Good evening StockBandits!
The rally we saw on Thursday and Friday last week consummated the higher-low theory I’ve recently outlined here, and that’s a good thing…not because I want to be right or because I want higher prices, but because trend shifts always bring some great opportunities in the market.
A lot remains to be seen this time around, but there are reasons for the bulls to be encouraged. We’ve seen higher lows and higher highs established in recent weeks, and that puts some heat on the bears. Small caps have cleared their descending channel, and many stocks are shaping up for higher prices. Follow through must be seen, and that doesn’t have to be immediate, but it should happen in the next couple of weeks. Momentum can build quickly from here if this rally is embraced, and the movement beyond key levels last week certainly turned many traders more bullish. A push through the June highs, and this market could be off to the races.
In looking through the charts this weekend, there are no doubt a ton of stocks which are acting well at the moment. The challenge with adding long exposure here is twofold. First, chasing stocks well beyond clean technical buy points is a recipe for pain, and I’d rather be paid. Second, we’re right in the thick of earnings season, making it very difficult to hold overnights safely. In the video tonight, I’ll outline several plays which I’d normally take for swings, but with earnings in just a few days, I’m opting for shorter timeframes. There are some swings I’m eyeing as well, and I would suspect we see plenty more in the days to come.
I’ll cover my game plan for tomorrow in the video, and as always, feel free to share your own thoughts, trade ideas, and questions down below in the comments section.
Here is tonight’s video:
The Bandit Broadcast Video – Click to Watch!
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Video Stocks Discussed: HAL, STEC, OII, BVF, BIDU, MCO, BG, BEN, GDX, NEM
Swing Trading Candidates:
GDX created a bit of a double top during June after failing to stay clear of the May high, and since then it has turned lower. This Gold Miners ETF now looks to be in a downtrend, so this bounce offers a potential play on the short side if it begins to fail. A move down through the trend line at $48.80 will trigger a short sale for me. My stop and target levels will be on the Hit List.
NEM created a broadening top just a few weeks ago with incremental higher highs being followed by dips to lower lows. This stock recently sold off hard and has bounced back on weak volume, creating a rising trend line in the process. A move down through the trend line at $58.70 will trigger a short sale for me as this one heads lower in search of support. My stop and target levels for this swing trade will be on the Hit List.
Bullish Watch:
STP, BVF, SHLD, PXD, AEL, BIDU, YGE, RIMM, VAR, CEDC, RINO, VRX, TSLA, HAL, AKAM, CPNO, XLNX, CTSH, STEC, SOLF, ALTR, AGU, MCO, BG, HOT, CCJ, BEN, OII, HXL, WFT
Bearish Watch:
RIG, AGP, WMS, FAST, GDX, GG, ABX, NEM, GLD
The Hit List will be coming out soon with discussion on open positions and swing trade stops and targets, so be sure to watch for it.
