As a refresher, in my last post I had mentioned INCY, ILMN and MNMD as stocks I am watching. You can see my initial assessment of these stocks from my last post, but here are some updates on how I would trade them.
INCY was a short idea. This is stuck in this small range attempting to base. The past 3 days show a strong bullish candlestick pattern off the lows. This pattern also managed to close at the high end of the range today, so it now looks like it wants to break out. I still think my initial assessment of the strength of the stock as it hung around this area for a while, but the dip buyers seem to think it’s a steal down here and providing strong support. If this does break out it has room to run between 66 and 68. I’d look to get back in between 68-71 area as I think it will test those lows again soon enough at which point I’d expect it to start breaking down.
ILMN was a short idea as well. This is going slightly better as it got to the low end of the massive range and is really trying to get some bounce. But this is being met with very very strong resistance at that 20 day moving average. In each of these little volatile bounces you can almost hear the gasping for air as this slowly gets pulled under. I think a big break down is imminent. I’d pick that 20 day average as my stop zone and start building a short if not already in position.
MNMD was a long idea of mine. This worked out beautifully in the short term and hit my first target at $5 on Tuesday and has pulled back as I had expected. I think this may be searching for a base here at 4.50. If this starts to break down here, though, then this may have shot its wad and it’s time to close the rest of my position. I did take profits up near $5, but if I do see a successful basing pattern here then I may get back in with more size. Potential target zones remain $5.50 and $8 if this can manage to continue.
As for new stocks I am watching:
CAR, short idea. This is a simple range trade. It goes up, it goes down. Now that it is done going up, I think it will go back down. This has already pulled back a bit far from the resistance area at 245 as it gapped down today (Tuesday/Wednesday was really the time to get short), but that doesn’t mean you can’t take advantage. I think it should make for good day trading to look for intraday or short-term bounces into resistance spots to get short and ride it down. I think at minimum this wants to drop back to 200 before the waters get muddied again.
SAVA, short idea. This is both a longer term view and shorter term view to explain why I think this is a good short going into the next few months. First, the long-term view, this was a meme stock to begin with. IT had a joyous ride up after 2021, but now that has fizzled and is just drifting along this support level around $21 and it can’t get up off the ground. The shorter-term chart is to show how this attempted to escape this downtrend twice and failed. The most recent attempt was rejected by a very bearish engulfing red candle. If this manages to break down, initial target is $14 area (about 33% drop) followed by $7 (66% drop from here!). That last target area might be a stretch, but $14 is very much within the realm of possibility.
G, short idea. Showing this on a weekly chart to emphasize the weakness relative to the 200 Week moving average. Since 2011 this has had a few dips beneath there which were bought up very quickly every time (even the COVID crash spiked right back up above this average). But now? This dropped beneath that average and is having lots of trouble stabilizing. It is developing a short term range to be sure, but I’d watch for an eventual breakdown, possibly heading back to those COVID lows. Like other stocks on my list I mention in this post, I wouldn’t just jump into a position, but I’d pick shorter term setups to ride this down.
GE, long idea. This is a bit of a boring one, and for a boring reason too. It is simply riding this wave up on top of this 20 day average. So…buy and hold until that stops working. Set a trailing stop beneath the prior day’s lows (giving a little bit of leeway), and just keep holding until this stops working.
