Top Trade Ideas for the Week of May 21, 2012: The Rest
- Posted by Greg Harmon
- on May 20th, 2012
Here are the Rest of the Top 10:
Athenahealth, Ticker: $ATHN
Athenahealth, $ATHN, has held firm during the market pullback in a symmetrical triangle. Bounded by 75.20 to the upside and 70.50 on the downside a break either way has a measured move from the pattern of 8.40. There is not any solid clue from the Moving Average Convergence Divergence (MACD) indicator or the Relative Strength Index (RSI) as to the next move. There is very high short interest at over 20% in this name. Wait for a break and then jump in.
Cerner, Ticker: $CERN
Cerner, $CERN, broke below support at 78 and ran hard lower on Friday to the 50 day Simple Moving Average (SMA) on big volume. Short interest is elevated at about 8%. The RSI is pointing lower and falling while the MACD is negative and growing more so. Both support more downside. I like this more than many that have been trending lower because the RSI is still far from being oversold.
Edwards Lifesciences, Ticker: $EW
Edwards Lifesciences, $EW, is turning a bull flag into a reversal. The RSI is running lower with a MACD that is crossed negative and growing more so. Look for a break on the real body of the gap up day candle to enter short.
HollyFrontier, Ticker: $HFC
HollyFrontier, $HFC, is pounding on support at 28.20. The RSI is bearish and trending sideways with a recent blip down. The MACD is flat without and information value. A break below support has a Measured Move to 20.20.
Home Bancshares, Ticker: $HOMB
Home Bancshares, $HOMB, is also trying to keep a bull flag from turning into a reversal. The RSI is holding at the mid line with a MACD that is negative but stalling in its growth to the downside. Notice that the Bollinger bands are opening though. A move under 27.85 looks to at least fill the gap. And a move over 28.75 has a Measured Move to 31.
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After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Saturday which heading into the last week before the unofficial start of Summer shows the reality of a continued bearish bias is strong. Crude Oil looks better to the downside with Gold heading higher at the same time as global economic fears are growing. The US Dollar Index and Treasuries are looking to continue to strengthen with a chance that the Dollar Index consolidates first. The Shanghai Composite is now firmly heading lower in line with the crash in the Emerging Markets. The Volatility Index broke the pressure cooker to the upside and looks to continue to move higher. These influencers set a backdrop for the Equity Index ETF’s to continue to the downside. There is no disagreement or discussion this week. The charts of the SPY, IWM and QQQ whole-heartedly agree with the downside bias. Look for a reversal in the Dollar Index or Treasuries as a sign that the worst is over for equities. Use this information as you prepare for the coming week and trade’m well.
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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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