They may not be quite ready yet, but there is a growing sense that the markets are coiling on a spring and will be on the move soon … I would say by the end of the year we should have a clear signal.
- The OVI for the Nasdaq (QQQ) has been quietly positive for almost three weeks, and there is resistance at 66.37.
- The OVI for the S&P (SPY) is modestly leaning that way with a reverse head and shoulders potentially forming as well.
- The OVI for the Dow (DIA) has been quietly positive also for the last few weeks.
Stocks to talk about:
- AAPL – At some point the misery has to stop, but it’s not ready yet – at least not in our language, but keep watching. For now it’s still bearish.
- AMZN – can’t yet make up its mind and has made a false breakout in the last week. That said, it didn’t collapse, it’s just drifting sideways, pending potentially a new breakout. OVI has been positive for a month.
- BAC – forming a bull flag – already broke nicely through 10.00. OVI has been positive for months, since which time the stock is up over 40%.
- BIDU – not so encouraging, despite the last few days’ bounce since its doji on 6th December.
- C – similar to BAC with a bull flag forming and a modestly positive OVI. I’ve been bullish on the financials for several months – just look at the chart since August (including the OVI) and you’ll see why.
- F – positive OVI for many months with a price rise too, but choppy with big retracements making it difficult to trade.
- FB – we’re going to start including this in the OVI Express40 stocks in the OVI Traders Club charts. Why? Because it forms tradeable patterns. But beware around earnings as this will be a regular gapper.
- GOOG – was beginning to look interesting as it looks like a breakout from a mini reverse head and shoulders with a positive OVI for the last 3 weeks. I’d like to see another consolidation here.
- GS – is it a head and shoulders or are we bracing for an upside breakout. I was bullish on GS in August and September. A clean break through 121.50 with a corroborating OVI would get my attention again.
- JPM – another financial stock looking poised. Positive OVI for months, right at resistance, good positive volume action. Needs to break the October high and keep going.
- MCD – forming a bull flag and could fill the gap if it breaks past 90+.
- MS – like GS, is this a head and shoulders or is it about to break to the upside. Not as obvious looking as other financial stocks, but there is a sense of a coiled spring here, either way.
- RIMM – OVI positive since October … since which time the price is up 75%.
- WFR – this one’s a punt. A former glory stock that has hit hard times, but it’s forming a cup and handle above its 200 day moving average, and the OVI, while unspectacular doesn’t go negative. A break above the September high would be very interesting indeed as the company seems to be reinventing itself. It’s doubled since June.
All the best
Guy