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- Signals of the Day – June 7
Signals of the Day – June 7
6.7.17
The indexes all closed up for the day while crude on the other hand dropped -5% after a sour inventories report. We are going to move with the broad market mode, and focus on three new buy signals this evening. But, keep an eye out for volatility tomorrow as former FBI head James Comey heads to the Hill to testify about the Russian probe and his conversations with the President. He’s already released his opening statement so tomorrow should be interesting.
On to the signals!
The UIS Hull Moving Average is looking for continued strength out of MNST.
MNST was relatively quiet today and continued to trade inside of the consolidation zone it has been in since late last month. This consolidation follows a huge move up last month though, so it likely represents exhaustion in new positions. We have not seen it move down though, which means that supply and demand are still balanced out for the most part. If we had seen a dramatic push down, that would have represented many closing their positions, but that is not the case. Which could leave one to believe that traders are going to give MNST another run. It is also consolidating just above its support level at $50.50. Volume is on the upswing and we can also see that CRSI is looking for a bump. It is also trading well above both the 50 and 200 period moving averages, giving us an overall bullish mode.
This signal was fired by the Ultimate Indicator Suite which is part of the OmniTrader 2017 upgrade. The Hull MA follows price extremely well and it makes longer term trends easy to identify. The UIS uses this ability along with a great Hull system. The Strategy uses the Double Stochastic for signal generation. The Hull Moving Average is used to ensure that the stock is trending higher. A Break even exit is used to lock in a small profits if the trade doesn’t take off for us. When it does move though, it employs a great trailing profit stop to maximize the trade. Pretty solid for something included in OT, which you can try for free HERE!
The ICM strategies are hot on TROW.
ICM Cloud Breakout
TROW is has been consolidating for a few sessions just below resistance at $72, but today we saw signs of life for a renewed bullish move as the 50 SMA moved through the 200 SMA to the upside. This is great confirmation that additional bullish movement is on the way. It is also on the midpoint on the CRSI, RSI and Bollinger Band indicators, giving it plenty of room to continue before becoming overbought. It has also recently pulled off a bullish trend line reversal, giving this signal additional confirmation.
This signal, like the one on MNST, can be found in OT using the Ichimoku Cloud Module. Ichimoku (Ichimoku Kinko Hyo) translates to “one glance equilibrium charts”. What that means is that a “cloud” is formed as a shaded area between support and resistance of the Ichimoku indicators. ICM makes it easy to see trend direction and strength, future support and resistance levels as well as price momentum.
The Ichimoku takes recent price data and plots two main indicators (Leading Span A and Leading Span B) to create a “cloud”. The cloud is then shifted to the right. If price is on either side of the cloud, we can determine what type of trend we are in. The thickness of the cloud tells us the trend’s strength. As price approaches the cloud, we will often see the cloud provide support or resistance. If ICM called this one on TROW, we could be looking at a near term move into the $74 zone. Stay tuned.
A new higher low has formed on WFM and MS-16 likes what it sees.
Whole Foods has enjoyed a strong move as of late after announcing several strategic business decisions to improve their bottom line. It has pulled back over the last month and now finds itself at support at $35. But… support also happens to be a confluence level with the 50 SMA and we are seeing volume start to increase ever so slightly. It is also very oversold which puts WFM in perfect reversion to mean territory. If WFM gets the boost it looks like it is going to, we could see this back in the high $30’s before long. Keep in mind reversion moves are not buy and hold situations, so be ready for this signal to close fairly quickly.
This signal was generated by our MS-16 advanced strategy. The strategy works by using two different momentum based systems and filters based on trend direction. MS-16 also uses an indicator called Days to Earnings. This indicator helps traders avoid trading into earnings reports, offering a extra layer of safety. MS-16 also uses a scan which pinpoints the stocks that are outperforming the current market that have also made a significant pullback against the trend. This leads us to great reversion opportunities like we see here in WFM.
That’s all for this evening. Have a wonderful night and take care.
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About the Author Ryan Belknap
Ryan has been with Nirvana since 2012 and has been manning the trading desk since Day 1. He was one of the founding members of Nirvana's Trading Lab and also TraderSource.com along with Ryan Olson and Russell Casperson. Ryan logged more than 3,500 hours trading and educating live in the Lab. He is also the lead author of SignalWatch.com. Ryan is a seasoned educator and has conducted numerous educational webinars and is an OmniTrader University instructor. Ryan prefers swing trading and position trading. Outside of the market, Ryan has passions for the outdoors, baseball, exercise, coffee, pop-culture and spending time with his family.