Top Trade Ideas for the Week of March 5, 2012: The Rest

• Posted by Greg Harmon
• on March 4th, 2012

Here are the Rest of the Top 10:

Athenahealth, Ticker: $ATHN

Athenahealth, $ATHN, is consolidating at the September high after a move up off of the plateau at 66 within the longer run higher from 49. The Relative Strength Index (RSI) is a bit extended in the low 70s but bullish and the MACD is positive but fading. Both reflect a need for the consolidation that is occurring. A break of the consolidation higher brings a Measured Move to 78. The short interest is high in this name at about 25% so be careful shorting on a breakdown.

Ctrip.com, Ticker: $CTRP

Ctrip.com, $CTRP, is consolidating at resistance at 28 after rising from the Triple Bottom at 22.55. Over the resistance the gap from November looms large but offers a good reward. The RSI is bullish and the MACD is positive and rising, both supporting more upside.

Dow Chemical, Ticker: $DOW

Dow Chemical, $DOW, is in a long consolidation channel with tightening Bollinger bands just over the target of the move out of the symmetrical triangle from November and December at 33. This was also the scene of a long period of previous consolidation from May through too August of 2011. The RSI remains bullish and is pointing higher but has been trending lower. A caution and the MACD is negative and holding fairly steady. Watch the gaps on a break lower and over 35 look for a move to the previous high.

IntercontinentalExchange, Ticker: $ICE

IntercontinentalExchange, $ICE, is building a bull flag after a strong move higher, working off a technically overbought condition. The RSI is slow to fade, strong, and a the MACD is about to cross positive, a diverging signal. The long upper shadow Friday adds some weight to the caution from the MACD. A move up over the flag has a Measured Move to 147.50 and a breakdown has support at the previous flag.

Occidental Petroleum, Ticker: $OXY

Occidental Petroleum, $OXY, has been in a tight consolidation range for 3 weeks. The Bollinger bands are getting tighter than gastric band foretelling a move very soon. The RSI is bullish and holding while the MACD is near zero offering no real signal. A break over consolidation and then 107.50 releases the hounds. A move under 102.50 has support noted.

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After reviewing over 900 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 first full week of March sees the market still looking strong but showing signs of a needed rest in some areas. Gold, the enigma, looks lower in the very short term but positive on an intermediate and long term basis while Crude Oil is consolidating in an uptrend. US Treasuries remain in their consolidation zone but are looking slightly better to the upside while the US Dollar Index appears to have found a bottom and ready to work higher as well. The Shanghai Composite and Emerging Markets both continue to look higher into next week. Volatility looks biased to the downside but has little room lower, while it certainly does not look ready to turn higher. These influencers set the stage for the US Equity Indexes to consolidate within their uptrend. A move lower by the US Dollar Index or Treasuries should change that to continue the rally higher. The charts of Equity Indexes are mixed though. The QQQ remains very strong while the SPY is starting to look ready to consolidate and the IWM may pullback. A hard move higher by the QQQ or lower by the IWM, dragging the SPY with either could set the direction for the next few weeks. Use this information as you prepare for the coming week and trade’m well.

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