The market was volatile leading up to the shortened holiday trading week as technician Corey Rosenbloom of AfraidToTrade.com takes a technical look at five stocks that reached their 52-week highs.
A quick mid-day scan Tuesday found 116 NYSE stocks achieving fresh new 52-week highs—here is a sample of five of these leading stocks and a quick glance at their daily chart with an emphasis on the uptrend and breakout that brought these stocks to the forefront of the scan.
We’ll also note similarities in these five names and note price levels to watch depending on whether the breakout continues or a retracement opportunity develops.
TD Ameritrade (AMTD) Daily Chart:
For TD Ameritrade shares, the stock has been strongly uptrending since the $14.50 low (corresponding with the SP500 swing low) in November 2012 toward Tuesday’s 52-week breakout high above $24.50 per share.
As we’ll see in most of these five names, daily chart reversal candles and an ongoing negative momentum divergence suggests caution and the preference for waiting to trade a retracement as opposed to jumping in on the (weak) breakout to new highs at least in TD Ameritrade shares.
Simple focal points to watch as reference levels will be the $24.00 per share level and the rising 20-day EMA into $23.84 (intersecting $24.00).
Look for a similar “bounce” off the rising 20d EMA as was the case June 24 or else look for a breakdown and close under the rising daily average to set up a bearish play toward the rising 50d EMA and lower Bollinger Band intersecting $23.00 per share.
Amazon.com (AMZN) Daily Chart:
Our last update with Amazon discussed the inflection point in May and the possibility for a breakout (which occurred) or else a continuation swing within the boundaries of the falling trendlines as drawn.
The strong two-day breakout sets the stage for a retest of the 2013 highs and two “retracements” or flags back to the falling trendline support level and particularly the rising 20-day EMA set-up low-risk bullish support/retracement trades.
Tuesday’s continuation of the rally from the $270 reversal candle and confluence support low resulted in a breakout to new highs and an update of the key levels to watch for traders/investors.
The $283 per share horizontal support level serves as a critical support inflection level that will determine whether to take stop-losses or play bearishly short-term (on a breakdown) or else continue trading for higher prices or retracements that develop above $285 on a pathway toward the next “round number” target into $300 per share.
Ford Motor Company (F) Daily Chart:
While the share price remains ‘low’ relative to other leading stocks, investors have enjoyed a larger than average percentage return from the recent movement from $10 to the current 52-week high Tuesday above $16.00 per share and the previous May high.
I drew two larger “bull flags” or retracement patterns to highlight the lower-risk opportunities to play (position or trade) a stock in a pro-trending rally phase, although trading a pure breakout recently above the $14.25 high from January did result in a stellar swing trading profit.
Continue monitoring the breakout above the $16.00 per share level with respect to a strong rally that brought us to this point and the “open air” under $16 to the next lower confluence support level into $15.50 (trendline and rising 20d EMA).
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