The market has had a strong two days in a row and a straight up run since 1/31. This has put many stocks in very extended patterns. For longs I like to favor stocks but will be selective on buying breakouts on anything that has move significantly away from a daily breakout without a correction of a day or two.
Ben Bernanke will be testifying in congress today at 10:00 which could impact the markets.
Long Focus
MCP: Yesterday it broke out of a daily flag pattern, and had great intra-day volume patterns. Please look at the 5 min chart and note the big volume bars followed by continued upward movement. There is key daily resistance at 56.08, and R2, 58.13 lines up with the low of the high daily bar at 58.28. Key daily support at daily highs of 53.80 and 53.00. The FTP is 54.13 which lines up nicely with the consolidation late yesterday.
* Trade breakouts above the FTP, 54.13
* Trade OR Reversals above S1, 52.76
BIDU: Has and inside day and nice consolidation on the 60, and a positive pivot stack. If it gets momentum I’d follow it. I would not buy weakness.
* Buy breakouts over the FTP, 119.42. Breakouts would be better if over prior day high of 120.16, and/or the high of the daily consolidation of 120.50. Note R1 is 120.59 so that could be a key area today.
NOC: Had a strong close and was the first day of a breakout look at the ROK chart from yesterday and you’ll see the game plan for NOC today. Key daily support is at the 2/7 high of 70.65 to intra0day low of 70.53, and that lines up with the FTP at 70.72. Additionally the daily swing highs where around 70.35 and S1 is 70.30.
* Trade breakouts over the FTP, 70.72
* Trade OR Reversals above S1, 70.30
Other interesting long charts: AAPL, FTNT,WLP,MMM,ROK, WFC, PNC,CMG, SHLD, FSLR, COH, WYNN, TSCO
Short Focus
APA: with basically 2 inside days in a row this stock is wound up for a nice move. I’d only follow it down, and I’d wait for a break of yesterday’s low, 117.04, but really below 117.00, AND S1 is 117.01. There is daily support at 116.46 and S2 is 116.52. A good target would be 114.00.
* Trade OR breakdowns below 117.
* Trade OR failures cautiously. I’d like them to line up with a key level such as R1 and yesterdays high both at 118.05 area, or R2 at 118.54, or high of outside day at 118.93.
FCX: Was weak again in a strong market yesterday, but held the prior low area of 55 and it is consolidating on a up sloping 50-day MA. I’ll look to if for shorts, but realize that strength is coming off a consolidation low.
* Trade OR breakdowns below prior low of 55.00. S1 is 55.07. There is a gap that gets filled at 54.50 and R2 is also 54.50 so that is a big support area.
* Trade OR reversals cautiously. There should be good resistance at 56.20 area as that is R1 and intra-day swing low.
Other potentially interesting short charts: JRCC, AMGN, CTXS, SLXP
