Top 10 Trade Ideas for the Week of December 27, 2010

After looking at over 700 charts, I have found some good setups for the week. This week’s list contains 10 long ideas, and 1 short setup. The process was less transparent and the notes are abbreviated due to Holiday time with my family, but I think you will still find them interesting. These were selected and should be viewed in the context of the broad market daily and weekly trend, reviewed which looks a little bleak for Gold and Treasuries, but higher for Crude Oil. The US Dollar Index may run sideways before a move higher. The Shanghai Composite and emerging markets are waiting for a catalyst, probably the same one that will move the US Dollar Index. The Volatility Index looks lower but even if it bounces it will not be enough in itself to hold back the equity markets. Those equity markets, SPY, IWM, QQQQ are all looking a little tired in the very short term and may continue to consolidate or slightly pullback next week on their way to higher levels down the road. From the Sector Review the best sectors have been the Energy and Consumer Discretionary sectors and the weakest Technology and Health Care.

(As always you can see details of individual charts and more on my twitter feed and on chartly.)

Here are the top ten for the week in alphabetical order:

1. Bed Bath & Beyond, Ticker: BBBY

Bed Bath and Beyond printed a shooting star on Friday on good volume. The Relative Strength Index (RSI) shot above 70 and may need to pullback short term. Look for confirmation Monday, and then support lower closing the window at 48.20.

2. Cabela’s, Ticker: CAB

Cabela’s Has been in a bull flag consolidating over the 21.58 support area. The Moving Average Convergence Divergence (MACD) indicator is starting to turn higher now. Look for a break above 23.50 to move higher and a measured move out of the flag of 27.

3. Rockwell Collins, Ticker: COL

Rockwell Collins has been in a consolidation phase after bouncing off of support at 54. Look for a break above 59 to head to 62 and then 64.

4. CSX, Ticker: CSX

CSX has been consolidating after retracing the move lower in 2009 completely. The Simple Moving Averages (SMA’s) are rising to meet it and the RSI is holding over 50. Look for a move above 64 to run to 70.

5. Goldman Sachs, Ticker: GS

Goldman has touched the top Bollinger band near 170 3 times since the beginning of November, and is holding above the 167 support area. If it continues to hold look for a move through 170 up to the 178.60 resistance.

6. Huntington Bancshares, Ticker: HBAN

Huntington Bancshares broke through the 6.75 resistance area and has held for two days. If it continues to hold then look for 7.2 as resistance on the way to 7.80.The rising MACD and RSI support a move higher.

7. MedQuist, Ticker: MEDQ

MedQuist has flat lined between 8.75 and 9.00 for over a month, but the Bollinger bands could not be any tighter. it is ready to move. The RSI bouncing off of 50 and improving MACD suggest a move up. A break higher would have resistance at 9.50 and then a target of 11.00.

8. Sonic, Ticker: SONC

Sonic is in a bull flag after a run higher from 9.50. A break out of the flag would have a target of 12.50.

9. St. Jude Medical, Ticker: STJ

St. Jude Medical is in a bull flag after a run up from 39.50. A move out of the flag higher would have a target of 46.00 on a measured move.

10. Teekay LNG Partners, Ticker: TGP

Teekay LNG has a sterady trend higher but has been in a bull flag the last month between 37.50 and 38.00, ex the 3 day hiccup mid month which held when RSI touched 50. Look for a break above 38 to continue higher to 40.50 before the next rest.

Bonus Idea: USX, Ticker: X

US Steel has been in a bull flag between 58 and 59.50 after the move higher from 48. Look for a break to 60 to run higher to a target of 70.

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.

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