27 Oct Weekly Stock Trading Advisory Report
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FREE STOCK TRADING IDEAS AND MARKET TREND FORECASTS WEEKLY REPORT
Weekly Forecasts and Swing Trading Ideas Report: October 28th
Each week we put out an initial list of 10-18 Swing Trade ideas for our SRP Members and Stockreversals.com Members as well. Although not a full on comprehensive list of all of our ideas, we often will pick 1-2 from this list as actual alerts during the week for our SRP Members if warranted or market conditions or news flow dictates. The list is below the charts in this report.
We also have Updated Weekly views of the SP 500 Index. It was another week of heavy declines for the markets, with most the major indexes down 3% or more for the week ending Oct 26th. The SP 500 finished the week down -3.9%, with the Russell 2000 down -3.8%, Nasdaq 100 down -3.6%, and the Dow down -3.0%. It’s important to point out that 4 of the last 5 weeks have been negative for the SP 500 (with the only positive week being up less than 1 measly point!). This is some heavy selling action that won’t last forever, and this week showed continued signs of bottoming for the bulls.
As mentioned in last week’s report, “we’re looking for a break of last week’s high or low to determine short term direction.” Sure enough, price broke previous week’s low and sliced through the 2710 level, ultimately bottoming at a low of 2628 for the week. We see a perfect 1:1 symmetry from the Jan/Feb decline at 2600, if the market wants to test that round number, with additional fib targets just below.
At this point there are major positive divergences on the Summation indexes, RSI, and even the VIX. Even the Fear/Greed Index has been in single digits all week. As mentioned, the selling won’t last forever, and in fact, it’s gotten to the point where there have not been back to back positive days for the SP 500 since Sept 19 & 20!!
Bigger picture, we are awaiting the larger bounce as we enter the seasonally strong period from Oct-Apr, more importantly the holiday window during Nov-Dec. Assuming 2628 was the low, we would expect the markets to retest the .50-.618 retrace of the entire leg from 2940-2628, so a minimum of 2784 to 2821 would not be out of the question. That would be approximately 4-6% higher from Friday’s close of 2658.
Biotech (XBI) had a washout low with other markets this past week, but closed relatively strong still in the support zone. We will be watching for our NASI buy signal to feel confident in an interim bottom in this sector.
The markets have essentially been negative for 5 weeks straight, which is stretching the probabilities for more downside, so we believe the risk is to the upside here. We have been between 80-90% cash in our swing trade model for a few weeks now, but will be issuing a number of swing setups over the coming days and week.
If you aren’t yet a member of our Premium service, please consider joining since we’re likely to put out a number of great swing trades over the coming weeks. THIS IS A GREAT OPPORTUNITY TO GET ON BOARD given the washout selling that has occurred the past 4-5 weeks. See our track record and more at Stockreversalspremium.com
We use a combination of behavioral analysis along with the technical and fundamental approach to identify reversal pattern opportunities in stock swing trade setups in addition to our high regarded macro market forecasting.
SP 500 Charts:
Biotech (XBI) Chart:
Swing Trade Candidates: Each week we provide 8-15 Swing Trade ideas to consider as part of our SRP service. We often pick a few from the list during the week as actual alerts. This week we have 15.
WWE- Washout selling to 34 week EMA, worth a look at a bounce to 75-80, producer of Pay Per View and Media programs related to wrestling
MTCH- 10 week base, holding above the big Aug gap candle. Above 46 and we think 54-56 is achievable. Provides dating products in over 190 countries online.
BURL – Strong relative strength last week, up 10%. Good buy if we get consolidation this week. American national off-price department store retailer.
GOGO – up 5% last week, still breakout, consolidation stair step pattern. 7-8 price target not out of question near term. Provider of in-flight broadband Internet service and other connectivity services.
BA- 10 month base pattern; earnings recently were strong, and held up fairly well through the last 4-5 week selloff with the markets. American multinational corporation that designs, manufactures, and sells airplanes, rotorcraft, rockets, satellites, and missiles worldwide.
MOMO – ABC correction completed this week. Perfect 1:1 symmetry and bounced. 38-40 would be likely if the markets get off the ground. Chinese provider of mobile social networking platform.
PLNT- Consolidation last week, bouncing between the 13/34 weekly EMAs. Coiling for higher. Monthly uptrend still remains strong. Operator of over 1500 fitness centers.
TMO – breakout and backtest, closing strong. Company provides analytical instruments, equipment, reagents and consumables, software, and services for research, manufacturing, analysis, discovery, and diagnostics.
SAVE – Strong outperformance vs. SP 500 last few weeks. Up 3.5% last week. American ultra-low-cost airline carrier.
LTHM – strong post IPO bounce this week; Manufactures and sells performance lithium compounds that are used primarily in energy storage, specialty polymers, and chemical synthesis application.
AAP – 8 week consolidation, could be sector rotation going on. Retailer of automotive parts and accessories.
SFM – 8 week consolidation cup & handle forming within a larger 2 year base pattern. Break above 28.12 opens up 30-33 level. Attempted breakout last month. American supermarket chain.
SUPN – 7 week consolidation pattern, holding range on monthly timeframe. Specialty pharmaceutical company focused on developing and commercializing products for the treatment of central nervous system (CNS) diseases.
WHD – Forming ABC correction, bouncing off 34 weekly EMA. Wellheads and pressure control equipment.
MKC – All time high breakout last week, and any pullbacks should be bought for continuation. Company manufactures, markets and distributes spices, seasoning mixes, condiments and other flavorful products to the entire food industry.