Top Trade Ideas for the Week of December 27, 2011: The Rest

• Posted by Greg Harmon
• on December 26th, 2011

Here are the Rest of the Top 10:

DaVita, Ticker: $DVA

DaVita, $DVA, triggered an Inverse Head and Shoulders pattern late in November. Since then it has pulled back through the neckline and found support before negating the pattern. Now back through the neckline it is moving higher with a Relative Strength Index (RSI) that is bullish and rising and a Moving Average Convergence Divergence (MACD) indicator that has just crossed bullishly positive. A move through the 200 day Simple Moving Average (SMA) near the December high would put the Inverse Head and Shoulders target of at least 91.36 back on the radar.

Regions Financial, Ticker: $RF

Regions Financial, $RF, has risen to Triple Top resistance at 4.45 from a series of higher lows. As it arrives again it has a RSI that is bullish and a MACD that is positive and growing, both supporting more upside. It did print a Hanging Man Candle Friday though, a potential reversal signal. Look for a break through resistance to get long.

Reliance Steel & Aluminum, Ticker: $RS

Reliance Steel & Aluminum, $RS, is making a Double Top at historical support/resistance near 50.25. It has been trending higher since October making higher highs and lows along the way. It has a RSI that is bullish and rising off of the mid line and a MACD that is about to cross positive supporting more upside. Notice also that the 50 day SMA is only a week or so from a Golden Cross through the 200 day SMA. Look for a break of resistance to buy it.

United States Cellular, Ticker: $USM

United States Cellular, $USM, is hitting the top rail of an Ascending Triangle at 44.20. It has a RSI that is bullish and has remained so throughout the triangle never dipping below 40. The MACD is positive and increasing also. These both support a push though and higher. The target on the break of the triangle is to 50.20. Short interest is a bit elevated at over 5% which could aid a move higher on a short squeeze.

Williams Companies, Ticker: $WMB

Williams Companies, $WMB, is triggering an Inverse Head and Shoulders with its move over 32.65. The price target to complete the pattern is at least 43.65. The rising and bullish RSI and the MACD that has just crossed positive both support more upside. After the 2008 at time high of 37.36 it has clear air higher.

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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 looks as we head into the last week of the year with Gold consolidating but looking to move lower while Crude Oil may consolidate also but is biased to move higher. The US Dollar Index looks to continue higher while US Treasuries consolidate their loses above support. The Shanghai Composite looks to consolidate further within the downtrend while Emerging Markets ride a short term wave higher within their downtrend. Volatility is poised to continue lower. The influencers of the Equity Index ETF’s are mixed but biased to support Equities moving lower. This is in conflict with the short term view in the charts of SPY, IWM and QQQ which look higher within a a broad consolidation range, perhaps signaling a topping. The US Dollar Index joining Treasuries lower will help the rally in equities continue. But a reversal high in Treasuries, joining the Dollar Index, could turn that consolidation range into a move lower. The strongest of the Equity Indexes is the SPY followed by the IWM and the weakest the QQQ. Use this information as you prepare for the coming week and 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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