Heading into trading on Thursday here are 5 Stocks for the Next 5 Days. Note that 5 ETFs for the Next 5 Days has been included in today’s stock report below.
^DYN^
Shares of DYN were up more than 1% on Wednesday. The stock has been trading below its 200-day moving average since the first day of August, fell to a low of 3.54 on August 19th and has been moving higher in a race to the 200-day moving average ever since.
DYN has closed in overbought territory below the 200-day for five consecutive traders, each close higher than the last and each high higher than the last. Shares of DYN have PowerRatings of 1.
^LIZ^
Shares of LIZ opened on Wednesday with PowerRatings of 3, but earned a one-point downgrade over the course of the trading day as the stock gained below the 200-day moving average.
Wednesday’s gain in the stock of more than 2% was enough to push LIZ into overbought territory below the 200-day. Note that Liz Clairborne has been trading below its 200-day on a consistent basis since early August.
^NVDA^
Rallying on the back of a strong earnings performance, NVIDIA Corporation soared by more than 8% to finish trading on Wednesday in overbought territory below the 200-day.
NVDA closed higher for a second day in a row, following a three-day pullback.
^IR^
Also up after a short-term pullback were shares of Ingersoll-Rand Ltd. ^IR^.
Ingersoll-Rand Ltd. gained well over 4%, finishing at a new 10-day closing high below the 200-day moving average. Shares of IR have traded below the 200-day since mid-July.
^LH^
Also up more than 4% ahead of trading on Thursday, LH finished at its highest closing level in more than a month. The stock, which has been trading below its 200-day moving average, ended higher for a second day in a row on Wednesday and is set to open on Thursday just inside of overbought territory.
Shares of LH opened on Wednesday with neutral PowerRatings of 4, but earned a one-point downgrade over the course of the trading day.
The above 5 stocks have advanced toward levels from which they have historically reversed and moved lower based on our research into short term stock price behavior. Click here to learn more about our research into short term stock trading in the book by Larry Connors and Cesar Alvarez, Short Term Trading Strategies That Work – now available for free both in paperback and as a digital download (pdf).
There will be no 5 ETFs for the Next 5 Days column this week. Note however that a number of major equity index ETFs have rallied toward levels from which they too have historically reversed and headed lower.
Examples of these exchange-traded funds include the ^QQQ^, the ^SPY^, and the ^IWM^. Additional strength in these funds will likely put them on the radar of high probability traders looking for markets to sell short.
Also of note are increasingly overbought international funds trading below the 200-day moving average such as the ^RSX^ and the ^FXI^.
David Penn is Editor in Chief of TradingMarkets.com