Five Stocks to Add to Your Lunch Paella

Courtesy of The PPT algorithm, here are the most current top five readings from my “12631 RELATIVE STRENGTH” custom-made screen, identifying which stocks are exuding some of the best performances to the market at-large at any given moment.

I look for stocks whose Daily PPT Hybrid Score surges, while the Weekly Hybrid has been negative over the past week. This can often yield stocks which are emerging from consolidations.

Members can click here to view and save the screen.

Sorted for at least 500,000 shares of daily average volume to ensure liquidity.

Please click on image to enlarge.

________________________________________________________

Despite today’s sell-off in equities, my bond short is not taking much heat at all. Typically, bonds should be a logical “Safe haven” on a day like today. But they are barely bouncing. My short thesis is still intact, though I would not be surprised to see TLT bounce around a bit early this week, setting up a potential bear flag before attacking the support on the first daily chart, below.

Also note that the VXX ETF is underperforming the actual VIX today, perhaps indicative of complacency on the part of retail traders who are in no rush to hedge.

Finally, keep an eye out for X. The daily chart, second below, looks on the verge of breaking down further from a well-defined topping pattern. Watch it under $24.

What are you trading this morning?

___________________________________________________________

___________________________________________________________

Keep an eye on the multi-year winner CP to finally crack here, from the daily chart rising wedge breakdown highlighted first below. This one has been a monster, but I think the tracks will become hazardous up here.

Also, I had to stop out of my gold miner long for a loss inside 12631 this morning. On the second chart below, the daily of the junior gold miners is not breaking down, per se, in the sense that the lows of the past month have held. But clearly they needed more time to consolidate. Perhaps I got shaken out, as they are reversing higher as I write this. If that is the case, I am willing to hop back on the long side. Stay tuned.

____________________________________________________

____________________________________________________

I am still considering a long LO/short PM tobacco pair trade setup, with Lorillard sporting a bull flag in an uptrend, post-breakout. And Philip Morris below all declining daily chart moving averages.

Which tickers are at the top of your watchlist this morning?

__________________________________________________________________

__________________________________________________________________

The following is just a small excerpt from my latest Weekly Strategy Session (please click on that hyperlink for details about trying it out). which I published for members and 12631 subscribers this past Sunday. 

 While the soft commodity complex has been on a tear (and now likely going to pause or consolidate in the coming week), copper has been noticeably weak, including Friday’s horrendous price action. This bifurcation may indicate that inflation without global growth is on the horizon, with soft commodities rallying sharply while a very weak “Dr. Copper” suggests the global economy will stagnate, at best.

But the more actionable point may be to key off the emerging markets for clues and a potential trade. 

First, the copper ETN monthly chart shows a descending triangle pattern flirting with a major breakdown below $37. A decisive break of this level projects a move back down to the 2008 crash lows, below $20, as you can see the lack of support underneath. 

Given the close relationship between copper, global growth, and emerging markets, an aggressive trader may consider…

Please click here to continue reading

Despite new all-time highs on the S&P 500 Index last Friday, note the correlated (to equities) U.S. Dollar/Japanese Yen currency cross is diverging. While it is true that the Yen has cooled off with the Dollar’s recent bounce against it, you can plainly see the lower high (versus the January highs) on the daily chart of the pair, below.

This divergence certainly bears watching this week with a soft futures market this evening, and especially if the Dollar rolls back over with equities this week. Should that latter scenario materialize, it will reinforce the Yen’s status as a leader.

Long Ideas for Monday on strength: BAS FRED M 

Short Ideas for Monday on weakness: BA CELG WMT 

Drop me your top tickers overnight.

______________________________________________________________