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SignalWatch – 4.17.17
April 17th
Good afternoon folks! The indexes got off to a strong start this week, with all three closing higher after several tense situations around the globe cooled off. Hopefully, the geopolitical situations will continue to improve for multiple reasons but for now, the bulls are most definitely breathing easier. Since the market is back in a bullish mode, we are going to be focusing on several new buy signals this evening. So let’s get to it!
A new Darvas signal has fired on Merck.
Darvas Classic Strategy
Tonight we have another solid Darvas signal. I know, Darvas Box, again… But hey, what can we say, the signals are just really good! As you can see, I also added the Darvas Classic Indicator to the chart, so everyone can see exactly what they look like. The current box formed once the low surpassed the previous box’s low and once we have a move up off of the boxes low, a signal is fired. Nifty. There are a few other Darvas indicators and I will throw those on the chart in another post. And again, we will be featuring a post on the Darvas Method in the coming days.
MRK is also testing support and is oversold on both the Bollinger Band and RSI indicators. Volume is light, but if we see a pop, a solid reversion move could be underway. If we witness the upside move, it could head back into the $64 zone where its 50 SMA currently resides.
Next up, Goldman Sachs.
A mew GT Momentum signal has fired on GS.
GS had a huge day and scored a hefty 3.34% gain on the day. This move comes after moving through support last week and becoming extremely oversold. GS has also formed a Double Bottom pattern which occurs when the same support level is tested twice in a relatively short amount of time. This support level was tested back in late March and we saw a nice little reversal move immediately following the support test. If things play out this time like they did last month, a return to $230 is not out of reach.
Not only did GS have a good day, all of the financial sectors had a decent day which is why GroupTrader is responsible for this signal. GroupTrader focuses on searching the market for stocks that are in a tight industry group rotation (stocks that are tightly correlated and in the same industry) and finds the industries that are outpacing the market and then it narrows it down to the best opportunities in the rotation. It’s a popular method and one that VisualTrader was made to capitalize on. For more info on GT Momentum, check out its PDF.
Last but certainly not least, General Motors.
A brand-new ACT signal has opened on GM.
GM has been heading lower after breaking through the support level of a trading range it had been in since December broke down. It is now testing its new support level right at $34 which is also a confluence level with the 200 SMA. GM showed resilience today after testing support, pushing higher for a gain of 1.71% on the day. It is oversold on three indicators, the standard RSI, the Bollinger Bands and the special ACT RSI, designed for the ACT plug-in.
ACT scans the market for stocks that are about to begin their next buying cycles (or selling cycles for you bears). GM fits the bill according to ACT 2.0’s systems and filters. If this signal is correct, we could see GM pop back into the mid $30’s before reporting earnings next week.
That’s it for tonight. Stay tuned for some special goodies coming up this week! Have a wonderful night!
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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.