Top Trade Ideas for the Week of March 7, 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 Saturday which looks in the short term to bring new highs for Gold and Oil, with a chance of consolidation within the coming week. The US Dollar Index looks to be headed lower with US Treasuries fate determined by the 20 and 50 day SMA’s. Chinese and Emerging markets look better bid. The Volatility Index appears to be drifting higher with a broader range creating some uncertainty with the broad market Equity ETF’s. The SPY, IWM and QQQQ all look like they have more consolidation in store for them this with a bias to the downside, although within the context of a continued strong uptrend.

(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:

BP, Ticker: BP

BP has been steadily rising since destroying the Gulf of Mexico. It is now approaching previous resistance at 49 from January. If it can get over 49 then it has resistance higher at 51.65 and then 55. The rising Simple Moving Averages (SMA’s) and Relative Strength Index (RSI) support a bias to the upside. The rising trend line can be used as a stop for entry before 49 if aggressive.

Covidien, Ticker: COV

Covidien has had a steady trend higher since September. It just broke through resistance from the previous high at 51.95 and now has resistance at 54.70 from 2008. If it can get through there then the target on a symmetrical Measured Move (MM) to the last run higher is at 62. The RSI is firmly in bullish territory, the Moving Average Convergence Divergence (MACD) indicator is increasing and the SMA’s are all sloping higher supporting a move up.

EnergySolutions, Ticker: ES

EnergySolutions is consolidating near resistance at 6.84 If it can get through it then it has resistance at 7.25 followed by 7.70 and then 8.20. The RSI is rising and the MACD is now improving.The 50 and 100 day SMA’s are sloping higher and trying to pull the 200 day SMA up as well.

FirstMerit, Ticker: FMER

FirstMerit trying to hold support for the fourth time at 16.40. If it fails then there is some support at 16.20 before it would seek a target on a MM to 14.40. If it holds then the 17.25 area is resistance followed by the SMA cluster from 17.85 through 18.16. The MACD appears ready to rise and the RSI has held the technically oversold line for now, but the SMAs’ are all sloping down. Biased to a breakdown.

Newcastle Investment, Ticker: NCT

Newcastle Investment looked so great a week ago and then crapped out immediately. It is now back at support of the rising 50 day SMA where it rose from the basing of January into February. Using 50 day SMA as a stop, look for a rise to resistance at7.91 and then 8.25 after that. The RSI and MACD are not in favor of this, diverging from the rising SMA’s, so keep the stop tight.

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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