Top Trade Ideas for the Week of March 16, 2015: The Best

• Posted by Greg Harmon
• on March 15th, 2015

After reviewing over 1,000 charts, I have found some good setups for the week. This week’s list contains the first five 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, Heading into the March Options Expiration week the equity markets are a bit mixed, mostly better looking to the downside.

Elsewhere look for Gold to continue lower along with Crude Oil next week. The US Dollar Index may consolidate in the uptrend but has a clear bias higher while US Treasuries are biased lower. The Shanghai Composite is trying to break consolidation to resume the uptrend while Emerging Markets are biased to the downside still.

Volatility looks to remain subdued but above the low range of the early 2014 keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ, but with the wind easing at their backs. Their charts all are consolidating in the short run with the bias to the upside for the IWM while to the downside for the SPY and QQQ. The long term uptrend remains intact for each though. Use this information as you prepare for the coming week and trad’em well.

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

Finisar, Ticker: $FNSR

Finisar, $FNSR, has been in a rising channel since October. Friday left it at the top of the channel. It was a strong stock in a not so strong market. The price action also closed the gap down from June 2014. It has bullish and rising RSI with a MACD that is moving higher and also bullish. There is resistance higher at 24.50 and 25.40 before 27.20 and 28.30. Support lower comes at 21.70 and 21.40 followed by 20.50 and 20. Short interest is high at 11%. Enter long on a move over 22.65 with a stop at 21.70. As it moves over 23.25 move the stop to a 50 cent trailing stop and take off 1/3 on a stall at 28.30 or higher. As an options trade consider the March 22 Calls (offered at 85 cents late Friday) and trade them like the stock trade (using the stock price as a trigger, stop and target). Give it more time with the April 22 Calls ($1.35). A different structure relying on the big open interest at 23 in March and April would be a March/April 23 Call Calendar (65 cents) and sell the April 20 Puts (15 cents) to lower the cost and add leverage.

Nordic American Tankers, Ticker: $NAT

Nordic American Tankers, $NAT, broke above the neckline of an Inverse Head and Shoulders pattern in December and proceeded past the price objective. After touching 12 it pulled back and retested the neckline in February, holding and moving back higher. Currently it is consolidating under resistance at 10.45 with the Bollinger Bands® getting tight. A push to the upside now would target a move to 15 on an AB=CD pattern. The RSI is rising over the mid line towards the bullish zone while the MACD is crossed up and rising. There is resistance at 11 and 12 above before 12.50. Support lower comes at 10 and 9.30. Short interest is elevated at 7.7%. Enter long on a move over 10.45 with a stop at 10. As it moves over 10.75 move the stop to break even and then to a 40 cent trailing stop over 10.85. Take off 1/3 on a stall at 12.50 or higher, and by 15. As an options trade consider the March 11 Calls (10 cents) as a flyer, due to the very large open interest there this week. Give it more time with the April 10 Calls (70 cents). So little to risk that there is no need to complicate.

Novavax, Ticker: $NVAX

Novavax, $NVAX, has been moving higher since breaking a long base at 5 in November. The price action of a rising and consolidating pullback resembles a 3 Drives pattern which would target 10.90 on the current leg. The RSI is bullish and rising while the MACD is about to cross up, joining the bullish party. Support lower comes at 8.50 and 7.45. There is resistance at 9.75 and then free air higher. Short interest is high at almost 15%. Enter long on a move over 9.45 with a stop at 9. As it moves over 9.80 move the stop to break even and then to a 35 cent trailing stop over 9.95. Take off 1/3 on a stall at 10.90 or higher. There is large open interest at the 10 strike this week so you could consider the March 10 Calls (15 cents) or March 9/10 Call Spread (40 cents) for a quick trade. Sell the March 9 Puts (15 cents) to juice it up. Give it more time with the April 9/March 10 call Diagonal (buy April an sell March) looking for the March 10’s to expire and then follow on sell the April 10 Calls or April 9 Puts.

Overstock.com, Ticker: $OSTK

Overstock.com, $OSTK, is rounding up as it consolidates the move higher over October and November. Should it continue, the Measured Move targets 33. The RSI is bullish, having never moved bearish during the consolidation, and rising now, with a MACD that is rising. Both support more upside. There is resistance at 24.50 and 27 followed by 28 and 29 before 31.40. Support lower comes at 22.40 and 21.10. Short interest is high at 9.7%. Enter long on a move over 24.20 with a stop at 23. As it moves over 24.75 move the stop to break even and then to a 75 cent trailing stop over 25. Take off 1/3 on a stall at 33 or higher. As an options trade consider the April 22.5 Calls ($2.10) or a April 22.5 bullish Risk Reversal ($1.40).

ZIOPHARM Oncology, Ticker: $ZIOP

ZIOPHARM Oncology, $ZIOP, broke an ascending triangle in February and then rose to meet the target at 13.45. Since it has been consolidating in a bull flag, but showing some life Friday. A move out of the flag higher would target 16.75 on a Measured Move higher. There is resistance at 14 and then free air. Support lower comes at 12.75 and 9.45. The RSI is strong and bullish while the MACD has crossed down, but at a very flat angle. Short interest is very high at nearly 30%. Enter long on a move over 13.60 with a stop at 12.75. AS it moves over 14.10 move the stop to a 50 cent trailing. Take off 1/3 on a stall at 16.75 or higher. As an options trade consider the April 10/14 bullish Risk Reversal ($1.35) and sell the April 17 Calls (65 cents) to add leverage and lower the cost.

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