Top 5 Trade Ideas For The Week Of October 22, 2012
Dragonfly Capital | Oct 22, 2012 01:20AM ET
Aetna (AET) is building a bull flag just under resistance created by the gap down in April. The Relative Strength Index (RSI) is working off the technically overbought condition while the Moving Average Convergence Divergence indicator (MACD) is positive but fading, which is normal in a flag. A break of the flag higher carries Measured Moves to 46 and 50. This stock reports earnings Thursday morning.
Cerner (CERN)
Cerner (CERN) is testing support for the third time in 3 months, and just above the gap up from February. The RSI is bearish and running lower with a MACD that is negative and growing. All signs point lower. A gap fill would take it to 63.21 and the 3-box reversal Point and Figure Chart (PnF) carries an even lower price objective of 60. This name reports Thursday after the close.
Comerica (CMA)
Comerica (CMA) is moving lower with expanding Bollinger bands, a RSI that is bearish and falling and a MACD that is negative and growing. The price by volume shows that there is a void under 28.80 as well. Ugly.
Covanta (CVA)
Covanta (CVA) broke above the consolidation zone and back tested that break out Friday. It has a bullish RSI and a MACD that is positive to support more upside. The channel break carries a target higher to 18.75.
Gilead Science (GILD)
Gilead Science (GILD) is testing support within a consolidation zone. The RSI is still in the bullish zone but is retreating fast with a MACD that is negative and growing, both supporting a downside push. This name reports Tuesday after the close so take profits if it moves before then or wait.
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After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Original post
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