Let’s take a little review from last week’s post.
That inverted doji in the $SPX we highlighted from Friday (the 5th) did in fact mark a double top, as this index sold off heavily last week.
The rising wedge in the $COMPQ we talked about did in fact break to the downside as well.
Despite a report at the first of the week calling for a slowdown in Asia, the $FXI did in fact break out.
And after week’s of speculation, $UNG finally made its move as well.
A lot of charts are looking “heavy,” especially in the pharma sector, however, after the selling last week I would expect a 1-2 day bounce, which may set up some good shorting opportunities.
Now let’s see what may be moving this week.
$AAPL “tagged” the target box on the downside, though you would have had to short the gap down on Monday to be a part of that move. I think you can use the range of Friday’s doji to either get long or short depending on which way it breaks. Ten points may seem like a big stop, but it only about 1.5% of the stock price. $AAPL’s action this week will likely be a barometer for the overall market.
$AMZN is another bellweather. If it can hold support around $238.00 look for a bounce play. Best case scenario would be a gap down and intra-day reversal at that level to get a swing long for a 1-2 day bounce.
$ARNA is one of the few pharma stocks still looking good as it bases under this resistance level. However, if the sector falls, so likely will this stock.
$CHK was on the list a few weeks back, but the ascending triangle pattern failed. It has created that pattern again, the difference this time is that $UNG has broken out, and $CHK is above its 200ma with an NR7 bar on Friday.
A holdover from last week, $CQB may be boring, but it’s still forming a nice flag below gap resistance.
$GRPN is way up there on the “hated list” which is often the time to get involved. Nice little bottoming pattern here with a recapture of the 20 and 50ma as well. A buy above $5.50 with a 50 cent stop gets you a 1:4 risk/reward ration to the gap fill.
Developing a large flag here, $LULU is a buy on the break of the top channel, but probably won’t happen til the broader market firms up.
A break of this range in $OVIT is a short.
Don’t know much about $TTWO, but it is showing good relative strength here.