Sunday, August 4, 2013

Financials Rally

It's the start of another week here and taking a fresh look at different sector. Last week only one name I looked out worked out. $LNKD in was a name that I was looking at to continue higher after it's breakout before it's earnings call. Remember, we were very cautious because it was an earnings week for the name but given the success of $FB and $LNKD, it worked out well.

I also was looking for $NFLX to sell off. That didn't happen last week but the chart is holding flat so I am rolling my thesis over till this week. You can review my thoughts last week on my previous post $NFLX Bear Case

But this week I am noticing a lot of financial names are bumping right up against new highs. So far this year, the market has just kept going up against all odds. We have seen slight pullbacks but nothing to scare bulls out to the sidelines. So if this all keeps up, the push of these names into new highs can be a launching pad. I am watching volume at these highs to see if there are buyers backing it up.

Bull flag with a breakout to hit the highs. It was turned away at the end of the week and volume is moving lower.  Watch for a breakout over 53.50 on volume.

Bull flag as you will see with all these financial names. Moving out of the flag back to the highs. Watch for volume over 168.25

56.95 is the target to break here on volume as well. You can see the pattern of flagging and breakouts.  I want to see volume over 17 million on the day.
Over 28 would be the entry point. Another flag that has broken out. Volume is weak here but if buyers come in and the market follows, higher prices can follow. 

What to look for is all these names to raise.  If they can't make these new highs, they will drop back into the flags and possible start breaking down. They have already retested the highs twice so another fail to take new highs will probably cause some weakness. 

Happy Trading.

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