I have looked at many, many beaten up charts over the last two evenings, and tonight’s 52 week highs list has only 7 names on it. Stocks are in need of some major repairs before great setups will appear.
However, one of the stocks on tonights 52 week highs list is [[CPHD]]. Since I happen to be long the name, and have voted it as my stock of the year at Ragin’ Cajun’s place, I decided to post the chart above. It is on the overbought side and did print a bearish candle today. However, it is hard to argue with the strength represented in the chart.
Another strong name from the Healthcare industry is [[OMCL]]. This stock is also overbought, but is worth watching to pick up some on a pullback. A nice pullback here on low volume will make a great Cup-with-Handle formation.
Finally, my favorite setup from tonight’s screens is a [[DE]] short. I heard some grumblings about Deere’s competitor [[CNH]] citing weaker growth in 2008. Deere is setting up beautifully after 2 days of failing to overtake the 50 day average. With a weak outlook posted by its competitor, DE looks ready to re-test support and the 200 day moving average near $70.00
Agree with you on DE
Paired trade – Long CAT, Short DE
Best case they both meet at 70
Ugly chart, for sure, but those slow oscillators like your slow sto there, and the RSI(14), haven’t even crossed midfield yet. Are you ready to jump in now and let the trade run against you up to 95 or so before it starts going your way?
Jingle- RSI(2)@ 52.29.
You missed the point. DE failed again at 50 day, and a stock in its industry, a competitor, just reported weaker guidance for 08.
No way DE runs to 95.
Thanks, but I didn’t miss your point. Your point is well taken. You may, in fact, be right.
I just think there may be more to it.
You’re betting the farm on the MA50 gobsmacking DE. If the MA50 were downtrending instead of flat, *and* if the SPX hadn’t printed that big hammer the other day, I might see it your way.
And you’re betting that the competitors’ bad news trumps the happy-days-are-here-again momos that may pile back into DE until the next broad-market smackdown. I think it might run up for a while.
And I picked 95 as a notional uncle point that says DE isn’t going down at all. I don’t think DE will get to 95 either. But I don’t think it’s so weak that the MA50 will stop it.
But you may be right. It will be fun to watch — or trade, as you see fit.
P.S.: I saw your RSI(2) before my first post, too. It’s just that the longer-term oscillators may rule if this isn’t a three-day-knee-jerk run.
Thanks Woody. CPHD and OMCL are two of my faves. I will probably get back into CPHD soon.
Jingle- thanks for the feedback.
I don’t particularly disagree with your assessment.
I’m not going to establish a position in it this morning with the futures so strong. I’d rather wait until the momo ebbs a bit.
Bought back into FXP and QID this morning. The price was right.
They’ll all burn.
My trailer has marble floors. 😀
I used to live in a trailer in grad school, in GA. I was domiciled in that arrangement during the time of the Slaughtering of the Emu.
Ah know, ah remembah, hunny.