prices simply zig-zagged for the remainder of the day to create a bit of a corkscrew look on the intraday chart. All in all, it was another day of rest as stocks churned without losing ground or making any meaningful headway on the upside.
Days like this make it easy to overtrade as each new move starts to build hope that perhaps something significant is underway, only to fizzle out shortly afterward. On the daily charts, these rest days are actually healthy, even if enduring them brings a big lack of activity and subsequent boredom.
The indexes are marking time here after mild pullbacks from their respective June highs, which is a pretty good way to digest the most recent rally. This also allows many individual names to build short-term bases from which new trades may be placed once price can exit the boundaries of indecision.
Tonight I’m again focused on a handful of single-day setups for tomorrow’s session, as there remains a lack of compelling swing setups.
Let’s get to the charts.
NAZ – The NAZ is lifting from its test of support last week to turn higher within its short-term trading range. A push through 4344 should pave the way for a challenge of the 4371 high. This index led the way today, but volume was average and price is still caught between a pair of levels, so we still need to see an exit from this small range before we should expect any lasting follow through.
SP500 – The S&P also had average volume today but a descending trend line is starting to emerge. We also have rising support, which makes for a bit of a wedge pattern. A turn up and out of the wedge (1943) ought to bring a quick test of the 1955 high, if not a new high given all the recent persistent strength.
RUT – The RUT finished at the high today but it was another relatively narrow range day. This index has had sufficient time to rest after the early June ramp, so the next order of business here is a push through 1179 to keep the rally going. Beyond that is 1193, the bounce high from April.
DJIA – The DJIA didn’t make any headway today but it did hold the prior breakout zone once again after another test. The high stands at 16970, which makes that the number to watch should we happen to see strength return for this index.
Notable Names:
GMCR is one that belongs on watch here. Price doesn’t quite look ready to break out, but soon it may. A new high at $125.10 would allow price to regain momentum, but until then it is still range-bound. I’ll post updates as this one appears ripe for a move, but wanted to bring it to your attention as a radar stock.
SUNE spiked by nearly 11% today on strong volume. It’s approaching the prior high and may soon produce a breakout. I’m not eager to chase today’s big move, nor am I interested in initiating a swing in this stock due to its frequent reversals in the past few months. However, if it can base for a few days beneath the highs, it may offer a breakout play so it’s on watch for me.
CAMP is again on my list for a trade tomorrow. This cup and handle pattern developed a little more today with another bar within the range of the past week or so. I’m still watching $20.05 for a new recovery high to grab this one for a single-day play on its way back toward the unfilled gap from April.
CLDX has rested for a few days to create a small base here. Price could resume the recovery attempt if it’s able to clear $18.15. Due to this being a small base, my expectation is for a limited-time advance even upon confirmation of the pattern. In addition, it’s a biotech stock, so I’m only interested in a single-day play if it goes.
TEVA is also still on my list for a trade if price can clear short-term resistance with a push through $52.50. This is another drug stock and the pattern is still somewhat loose, so I’ll just grab it for a single-day play on the long side as there’s some room to rally back toward the April high for a test.
SANM has been acting well with a strong surge higher out of a recent triangle pattern. Over the past few days, it has pulled back quietly on reduced volume for a rest. This has allowed the stock to reset, so I’m looking to grab it for a play on the long side if price can clear the small trend line at $21.95. I’d prefer a little bit larger base for a swing, so if it goes Tuesday it will only be a single-day play for me.
New Swing Trade Candidates:
No new swing candidates tonight.
Bullish Watch (click for charts)
Bearish Watch (click for charts)
Trade Like A Bandit!
Jeff
