The two daily charts below of H and KFN serve as examples of the type of technical setups you look for during a pullback from multi-year highs in the market, without signs of a major top at hand. Note the constructive overall volume patterns below, with the green bars denoting buy volume overpowering the red selling volume bars. Next, note that both stocks pulled back to their respective rising 20 day moving averages amidst an uptick in negative sentiment accompanying the market correction.

Moving averages are best used as reference points to gauge the underlying strength of a security or index, or lack thereof. While there is always the possibility of a vicious bull trap (which is why stop-losses are always a recommended strategy), the bulls got the reaction they wanted by the market on Thursday with a bevy of bounces off 20 day moving averages like the ones below, with sound volume patterns intact.

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COG was mentioned in my Weekly Strategy Session as a play to watch for rotation as the week progressed. I have also mentioned NTSP and PZZA over the past week. Today, they are showing promising signs of breaking out. Also note EXPE continues to be a leader in the online discount travel arena, as it figures to set up again.

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I am impressed with the way in which DPZ has bounced back from its correction last spring. On the back of Dominos’ strength today, consider PZZA as a breakout candidate from a very coiled daily chart base with an impressive volume pattern for bulls.

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You might notice that some of the notable outperforming stocks from the summer like MLNX and SSYS have cooled off here. When a few of the leaders see a bout of a profit-taking, the issue then becomes whether underlying demand for the market as a whole is strong enough to merit a rotation to other stocks basing and setting up to breakout behind the winners.

Currently, there are plenty of those types of stocks that could easily represent the next wave of winners, working through bull flags or mildly consolidating technical bases. Below, you will find  just a few ideas that I like on strength. As always, use stop-losses to mitigate your downside risk should you choose to take any of them for trades.

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With the serious assertions (in a court of law) these days that Steve Wynn is “an old school Vegas gangster,” I thought I’d take a look at the chart of his eponymous casino and resort empire. On the weekly timeframe, it indicates a very long pause after some serious outperformance off the March 2009 bottom. Above $170 represents major resistance dating back to 2007 and then 2011. You could also make the case of a monthly chart cup and handle setup here.

Of course, none of those long-term patterns mean much if WYNN does not find support sooner than later to stem the tide of the correction. Despite the casinos largely being dead money (gangster pun intended) for a while now, you can see below on the daily timeframe that WYNN breached the neckline of a bullish inverse head and shoulders setup, with a projected target of roughly $130 and beyond.  The volume pattern is promising as well. Bulls now want to see $110 turn into firm support.

I have no position in the stock but am looking to see if the casinos, especially best in show WYNN, are gearing up for a strong run into the holidays.

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Back on July 8th in a video inside this blog post, I noted that quite a few firms related to the health, nutrition, and wellness sector were showing relative, if not outright absolute, strength to the still-gappy-at-the-time broad market. In essence, firms such as HAIN and SMBL were out in front of the rest of the market before it too eventually broke higher. Fittingly, perhaps, those stocks lagged last week’s powerful thrust to fresh multi-year highs on the major averages.

On its face, a casual trader might dismiss these stocks as being “laggards” not worth of their time, and certainly not worthy of a place on their watchlists. That kind of mentality, however, probably kept those same traders either sidelined, unnecessarily fearful, or short since August. The better approach is to view these charts holistically, acknowledging that just as outperformers sprint well ahead of the pack, they can also rest while the rest of the herd tries to catch up to them.

As such, after a series of mild consolidations, the following health and wellness plays are set up to break higher on strength, once again.

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