Feb 13 Bullish Breakout and Trending Stock Scan
As logically expected and as I highlighted to members last night, stocks continued their short-squeeze directed creep higher, trading just shy of the 2,100 round number level.
We’ve come down from divergences so far but let’s plan the rest of the session.
We’ll update our key levels, highlight the divergence, and of course note trending stocks today:
Let’s start with an update from the prior update on the current range and breakout targeting for the S&P 500.
It took about a month to occur, but price FINALLY managed to break above the upper resistance line near 2,070.
This instantly triggered a short-squeeze (short-sellers taking their stop-losses) at the same time buyers (bulls) added to existing positions or put on new bullish breakout positions.
Today’s action continued what began yesterday as strength carried over into today’s session.
The key focal point is 2,095 (the high) and 2,090 (where we are currently).
The divergence doesn’t bode well for buyers, but assume trend day continuity UNTIL price breaks under the rising 50 EMA (5-min chart above).
Let’s see what our Breadth Chart reveals about current market strength (or weakness):
Unlike yesterday when breadth was across the board bullish, today’s reading is muted and neutral.
First, Financials (and Staples) are underperforming while Utilities once again shows almost NO stocks positive.
The strongest sector is Energy followed by a group of 70% performers in the Offensive Sector Grouping.
We have potential bullish trend continuation plays in the following stocks from our scan:
VF Corp (VFC), Colfax (CFX), GlaxoSmithKline (GSK), BHP Billiton (BBL).
Potential downtrending candidates exist in stocks showing relative weakness today:
DaVita HealthCare (DVA), PG&E (PCG), DTE Energy (DTE), and Ambarella (AMBA).
Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.
Corey Rosenbloom, CMT
Afraid to Trade.com
Follow Corey on Twitter: http://twitter.com/afraidtotrade
Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).
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