HAS, ATI, TWX, SPLS, ADBE - 5 Bullish Stocks Looking to Move Higher

With the market looking to move higher, I decided to go through my watch list of nearly 200 stocks to find the stocks with the most potential to continue higher. Not only did I look for stocks with the most up side but also for the ones that had the least potential down side (meaning having the least chances of getting whipsawed with a -8.00% stop loss). After finding 20 interesting stocks, I finally broke down the list to a top 5. When selecting these stocks I took into consideration both the daily and weekly chart. I decided to ignore a few stocks that despite being in strong major up trends, are very low beta stocks which wouldn't provide a potentially strong return in the long term. In other cases, some stock's daily chart indicated strong up trends, while the weekly chart either showed a major down or sideways trend. I also decided to indicate the risk factor I considered each stock to be. This is based on if you were to take a long position at the current price. Each stock's risk factor is indicated as LOW, MEDIUM, or HIGH.

1 - HAS - BUY (RISK - LOW)

Looking first at HAS' daily chart there appears to be a potential flag pattern which would be confirmed with a break above $36.00. If the break out happens we would then have a price target up to around $40.00-$42.00. What adds strength to the potential flag confirmation is the common pattern of seeing the volume trend down during the flag formation. I consider HAS a low risk position at this point based on an -8.00% stop loss which would only get triggered below the current strong support levels at $35.00 and $33.50. Although the stochastic is in overbought territory it has given us a BUY SIGNAL.

Looking at the weekly chart, HAS is in a clear major up trend with the trend recently accelerated since the jump around $35.00. What was just 2-3 weeks ago the resistance level of the up trending channel, is now the new support level. The bollinger bands are also trending strongly higher, however it is possible for HAS to trade sideways for a little while before it can make another significant move up. Using Fibonacci Retracements, we can see now strong support around $33.00 with the potential of seeing HAS move back up towards $40.00 where its strongest resistance level stands.


2 - ATI - BUY SIGNAL (RISK - LOW)

After trading sideways for the past 4 weeks, ATI finally looks like it may start going back up. ATI started to break above the $46.00 resistance level, however it would be preferable to seeing it go towards $47.00 before jumping in. ATI has also broken back up its 50 day MA and has since continued to trend higher. ATI has good support at around $43.50 (50 day MA) and at $46.00 if it manages to remain above it this upcoming week. Last Friday's move up will influence the upper band of the Bollinger Band up which adds to the possibility of seeing ATI continue higher. The MACD has also given a BUY SIGNAL, however based on where the stochastic currently stands we may see just a minor move up before another pull back. Basically a move higher may happen more slowly than in the last minor up trend. This stock is considered LOW risk based on the fact that a move down of -8.00% would get triggered below the 50 day MA which would be enough to get a SELL SIGNAL.

Looking at the weekly chart ADBE does look like it may move higher towards $50.00 to $55.00. However, the major up trend is a broadening trend which most of the time breaks down. Based on the current price ADBE still looks like it has some good up side left in it. The ultimate test for the major trend would occur if ADBE reaches its 200 day MA. If it were to break above it, we would have a STRONG BUY SIGNAL, but a pull back from there could indicated the start of a major down trend. Despite all that, in the shorter term ADBE still looks interesting and definitely if it has the potential to get near its 200 day MA, meaning that it still has some good up side potentially left in it. The stochastic has also given us a BUY SIGNAL.


3 - TWX - HOLD (RISK - MEDIUM)

After trending strongly lower for nearly 4 months, TWX has finally broken its down trend after breaking above $28.50. TWX has since moved above its 50 day MA, whith the Bollinger Bands also starting to trend up. However, due to the pace at which TWX has been moving up and the fact that the stochastic now indicates TWX to be very overbought most likely means that the trend will be settling down sooner rather than later. A likely and preferable scenario is seeing TWX trending sideways while remaining above its 50 day MA before continuing higher. There is still some chance though that TWX may move even higher before that happens. The fact is that TWX is a HOLD as long as it remains above its 50 day MA. TWX is obviously very near its 50 day MA and an -8.00% move would be more than enough to confirm a failure of this recent BUY SIGNAL if it were to immediately move back down.


Looking at the weekly chart, we can see yet again that TWX has broken its major down trend. The next obstacle is going above the $30.00 resistance level. The next price target would then be towards $32.00 and $35.00, which if TWX manages to break would trigger a STRONG BUY SIGNAL. Due to the fact that TWX has broken back up its 50 day MA just recently and has relatively close resistance level to go through, TWX is considered a MEDIUM risk position at this point. The only reason I'm not considering TWX a HIGH risk is because it currently stands close to critical support levels which if broken, you shouldn't have to wait to incur a loss as high as -8.00% before concluding that the signal failed and that TWX may move back lower. I also consider TWX a MEDIUM risk due to the fact that the weekly stochastic has given us a BUY SIGNAL and started to trend higher while still being around oversold territory.


4 - SPLS - HOLD (RISK - HIGH)

SPLS has been moving strongly back higher in the past 2 weeks and now stands at a critical resistance level around $26.00. SPLS would give us a BUY SIGNAL if it can manage to break above $26.00. Due to the strong resistance and the fact that SPLS' stochastic is in very overbought territory, this stock is considered HIGH risk. It would be safer to WAIT and see if this resistance level is broken and maintained before getting in.


The weekly chart does show SPLS in a major up trend, but just like in the daily chart it has strong resistance to break through at $26.00. However, the stochastic has just given us a BUY SIGNAL while the MACD looks close to be giving us one.


5 - ADBE - WAIT (RISK - HIGH)

After trading down, then sideways, ADBE is now moving higher. ADBE has broken though the $33.50 resistance level while the lower Bollonger Band has started to trend higher along with the stochastic and the MACD which recently gave a BUY SIGNAL. However, the next major obstacle for ADBE is at its 50 day MA around $35.00, and until this level is broken ADBE is considered a HIGH risk position. There is relatively good chances of seeing ADBE move back to its 50 day MA, but whether it break up above it or not is impossible to say. However a move above the 50 day MA should send ADBE towards $38.00. If you are willing to take a HIGH risk risk, you could take a position at the current level and if it were to move to the 50 day MA and fall back down you could simply sell then. However, this doesn't mean ADBE can't just move back down from here. A sharp move back below $33.50 could send ADBE back toward $31.00, back in its sideways trend, or simply continue even lower.


Looking at the weekly chart, the obstacle to get back in the major uptrend is breaking back up above the 200 day MA around $35.00. However, although this is the safest play, last weeks candlestick does indicate a strong reversal, while the stochastic has given us a BUY SIGNAL while standing in very oversold territory.

Dow Jones - Heading Back Up?

Dow Jones - BUY SIGNAL

For the past few trading sessions, the Dow Jones has started to move back up: first of all we had a bullish hammer reversal pattern when the Dow Jones moved as low as around 9800 to only regain most of the losses and close just above 10000. The Dow Jones has since started to move higher by hitting higher lows and higher highs. Finally, on Thursday the Dow Jones broke through its minor down trend and is now trending in a minor upward channel. Today the daily MACD indicator gave us a BUY SIGNAL. Currently the Dow Jones stands at a critical level where it has strong resistance to go through at 10300 and at its 50 day MA just above around 10350. The ultimate test will be to see if the Dow Jones manages to break back up above its 50 day MA while maintaining its level above the 50 day MA. If that does happen we will have another BUY SIGNAL. In the short run if that BUY SIGNAL does occur, we could expect to see the Dow Jones move towards it upper Bollinger Band around 10500. Only if the Dow Jones manages to hit a new 52 week high above 10700 while maintaining the gains for a day or two will I issue a STRONG BUY SIGNAL. Right now, one strong possibility if the Dow Jones moves back up above its 50 day MA is seeing a major sideways trend. The reason for that is based on my observation for which the the upper Bollinger Band is now moving down while the lower Bollinger Band is moving up, which may indicate that the next short term trend may be sideways. Right now I would strongly consider starting to cover short positions, especially if the Dow Jones moves back up above its 50 day MA. Many stocks have started to break through their down trend today and gave us BUY SIGNALS. If the Dow Jones moves towards its 50 day MA and fails to move up above it sharply, we will have a SELL SIGNAL as this will add strength to the current major down trend. Looking at the weekly chart, the Dow Jones' MACD has yet to give us a BUY SIGNAL while the stochastic could give us one by the end of this week if the Dow Jones continues higher.

RIMM - At a Critical Level

RIMM - HOLD (Imminent STRONG BUY SIGNAL)

RIMM is currently in a minor up trending channel and stands at a critical resistance level. RIMM is currently around the level it broke down to after it had reported disappointing quarter results in October. RIMM is at a "make or break" level for which if it manages to move sharply over $72.50 we will have a STRONG BUY SIGNAL, but if it falls back down from here we may see it continue to trend within its major sideways trend between $55.00 and $72.50 (most likely $60 to $72.50 in the shorter term). Right now RIMM is a HOLD as long as it manages to continue trading within this minor up trending channel. One positive note is that the upper band of the Bollinger Bands has started to trend up which strengthens the possibility of seeing RIMM break this major sideways trend sooner rather than later. Keep in mind that if RIMM does manage to move sharply above $72.50, we want to see it maintain this level for about a day or two before considering taking a long position.

CGX - Still in a Major Up Trend Despite Turbulence

CGX - HOLD

CGX is one stock with a very particular chart right now. Since the month of November, CGX have been trading in a clean and clear up trending channel staying both above its 20 day MA (indicated by the Bollinger Bands - middle green line) and 50 day MA. In mid-January, CGX finally broke its channel's support line and traded below its 20 day MA. CGX came close to breaking its 50 day MA, but managed to strongly bounce back up to maintains its major up trend. However, what was once its support level is now resistance, which is is indicated by the middle sharp blue channel line. Despite the recent strong bounce up, there is now a warning sign as we can now observe a rising wedge pattern. There are currently two possible scenarios: 1) CGX jumps higher to break above the up trending resistance line to re-enter its up trending channel line, giving us a BUY SIGNAL. 2) CGX breaks sharply below the lower up trending blue support line, sending CGX at least towards $36.50 and $35.00. If the 2nd scenario occurs we will have a SELL SIGNAL out looking a minor down trend. However, the major up trend will remain intact as long as CGX remains above its 50 day MA. For, now CGX is a HOLD.

AGU - Stock Moving Up Despite Negative Market Momentum

AGU - BUY SIGNAL

I haven't been writing too many analysis lately, simply because the market in general is still trending in a major down trend. With that being said I feel very reluctant to giving BUY SIGNALS as most stocks are showing signs of weakness, trending down and giving SELL SIGNALS. However, I did decide to start looking for stocks today who are moving up or holding on to their current levels despite the market's weakness. One stock which has given us a BUY SIGNAL today is AGU, which crossed up over its 50 day MA today. The MACD, which I usually consider a very reliable indicator has also given us a BUY SIGNAL today. AGU is now actually trending up, while most other stocks in the market are either trading sideways or in a down trend. I still would be very careful before taking any long positions as the market is still trending down. However, if the market does continue lower, one stock you may expect to hold up or not lose too much ground is AGU. Remember that when a stock breaks over one of its moving averages, it is preferable to wait a day or two to see if the stock manages to hold up above it and not reverse back down. AGU's next resistance levels are around $64.30, $68.00, and $70.00.

Dow Jones - In a Major Down Trending Channel

DOW JONES - STRONG SELL

The Dow Jones has fallen once again sharply today, and erased all the week's gains. Like I had mentioned in my previous posts the momentum has shifted from positive to negative since breaking down below the 50 day MA around 10400. Despite seeing two consecutive days of big moves up, it only took one day to erase all the week's gains. The Dow Jones is now clearly trending in major down trending channel. Today, the Dow Jones even fell below the psychological 10000 support level. On a technical point of view there is not much support at 10000, and the closest support level right now is between 9800 and 9900. However, like I mentioned in my earlier posts I think the Dow Jones will head back at a minimum towards its 200 day MA around 9400. Other critical support levels are around 9100, 8600, 8100, and 6400. Before we can hope for any BUY SIGNAL the Dow Jones will have to break back up over its 50 day MA. For now we can expect to see the Dow Jones trend below its 50 day MA as it moves down. Basically we could see a similar pattern to the major up trend we had in 2009, only going in the opposite direction. Again opportunities are now more on the short side. You may see bounces back up here and there, but do not get fooled by these moves as long as the major down trend is intact; you never want to trade against the major trend. It is fair to expect to now see a more volatile market, similar to what we have seen in 2008. As long as the down trend persists, I believe up bounces will just be opportunities to short the market. For those who fear taking short positions and prefer to take long positions, you should look for stocks who are negatively correlated to the market. You have to be very careful when picking your stocks if you intend to take long positions, which I would advise against to. The best option for those who prefer not taking short positions is to simply stay on the sidelines, and cash in whatever long positions you still have, as they are most likely to go down along with the market in general. During uncertain times, it's always best to take a pause and wait for the market to stabilize.

Dow Jones - Testing 50 day MA resistance soon?

Dow Jones - WAIT

After falling as low as 10043 last Friday, the Dow Jones now looks like it could be very soon testing its 50 day MA resistance level, which currently stands at 10431. The 50 day MA has started to shift downwards, but with a BUY SIGNAL given by the stochastic on Monday, and seeing it followed by another sharp move up on Tuesday, I think it will attempt to move back up over its 50 day MA. This was to be expected to happen sooner or later, as it is very common to see an attempt at recovering losses after seeing a critical support level broken, which is now resistance. If the Dow Jones were to manage to move sharply over its 50 day MA, we would have a minor BUY SIGNAL. At that time, the next resistance level we would be targeting for would be around the 52 week high of 10729. A sharp move above 10729 would then trigger a STRONG BUY SIGNAL, and would most likely mean that the major up trend will resume. However, if the market falls back again from the top, this could indicate the possibility of seeing a double top pattern which would reaffirm the end of the past major up trend. Although the market has been moving back up sharply this week, keep in mind that it fell much harder during the past 2 weeks. The negative momentum we saw in the past 2 weeks was much stronger than the positive momentum we are experiencing so far this week. It is normal to see a a few bounces back up after such a move down. Keep in mind that the the Dow Jones is still off by 458 points (4.46%) from its high of 10729. Also, if we look at the weekly chart, the STRONG SELL SIGNAL given by the MACD is still valid. With that being said, I would be very cautious right now, and for those with no current positions in the market, I would WAIT on the sidelines. The next few weeks will be very determinant in terms of the market's direction for the rest of the year. In the very short term we could see more up side, but in the long term the market really has to prove itself and manage to move back up and hit a new 52 week high. The past 2 week's losses did do a lot of damage, and the market will have be driven by very strong positive news to resume the major up trend. There is always the strong possibility of seeing a sideways trend, but it is too early to say. A sideways trend would make trading a lot harder. In a sideways trend you would have to be able to be very good at timing your entries and exits while cashing in smaller gains than usual, as you would then risk of losing it all.