Top Trade Ideas for the Week of August 20, 2012: The Rest
- Posted by Greg Harmon
- on August 19th, 2012
Here are the Rest of the Top 10:
CIT Group, Ticker: $CIT
CIT Group, $CIT, is building a bull flag between 37.50 and 38.75. It has support for a break of the flag higher from a bullish and rising Relative Strength Index (RSI) and a Moving Average Convergence Divergence indicator (MACD) that is averting a cross to negative and moving back up. The Measured Move higher takes it to 42.80.
Charles River Labs, Ticker: $CRL
Charles River Labs, $CRL, is building it own bull flag after pulling out of a rounding bottom and has a Measured Move higher to 40 on a breakout. The 3-box reversal Point and Figure chart (PnF) carries a price objective to 51 above that and the bullish RSI and positive MACD support the move higher.
Davita, Ticker: $DVA
Davita, $DVA, broke above a triple top at 90 in June and is now consolidating the rise in a Diamond pattern. A break of the pattern higher carries a Measured Move to 114, and the PnF has a price objective above that at 141. The RSI is holding in bullish territory and the MACD is improving towards a positive cross. On a break of the Diamond lower look for a retest of the 80 level.
Northern Trust, Ticker: $NTRS
Northern Trust, $NTRS, is breaking the neckline of an Inverse head and Shoulders with a price objective of at least 54. The rising RSI and the positive and increasing MACD support a continued move higher and triggering of the pattern. The PnF carries an even higher price objective, at 58.
Tractor Supply, Ticker: $TSCO
Tractor Supply, $TSCO, is breaking above resistance of a bull flag at 93.15. It has a rising and bullish RSI and a positive and increasing MACD to support a continued move higher. The previous high at 100 is next and the PnF carries a price objective above that to 126.
Up Next: Bonus Idea
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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 back half of August has the markets looking very similar to last week’s view. Gold and Crude Oil look best to continue higher, with a chance that Gold consolidates further. The US Dollar Index looks to consolidate, but with an upward bias and Treasuries look to continue lower. The Shanghai Composite looks to set new multi-year lows while Emerging Markets consolidate further before another upside move. Volatility looks to continue towards historic lows allowing for the Equity Index ETF’s SPY, IWM and QQQ to continue their rise to multi-year highs. The SPY looks the best followed by the QQQ and then the IWM, which is still among some previous congestion. It seems only a hard reversal by Treasuries could derail this market now. Use this information as you prepare for the coming week and trade’m well.
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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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