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3 Big Names Look Set To Move Higher

After the big run last year, the market has sorted itself out and now we have some stocks rolling over when others are turning up. Stocks that rolled over last fall seem prepped to start their next leg higher. These three stocks look like they are under way.

The first is Salesforce.com which topped out in early September with most of the large-cap tech. After a 7-month retreat, the PPO momentum indicator looks like it is resetting near zero and I would be looking for it to start turning higher. The stock is moving back above the 10-week moving average this week as well as 6-week highs.

The next stock I like is Visa with the chart about to break out to new highs. Visa ran up to the September high, but continues to struggle trying to break above that level ($215). If the stock can jump a little, it would be good to break the downtrend in momentum on the PPO as well as the relative strength shown in purple.

L3Harris Technologies is pushing to new 52-week highs. The chart has a few attributes I like. The PPO indicator displaying momentum is pushing up to new highs. The relative strength downtrend has broken and has started to make 3-month highs.

Its a changing world out there and a wide variety of names are rotating into strength. Be on the alert for some of the great companies starting to make their runs.

If you get the chance, you might enjoy this weeks Market Buzz where I discussed Gold. I know, it is out of favor. But that is the best time to look at commodities.

Something Old Starts To Shine

I’ll be hosting Friday’s Final Bar (April 9) which can be viewed on StockCharts TV and the Youtube Channel after the market close.

You might enjoy Friday’s Your Daily Five on StockCharts Youtube channel as well! It will be on posted Friday morning!

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These Stocks Look Like They Have Renewed Energy

The Alternative energy space has been very volatile. Surging up a couple hundred percent then back fifty percent. It all adds up to capturing profits and trying to buy back in near the lows.

A few names that have been roiled recently that are starting to look like setups again are the wind and solar companies. Either suppliers into the utilities or the actual utilities.

One example I like is Brookfield Renewable Partners. This chart has two important things to be aware of, but if it can complete the turn, it should have nice ‘power’ to the upside.

  • The first is the SCTR is at the lowest level on the chart. That doesn’t mean it can’t bounce back up, but many times when stocks start to underperform, institutions might just sell into the rally.
  • The sudden drop in momentum shown by the PPO is concerning. As the PPO indicator tries to turn back up, we want to be very aware of the potential for it to lose momentum again and make another quick move down.

We saw the sudden move down in 2020, but a whack of stimulus around the world unleashed a big rally. I prefer gradual pullbacks, not sudden drops on my PPO. I still like the setup as the full sto turns up.

Innergex is a Canadian listed stock with a similarly nice setup. We have a buy signal on the full stochastic. The same concerns exist with the fast drop and the weak SCTR, but we won’t know the outcome until long after the trade plays out. I still like it here.

Another listing is Boralex. We can see the same dynamic setting up in all of these charts.

I like it when the whole group starts to turn higher. At least there is some support from investors across the range of names.

Good trading,

Greg Schnell, CMT, MFTA

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Defensive Area Buys | Greg Schnell, CMT | Your Daily Five (03.30.21)

Greg brings the 5 charts he is following this week. At the moment, he is looking to buy in defensive areas of the markets. These areas include Healthcare, Consumer Staples, and Utilities which are starting to take over leadership.

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Stuck In A Canal

This week saw a 400′ meter ship stopped by 5 meters of soil. A bunch of ships are now backlogged. 12% of the world freight goes through the canal. It is the location of that ship and the soil that makes the situation so important.

Somehow to me, I see some of the same traits in the market right now.

The entire momentum trade is sitting right at the base of support, and if they all get unstuck here and move higher, we can breath a sigh of relief. If they all start to drop below support this could create a real surge lower. It is a big backlog if they all start to fail. The floodgates could open here.

Shopify (SHOP)

Shopify is threatening to break down through the support dike at $1065. It is also the 200 DMA level (green line). I don’t like the 4-month lows on the relative strength to the $SPX in purple.

Tesla (TSLA)

Tesla has been underperforming the $SPX since February. That was shortly after the January high. Now support at $600 continues to be tested. Over the next few weeks this needs to hold on one of the most watched stocks.

Ballard Power (BLDP)

Ballard has been one of the big alternative power stocks. The chart needs to hold support $22.

ServiceNow (NOW)

ServiceNow is already making 6 months lows in relative strength. There is a pretty big top here. It needs to hold there.

Peleton (PTON)

Peleton sits at $100 and the 200 DMA. Another one where the dike could break.

ROKU (ROKU)

ROKU is already down $150 off the highs. Sitting on support.

I could go on and on. We are at a very important level that needs to hold.

Already this week, we have over 1600 stocks down big on the week. We only have a little more than 100 stocks up using the same scan criteria this week. But the $SPX is only down 4 points on the week. Its a fragile market. Be prepared for both directions.

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