FRGI WWAV are two food-related plays which I have referenced before.
On their respective daily charts, note the constructive price action, overall, in strong uptrends.
Keep them on your watchlists going forward, especially in light of the BKW THI buyout.
What are you trading this afternoon?
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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.
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CPFL Energia S.A. (CPL), the Brazilian utility firm with a big yield which I have previously discussed as a long-term investment idea, is very encouraging as it indicates a major higher low could easily now be in place.
I added to my long-term investment here.
After a multiyear downtrend, seeking out the higher low is critical in determining whether a true change in trend is afoot.
The longer it holds over $19, the better.
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With the S&P 500 Index tagging 2,000 this morning, there is certainly a fair amount of optimism if not giddiness out there. I am seeing some good potential short squeezes, especially with the Labor Day holiday coming up.
In addition, we looked at the broker IBKR last Friday as a long setup, which is still the case if you observe the first chart, below.
And it is also worth noting that the major casinos continue to lag here, with MGM being just one example.
What are you trading this morning?
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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.
Labor Day occurs fairly early this year, on September 1st, a week from this Monday. As a result, we could easily see even lighter volume than we did this past week, which would be quite a feat given how thinly the indices have traded in August.
Against this backdrop, we may see a form of “holiday trading” this week, especially the closer we get to Friday and a three-day weekend into next week. Typically, a holiday week will see drifting action on the indices, with a bullish underlying bias as short-sellers back off even from unhealthy charts.
With this in mind, let us return to a thesis we looked at two weekends ago with National Bank of Greece. NBG had been badly beaten-dowin along with European equities in general. While the Greek country ETF, GREK, made fresh lows, we pointed out that NBG did not and was setting up perhaps for a snapback rally.
Since then, we can see that the National Bank of Greece did indeed rally back up to its 50-day moving average.
Although it may be a bit late to chase National Bank of Greece, a similar technical setup would be to play for a snapback rally in FEYE, a badly beaten-down and now despised growth tech stock.
On the daily chart for FireEye, note the potential lows off prior support. In addition, we have a bullish RSI divergence to price (top pane of chart).
For reference, the RSI is simply the “Relative Strength Index” used to identify changes in technical momentum. Above 50 is generally considered a bullish RSI, with above 70 viewed as overbought. Trending below 50 is considered a bearish RSI pattern, with below 30 considered oversold.
Here, the RSI is holding well above where it was in May, even as price is near those lows. This constitutes a bullish divergence and should be watched to see if price follows suit.
Just as with NBG, part of what makes this setup attractive, even though it is clearly a counter-trend trade in a damaged chart, is the ability to define downside risk. A stop-loss below $27, Friday’s lows, is suggested in order to mitigate downside risk.
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Comments »
In front of earnings this Wednesday, it will be interesting to see if Splunk can continue to hold its prior September 2012 resistance levels as current support. Price does indeed have memory, but we have clearly already seen the initial bounce off support.
What say you, night owls?
Screaming buy or more pain?
(Or take a pass until earnings have concluded)
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