Top Trade Ideas for the Week of June 1, 2015: The Best

• Posted by Greg Harmon
• on May 31st, 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 June sees the equity markets as mixed, with the QQQ strong but the SPY and IWM showing some short term weakness.

Elsewhere look for Gold to continue to hold between 1180 and 1200 while Crude Oil consolidates with an upward bias. The US Dollar Index looks to continue higher while US Treasuries also are looking stronger, possibly breaking their downtrend. The Shanghai Composite is in pullback mode in the uptrend but at a good support level, while Emerging Markets are falling and look weak.

Volatility looks to remain subdued keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. Their charts are a bit mixed, with all better on the weekly timeframe than the daily, and the QQQ’s the strongest short term while the SPY and IWM may pullback. 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:

AmSurg, Ticker: $AMSG

AmSurg, $AMSG, has been in a strong trend higher since December. The 50 and 100 day SMA’s have acted as rising support along the way. Last week gave a pullback that touched the 50 day SMA. It also showed 3 days of bottoming lower shadows in the candles, a possible reversal signal. The RSI has held strong while the MACD continues lower, but at an elevated level. There is resistance higher at 67.60 and then 69.90 before a Measured Move to 72.50. Support lower comes at 66.30 and 64.60. Short interest is elevated at 6.3%. Enter long on a move over 67.60 with a stop at 66.30. As it moves over 68.10 move the stop to break even and then to a $1 trailing stop over 68.60. Take off 1/3 on a stall at 72.50 or higher. Options strikes and spreads are too wide for an options trade.

Boeing, Ticker: $BA

Boeing, $BA, was a high flyer in 2014 and even the first two months of 2015. But since then it has rolled over and is coming in for a landing. It ran down a falling channel until the end of April and then broke down below it. The price is now testing the low from May after a solid down day Friday. The RSI is in the bearish zone and falling and the MACD is doing the same. There is support at 140.50 and then 136 followed by a gap fill at 132.50 and 120. Resistance higher comes at 147.65 and 155. Short interest is low under 2%. Enter short on a move under 140.50 with a stop at 142.25. As it moves under 139 move the stop to a $1.75 trailing stop and take off 1/3 on a stall at 132.50 or lower. As an options trade consider the June 140 Puts (offered at $2.03 late Friday) and trade them like the stock trade (using the stock price as a trigger, stop and target). Sell the June 133 Puts (42 cents) to offset some cost and make a Put Spread, or sell them twice for a 1×2 Put Spread if you like owning the stock at 126.

Dunkin’ Brands, Ticker: $DNKN

Dunkin’ Brands, $DNKN, broke above a long term resistance zone from 48.75 to 49.30 in April. It pulled back to the 20 day SMA and then started back higher. Last week it consolidated (read: did not pull back) under resistance at 53.45. It has a RSI in the bullish zone and strong with the MACD flat. There is resistance above at 54.10 and then free air with a Measured Move to 56.45. Support lower comes at 52.65 and 51.70 followed by 50.40 and then 49.30 with a gap to fill to 47.90. Short interest is high at 9.7%. Enter long on a move over 53.45 with a stop at 52.45. As it moves over 54 move the stop to break even and then to a 90 cent trailing stop over 54.40. Take off 1/3 on a stall at 56.50 or higher. As an options trade consider the June 52.5 Calls ($1.50) and trade them like the stock trade. Offset some cost by selling the June 55 Calls (35 cents) for a Call Spread. Give the stock more time with a July 52.5/June 55 Call Diagonal ($1.65, buy July and sell June) and sell the July 50 Put (45 cents) to add leverage and lower the cost.

Fortress Investment, Ticker: $FIG

Fortress Investment, $FIG, is a bottoming and reversal trade from 2 perspectives. First the RSI has bottomed and is turning back higher, after making a lower low, while price has not made a lower low. This is a Positive RSI Reversal set up and targets a move higher to 8.90. Second the price action can also be viewed as an AB=CD pattern with that same target. The MACD is also kinking back higher towards a bullish cross. Notice the 200 day SMA near by that has acted as support previously. That is the initial stop. There is resistance at 8.30 and 8.55. Support lower comes at 7.70 and 7.45. Short interest is low under 2%. Enter long now (over 7.65) with a stop at 7.55. As it moves over 7.95 move the stop to break even and then to a 30 cent trailing stop over 8.05. Take off 1/3 on a stall at 8.90 or higher. As an options trade consider the June 7.70 Calls (30 cents) and trade them like the stock trade. if you need to give it more time then you can roll up to the July 8 Calls later.

Finisar, Ticker: $FNSR

Finisar, $FNSR, rose in a channel from October through to mid March. After that long run it pulled back slightly and has consolidated in a sideways fashion under resistance at 21.70. That was until it pierced through Friday. Now the Bollinger Bands® are angling higher and the RSI is bullish and rising with a rising MACD. There is resistance higher at 23.25 and a gap to fill to 24.91 before 25.40 and 28.40. There is also a Measured Move higher to 29.30. Support lower comes at 21.15 and 20.30. Short interest is high at 9.2%. Enter long now (over 21.20) with a stop at 21. As it moves over 22.30 move the stop to break even and then to a 60 cent trailing stop over 22.50. Take off 1/3 on a stall at 25.40 or higher and by 28.40. As an options trade consider the June 22 Calls ($1.10) and trade them like the stock trade. Give it more time with the July 22 Calls ($1.25) and offset some cost by selling the June 24 Calls (25 cents) and or the July 20 Puts (45 cents).

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