Retracement Candidates from 12 Stocks Extended 10 Days Straight Up

Nov 6, 2014: 1:45 PM CST

An amazing 12 stocks in the S&P 500 have traded ten days straight up – and may be ripe for a pullback after such a stellar rise.

Let’s chart these names which may be attractive to aggressive traders as a short-sell potential candidate list:

This list highlights the most overextended stocks, defined by those which have closed the most consecutive days higher.

Some stocks are already forming reversal candles during today’s session, and may be pulling back like EBAY, American Express (AXP) and T. Row Price (TROW).

Keep in mind that shorting an extended rally – trying to capture a piece of a potential downside retracement – is an aggressive strategy.

Stocks that are extended 10 days in a row CAN go on to extend 11 or more days to the upside – remember these once were candidates that were over-extended 8 days in row… and then 9… and now 10.

Nevertheless, it’s a simple method to find potential candidates for aggressive traders.

Study each stock individually – this chart pulls the perspective back to a larger view:

Study the trend, volume (look for clear negative divergences), reversal candles, breaks of steep rising trendlines (you may need to drop to an intraday chart to spot the trendlines better), and any other information such as prior resistance levels (such as the $71.00 level for Harris HRS).

Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
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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).

1 Comment

One Response to “Retracement Candidates from 12 Stocks Extended 10 Days Straight Up”

  1. Meghrom Says:

    Frankly speaking, I don’t prefer trading on these stock, as it’s pretty risky thing to do instead I prefer to work on currency pairs which are far more profitable and less on risk. I also get advantage of low charges by my broker OctaFX, as they got low spread of 0.2 pips for all major pairs, so that definitely helps in working smoothly and get my chances of success so much higher as compare to stock or with higher spread that most brokers charges.