Top Trade Ideas for the Week of February 28, 2011: The First 5

After reviewing over 700 charts, I have found some good setups for the week. This week’s list contains the first five of which are below, to get you started early. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which looks to bring more upside for Gold and Oil. The US Dollar Index is still in critical territory on long term support and looking lower with US Treasuries looking stronger still. Both the Chinese and Emerging markets are set up to continue lower. The Volatility Index may drift in a wider range but is not expected to move materially higher. The US Equity ETF’s, SPY, IWM and QQQQ, all look to continue their moves higher but with caution advised for a possible confirmation of the Hanging Man and a continued short term correction.

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

Here are the first 5 ideas for the week, to get you started:

Analog Devices, Ticker: ADI

Analog Devices had the typical bounce that every stock had Friday. In its case that bounce came off of the 50 day Simple Moving Average (SMA) and a previous consolidation range from January. The day ended near the previous resistance as well. If it can hold over 39.90 then it can head to 41.60 again, and if it can get through the resistance there then the next level of resistance is at 45 from 2004. The Relative Strength Index (RSI) also bounced and is head steeply back above the mid line supporting a move higher.

Biogen Idec, Ticker: BIIB

Biogen Idec is banging on the ceiling of resistance near 68.20. If it can get through that and then over the previous high at 68.80 then it has a target on a Measured Move (MM) of 78.80, based on symmetry with the move from the break over 58 to consolidation at 68. The rising RSI and positive Moving Average Convergence Divergence (MACD) indicator are supportive of a run higher.

The Blackstone Group, Ticker: BX

The Blackstone Group is making a third attempt at new highs after putting in a short term double bottom just below 16.50, looking a lot like a ‘W’ bottoming pattern. If it can get over 17.90 has resist at 19.50 from late 2007. The rising RSI and improving MACD will facilitate a move higher.

Dolby Laboratories, Ticker: DLB

Dolby Laboratories continues to hold 51 as support. What makes it interesting now is that the MACD has come back toward flat and about to move positive while it is crossing up and the RSI is no longer falling. Notice also that it printed two consecutive Hammer reversal candles last week. If these are confirmed by a move higher above 52 then it has resistance at 54 and the bottom of the gap down at 57 before it can try to close the window to 60.

International Coal Group, Ticker: ICO

International Coal Group is trying to make a higher high in the resistance area between 9.75 and 10. If it can get over 10 it has resistance at 10.57 and 11 from 2008 before it can look higher to 11.50 and the 12.10-13.10 consolidation range from June 2008. The RSI is rising, and although hard to see from this chart, the MACD is crossing up and about to move positive.

Up Next: The Rest

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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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