Some Nice Runs

• December 5, 2001
• Dave Floyd

The string of
narrow-range days was finally broken as the S&Ps and especially
the Nasdaq caught fire and made nice runs right into the close.  The
S&Ps were particularly impressive as the 1137-38 level was once again
breached and is now a healthy 10 points above. On shorter time frames, as well
as from a daily perspective this is quite healthy technically. The underlying
stocks saw action as well, especially if you were trading in the story stocks or
“hot” sectors, mainly the
(
$SOX.X |
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PowerRating) and its predominant
components.

The S&Ps, as seen on the hourly
chart below closed impressively above their 50% retracement, as well as breaking
out of a descending triangle, and are poised to continue higher.

The Nasdaq hourly chart has offered
some great technical set-ups over the last few sessions, and with today’s
impressive close above the right shoulder and a breakout of a descending
triangle, higher levels may not be far off.  I want to thank one of our
traders, Todd Gordon, for sharing that with me this morning.  Nice chart
work, Todd.

The other indices are also once again
within striking distance of going back to the recent highs set a couple weeks
back, those numbers being:

Barring any unforeseen
“bombshells,” which seems unlikely given that we are in the middle of
a bull love fest not only from a technical standpoint, but because Cisco
(
CSCO |
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PowerRating) is in the midst of their two-day analyst meeting, Intel
(
INTC |
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PowerRating) will be making some announcements on Thursday and the Fed caps it
off with an interest rate policy meeting next week. 

With that in mind, I came across a
couple of stocks which are exhibiting nice technicals, one from a long
perspective, the other from the short side.  I like both of the charts but
depending on your thoughts on where the overall market is heading, I would then
choose accordingly.  Remember, you want all possible edges when
establishing positions regardless of time frame.

Darden
Restaurants
(
DRI |
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PowerRating), based purely on its technical pattern looks
intriguing.

Alliant
Techsytems
(
ATK |
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PowerRating), same situation as above, many of the technicals
I look at on daily charts are not pretty on this stock

.

Remember, these two stocks are
highlighted as longer-term plays, days to weeks, not intraday trades.  As
always use protective stops.

Key
Technical Numbers:

As always, feel free to send me your
comments and questions.  See you in TradersWire.

Dave