Monday, June 20, 2011

2 strong charts

Terrible market, best be in cash, but for the active long traders, here are a couple worth watching.

Both these tickers are at major resistance, so they will need to break through with volume, respect the breakout levels once they break through, and be prompt about it as, again, going long in this choppy market is not advisable. If the general market does turn up with conviction, and their industry or region is strong, these could be leaders:

NOC. Watch the ITA (aerospace index) chart which is in a nice looking consolidation. If the ITA breaks out, NOC should be responding, if not leading. This is a defense stock, so it will not apply to a SRI or 'green' portfolio:


EWM: This region has been strong, I am also watching IDX closely. You have to be able to tolerate gaps and news driven events that are disconnected from the US, so plan accordingly. If you plot the EWM over the SPX, you will notice that EWM is sympathetic, so make sure the market is working or at least neutral and EWM may continue to outperform. You can also watch the movement of the EEM for support, like you would do the ITA for NOC, iykwim ;) I've taken a preemptive position in this one (higher risk than waiting for price and volume confirmation) but keeping it smaller, probably look to sell if it dips back under 14.75, can always get back in on the break.

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