All Entries in the "Technical Analysis" Category
TRIP Ready to Stumble
August 31, 2012 at 3:09 pm
TRIP saw a big negative change of character in late July with a big downside gap on heavy volume. The initial recovery attempt fell right on its face with the creation of new correction lows just three weeks later, highlighting the importance of avoiding the long side after a trend shift.
Currently, the stock is wedging beneath former support after bounce attempts in the past two weeks have proven unable to reclaim the $34.75 area. The rebound is looking stalled-out, and now price is beginning to weaken. A break of the lower rising trend line of this wedge would occur around $33.10 to be sure, and would likely usher in lower prices in the coming weeks.
Here’s a closer look at the chart of TRIP for you:
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Jeff White
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Wait to Place Bets on LVS & WYNN
August 30, 2012 at 11:28 am
Casino stocks have seen a marked improvement in their price action over the past month. A couple of them looked like death, but alas, they have perked back up and shifted their path of least resistance.
Two names in particular are LVS and WYNN, both of which have seen very constructive price action in recent weeks with upside momentum as well as rest phases – a very bullish combination.
I caught an excellent swing trade in LVS (which I shared with members) on Aug. 16 as the stock pushed past a descending trend line at $39.75 to begin another leg higher. That was worth a quick $4.05 to us as just 5 sessions later it hit Target 2 at $43.80, proving to be a timely exit.
Since then, it has given up a couple of points with some mild profit taking, but remains overall bullish. The stock may need a bit more time before it’s ready to rise again, but it belongs on the radar. The next move may not be quite as smooth, but a longer-term trend change looks to be in the making with a considerable cushion in place between current prices and the July low.
Here’s a closer look at the chart of LVS for you and the levels to keep an eye on:
Another name in the same group is WYNN, which has seen a similar shift of character in recent weeks. Following a breakdown from the May-July trading range, the stock worked its way back into the range and early last week pushed past the upper boundary to create a higher high.
Since then, we’ve seen a quiet retreat but no negative character change as of yet. The current pullback could quite feasibly result in another short-term higher low (vs. $99.09 on 8/15), keeping the 4-week uptrend intact. Next it would need to close above the June high ($107.57) to confirm an exit from the channel, and then it’s got ample room to run higher to retrace the May selloff.
Here’s a closer look at the chart of WYNN for you and the levels to keep an eye on:
Each of these are showing signs of life again after harsh corrections from their spring highs, but may need a bit more time before they’re set to go. Keep them on the radar.
Trade Like a Bandit!
Jeff White
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Confirmed Trend Change for VZ
August 29, 2012 at 10:21 am
The double top pattern – like the double bottom pattern – is over-diagnosed. Anytime a stock challenges a previous high, the amateur technician jumps at the chance to declare a double top in the making. And generally they’re premature in doing so.
But the professional takes a different approach.
Rather than seeking to be the first to recognize a trend shift, it’s better to wait for confirmation of that change to come along. And in the case of the double top pattern, that requires a break of the reaction low or pullback low which was established between the peaks.
A stock fitting this description right now is VZ, which just confirmed not only a double top but has also offered an additional layer of importance by failing to reclaim former support on the bounce.
One other note is to take a look at the 2nd high on the chart on Aug 1. Price touched the previous high to the penny (not a requirement for a double top, by the way) and failed to clear it, but something else happened which was noteworthy: the finish for that day was much weaker than the day when it initially marked a high (July 18). This is another thing to watch for which might offer clues that a stock is perhaps running out of steam and deserves a closer look going forward in anticipation of a potential trend change.
Going forward for VZ, the path of least resistance is down, at least until the $43.40 area (lateral support/resistance) is reclaimed on a closing basis. That’s the level which can now be traded against. The stock looks to have next support around $41, which was a level of importance back in May.
Here’s a closer look at the chart of VZ for you:
Be careful jumping to conclusions about double tops or bottoms. Instead, be patient enough to wait for confirmation of a trend change so you can trade with greater confidence of the direction.
Trade Like a Bandit!
Jeff White
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Up 10 of 11, SPY Still Not Extended
August 20, 2012 at 9:24 am
SPY has made a nice run since early August when a Monday-Thursday pullback was followed by a Friday lift which erased the 4-day slide. We’ve seen consistent follow through since then as well, sending the SPY into Monday having posted gains in 10 of the previous 11 sessions.
A run like that is never something to discount, and if blindly I heard a stat like that, I’d be highly cautious. But in this case, it hasn’t left the SPY extended. It’s up 4% during that time, but the way it has happened has been healthy. The early portion of the run was rapid, then we settled into a rest phase. That pause lasted 5 days, yet SPY only gained $0.46 during that stretch. There was even a decline of a whopping $0.07 (Aug. 13), which isn’t the kind of a reaction the bears can be proud of.
To see this major ETF posting so many advances of late would ordinarily be a bit scary. Technically though, it’s been a sharp rally, a healthy rest, and then some continuation. Why would that be something to fade?
We’re facing 52-week highs in the SPY and S&P 500, but they both still have room to run if the bulls feel so inclined. We may turn lower and this run proves to have been a great selling opportunity. However, the bulls have created higher lows on every single pullback since the June low, and that deserves respect. I’m not about to bet against them.
Here’s a closer look at the chart of SPY for you:
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
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TC2000 Club
June 25, 2012 at 3:34 pm
I’ve been a user of TC2000 charting software since 1999. I believe it’s the best, and it keeps getting better, so it’s no wonder I’ve stuck with it.
One element Worden has maintained all along is the Clubs feature. Through clubs, you can access various items from the club owner. I have my own TC2000 club in which I share charts on a pretty regular basis. I may point out setups which offer some kind of lesson, or they may be setups I’m watching for upcoming moves. Either way, they’re free ideas for those inside the club. By the way, the club is free to join – you simply have to be a TC user. Then anytime I share charts, you see them!
To join TheStockBandit Club, just visit www.TC2000.com/TheStockBandit and click the “clubs” link at the top of the page for instructions to join.
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
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Video Review of the Indexes 5-6-2012
May 6, 2012 at 3:48 pm
Last week the indexes finished red despite having moved higher earlier in the week. Key levels were approached but the senior indexes were unable to clear them, prompting traders to raise cash.
We caught some nice trades on the week, so in case you missed the recap be sure to check it out.
In preparation for the trading week ahead, let’s examine some important levels to keep an eye on for the indexes. That will have the greatest influence on how individual stocks are going to move, so it’s part of our weekend process.
Selectivity remains the key for new plays, which I’ve been noting for subscribers of our stock pick service.
Be sure to view in HD (720P) and full-screen mode for best quality in the video.
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
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Week 18 Trades Review (Video)
May 6, 2012 at 3:41 pm
Week 18 is in the books, and overall it was a solid week of trading. Despite not taking a lot of trades, it was a profitable week thanks to caution on the long side and some shorts which fared well in the decline.
I wanted to offer a video recap of the trades just as I have so far each week this year. This should give you a feel for not only how I managed my trades, but also the kinds of setups which have been working well of late.
For those curious about our trading style in the member area, this should give you a good indication of what a typical week looks like. Check out the free trial to our stock pick service if you’re interested in adding our ideas to your own.
Be sure to view in HD (720P) and full-screen mode for best quality in the video.
Trade Like a Bandit!
Jeff White
Producer of The Bandit Broadcast
Get our free newsletter to keep up!
Follow @TheStockBandit
