Category Archives: Patterns

Four Trending Stocks to Watch

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Medidata Solutions, Inc. (MDSO) climbed to a new all-time high of $73.15 on Monday, closing the session up $2.08, or 3%, to $72.76, on 455,600 shares traded. The cloud technology stock has been stair-stepping up a rising channel over the last few months and has popped $4.57 since Wednesday’s close. The next target is near the channel top at around $79-$80. Short interest of 7.9 times its average volume could fuel the move as shorts cover on a rally.

Mimecast Limited (MIME) popped another $1.10, or 4.25%, to $27.00, on 388,800 shares traded. The advance up came as the email security company’s CEO and CFO spoke at J.P. Morgan’s technology conference in Boston. Despite no dramatic increase in volume, the stock’s technicals look positive, climbing steadily since early March and holding support on the pullbacks. Watch for price to exceed last week’s all-time high of $27.25 to reach $30-31 in the short term.

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Back On The Three Day Rule

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SPX resolved higher yesterday and the cycle trend day delivered a unidirectional day dominated by the bulls, though not making any new speed records of course. Today is the other cycle trend day this week but as yesterday’s cycle trend day delivered, that less likely to deliver today, and the day has been a two way trade so far.

SPX delivered strong closing breaks above the important resistance levels yesterday and at the time of writing they are the 5dma at 2379-80, the 50 hour MA at 2387/8, and the daily middle band at 2390.

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Decision Time

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The three levels that I was watching on Friday for resistance on SPX were all tested and held. The lowest of those levels are the 5dma, currently at 2379/80. That was broken intraday but SPX returned to close on it. The next level is the 50 hour MA, currently at 2385/6, and then the daily middle band, currently at 2389/90. SPX is currently over all three but needs to sustain the breaks to open the retest of the all time high.

The pattern setup leans bearish and hourly sell signals are now brewing on all of SPX, ES, NQ and TF. If bears can break back below the ES monthly pivot at 2366 then we’ll be expecting lower lows with an obvious next target at possible double top support at 2322 SPX. (more…)

Backtesting Broken Support

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I was saying yesterday that my preferred target for this rally would be a backtest of the daily middle band on SPX. That’s now at 2388.50 and the high today at the time of writing is at 2384.41, so obviously SPX is now in the backtest area. The 60min buy signals on the SPX, ES, NQ & TF charts have now all made target and this is an obvious inflection point. On a reversal back down here the next target on SPX is larger double top support at 2322. On a break above with confidence the obvious next target would be a retest of the ATH and likely marginal new ATH.

Are there reasons to think that bulls may drive SPX through resistance here? Yes there are. Firstly the action so far on SPX/ES is very trendy so far, and I have valid IHS patterns on ES, NQ & TF that are all pointing higher, though in the case of ES that’s only marginally higher to the weekly pivot at 2390.50. (more…)

So Here We Are

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Yesterday’s call for a marginal higher high and rejection worked out ok (buffs fingernails modestly) , even if yesterday afternoon was seriously dull. So now what? Well the first double top target on SPX at 2356/7 has not yet quite been made and that should be tested either this afternoon or tomorrow before we see a likely rally from that area. After that we are looking for a move that should test main double top support at 2322. More details on target areas and support on the charts below. SPX daily chart:

170517 SPX Daily

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