Looking Ahead
Each evening we focus on the most interesting aspects for the upcoming trading day. The comments are based on observations of the nightly updates of the Stocks/Sectors and Market Bias pages. They are provided for educational purposes only and are not intended to be direct trading advice. Also, keep in mind that these remarks are made up to 12 hours in advance of the markets opening. Therefore, overnight events may alter the outcome of these observations.
Wow, what an end to the week! The S&P and NASDAQ hit and closed at all-time highs and the Dow Jones is just spitting distance away. However, I’d use caution on Monday as the indices did “tail off†(closed off of their highs). This means that traders are willing to take profits into new highs. This tail is especially evident in the December NASDAQ 100 futures [NDZ9>NDZ9].
Often, some of the best cup and handle patterns are bigger picture patterns on stocks which have already doubled or tripled in value. With that said, Centurytel [CTL>CTL] has begun to rally (a) out of a big picture cup and handle. What’s more interesting is the weekly chart which shows the stock’s longer term stellar performance and a handle forming on a weekly cup (b).
Other stocks of interest on the Cup and Handle List include AT&T [T>T] which has formed a low level pattern and CSG Systems International [CSGS>CSGS] which looks poised to rally out of a mini triangle.
Portal Software [PRSF>PRSF], on the Pullbacks List, closed well today and looks poised to resume its strong uptrend.
For you breakout players, CheckFree [CKFR>CKFR], mentioned over the past few nights (see archives), broke to new highs on an expansion of range again today. Continue to look for a buying opportunity here or better yet, wait for the next pullback. National Semiconductor [NSM>NSM], on the Momentum 10 Technology List, also broke to new highs on an expansion of range today.
Best of luck with your trading on Monday!
PS – Reminder: Protective stops on every trade!