Top Trade Ideas for the Week of October 29, 2012: The Rest
- Posted by Greg Harmon
- on October 28th, 2012
Here are the Rest of the Top 10:
CNOOC Limited, Ticker: $CEO
CNOOC Limited, $CEO,is approaching resistance at 210 for the fourth time since March. It has a bullish Relative Strength Index (RSI) and a flat Moving Average Convergence Divergence indicator (MACD) to support a breakout higher. On a move over resistance it has a Measured Move higher to 225 and the 3-box reversal Point and Figure chart (PnF) has a price objective at 266, well above.
EZcorp, Ticker: $EZPW
EZcorp, $EZPW, is coming off of a bottom at 18.50. It has a MACD that has just crossed to positive and a RSI that is trending higher. Both support further upside. If it can overcome the doji from Friday it should continue higher.
M&T Bank, Ticker: $MTB
M&T Bank, $MTB, is consolidating in a bull flag after breaking higher. The volume structure and RSI falling back from being technically overbought, re-enforcing the flag make it attractive. A break over the top has a Measured move to 109.50 and the PnF has a price objective even higher at 132.
Nuance Communications, Ticker: $NUAN
Nuance Communications, $NUAN, is consolidating after a move lower. The RSI is looking as if it may bounce suggesting a reversal with a MACD that is improving. A break of the consolidation higher can move towards the PnF price objective of 36. But a breakdown out of consolidation carries a Measured Move to 20.40.
Spreadtrum Communications, Ticker: $SPRD
Spreadtrum Communications, $SPRD, broke above resistance at 22 and is moving higher. The rising RSI and positive and increasing MACD support a continued move higher with the PnF price objective at 28.50. This name also has elevated short interest at about 9% that could help it higher.
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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 next week sees the markets continuing to look vulnerable. Gold is still biased lower in the channel but maybe finding a bottom while Crude Oil looks better lower. The US Dollar Index and Treasuries seem content to move sideways with longer term bias lower. The Shanghai Composite is done with its bounce while Emerging Markets continue to consolidate. Volatility looks to remain low but is showing signs of life. These create a mixed environment for the Equity Index ETF’s SPY, IWM and QQQ, with the Dollar and Treasuries supporting Equities while Volatility and Crude Oil point lower. The charts of the Indexes themselves all are biased to the downside. 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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