Trader and blogger Brian Lund of BCLund.com shares the charts of some stocks that he sees exhibiting relative strength lately.
The markets got a nice bounce last week, however due to the short holiday week and volume being less than desirable, that bounce is guilty until proven innocent.
The name of the game since this market decline started has been “relative strength,” and there are a number of charts that are showing that in spades, but first let’s take a look at some sector action.
Two weeks ago I wrote, “After being in a down channel for six months, SKF put in a double bottom and broke out of that channel. If it breaks resistance at around $39.50, that would not be a good thing.” Fortunately it failed that breakout (see arrow on above chart).
The biotechs were hot, hot, hot this year but got taken down when the market decline started. The $IBB, however, did a “double tap” at the 200ma and bounced nicely. Need to see some consolidation first, but that could set up another run in this sector.
Another hot sector this year as been the homebuilders. XHB found support last week and looks like it is poised to go higher.
About two months ago, I noted that the FXI seemed to have found a bottom. After a nice breakout it pulled back to support and the 200ma and bounced well, which is good price action.
So let’s take a look at some individual stocks.
After a small head fake, BAC has resumed its upward movement and looks like a buy above $10.00 if it can break out with volume.
I don’t know anything about CEL, but it’s been basing right below gap resistance and has broken its 200ma for the first time in about two years.
NEXT PAGE: More Charts of Stocks Showing Relative Strength