Don’t Count Your Chickens Before They Hatch
The biotechs have been the
talk-of-the-town lately, but look what’s just overhead — resistance.Â
Today’s Watchlist:Â Â
(
JDEC |
Quote |
Chart |
News |
PowerRating),
(
PRGN |
Quote |
Chart |
News |
PowerRating),
(
EPNY |
Quote |
Chart |
News |
PowerRating),
(
GSPN |
Quote |
Chart |
News |
PowerRating)
The green line on the charts is the
20-day MA and the blue line is the
50-day MA.
JD Edwards
(
JDEC |
Quote |
Chart |
News |
PowerRating) is finally moving
higher after spending a few weeks basing. It’s been in an uptrending channel for
some time now. Of course, we do not know if this channel will continue or become
a bearish flag. Since I’m sure that everyone read the Baker/Ten Electronic
Trading Course, there is no need to explain how to trade a channel. (In case
you forgot, this setup is covered in Week Three).
Peregrine
(
PRGN |
Quote |
Chart |
News |
PowerRating)
finally broke one of its downtrends. Just overhead we see strong a resistance
area formed by the 50-day MA and an old trouble spot from June. Because the
market is weak, traders might want to look to play a failed move over
resistance. Watch for PRGN to run into resistance and then pullback. Although I
tend to focus on playing breakouts and breakdowns, sometimes I like to play
bounces of trendlines, particularly when support or resistance is created by
two lines.Â
If the stock is strong and
can close above this resistance area, you might want to watch for a continuation
move to provide a long opportunity, but beware of resistance points near 35 and
38.
e.piphany
(
EPNY |
Quote |
Chart |
News |
PowerRating) has been consolidating for roughly two
weeks. What draws my attention to this consolidation is the fact that the volume
continues to slow. Low volume can often signal the end of a consolidation and
forecast an upcoming move. It does not tell us which direction it will move,
but simply that something is coming. Thus, we will watch EPNY for a move outside
of the current trading range. If you go long on a breakout above 99, watch for
resistance at 100 and 103, the latter being the 20-day MA.
Globespan
(
GSPN |
Quote |
Chart |
News |
PowerRating) tested resistance for a fourth time on
Wednesday. It has also picked up the trendline that started in late May. Now
that it’s following the trend again, it may be driven above this resistance level
that’s holding it down. Watch for a continued series of higher lows to signal a
potential move above resistance. Should you take a position on a breakout, look
for resistance at each of the intraday highs in mid-July.
Until later,Â
Check back at 2:00PM ET
for Trading the Techs PM.