SignalWatch Picks of the Day – 3.24.17

The market closed out the week with another interesting day as the Dow and S&P closed down for the day while the Nasdaq closed slightly up. The catalyst for all of the intraday movement was the inability of the GOP to garner enough votes to pass the repeal of Obamacare. The far right held out and denied Republicans and President Trump a major campaign promise. Trump issued an ultimatum this morning stating that if the bill could not be passed, he would forgo any other attempts to repeal the ACA.

Investors and traders were tuned in because it is being looked at as a bellwether for how Trump will be able to push his agenda through Congress. With the inability to repeal Obamacare with the GOP controlling the House and the Senate, it looks like it could be an uphill battle to pass other initiatives. Time will tell if that proves to be the case or not, but that is the major reason for why the markets were reacting wildly.

This marks the first week since before the election where the markets were rocked. Investors also began pulling out cash from the market this week, which could cause further decline next week. But once again, we’ll wait and see.

To wrap up the week, we are going to look at three new buy signals fired this afternoon. Let’s get to it.

MVX-15

MVX-15 is looking for BK to make a reversion move back into its bullish trend.

Our first signal comes to us courtesy of the MVX-15 strategy and was fired on Bank of New York Melon (BK). The strategy looks for large pullbacks with long trends that are starting to show a reversion move back into the prevailing trend. It also looks to avoid any areas of known volatility like earnings reports. And that is what we are seeing here on BK. It has been trending higher since October but it has now had two significant pullbacks. The pullback in January resulted in a beautiful reversion move, similar to the type of move we are now prospecting for.

BK has tested the 50 Simple Moving Average, which also coincides with the pivot point for the trend at $46.25. It is also using this price as a bit of support. If things don’t go totally wonky next week and BK stays true to form, we could see BK back in the $49 zone heading into April. To learn more about the MVX-15 strategy and what makes it tick, check it out here.

Next up, a trendline breakout on Starbucks.

CPS5 Trendline Break

CPRM6 is looking for Starbucks to make a break for it after moving through an established trend.

Starbucks has been winding higher in spite of the rest of the market’s worries and trepidations this week. Today it posted a healthy gain of 1.72% and cruised right on through both the 50 SMA and a bearish trendline that dates back to late January. It was today’s push that caused our CPS5 Trendline Break strategy to fire off a new buy signal. This strategy is part of the Chart Pattern Recognition Module 6 or CPRM6 for short. A trendline is a line drawn across two or more sloped points in the chart, in this case, three points.  Usually, the more touches a trendline has, the more valid it tends to be.  There are two essential patterns for trendlines; breaks, and reversals.

A trendline break occurs when, you guessed it, a security breaks throughs the trend. Fashion that. As we can see SBUX fits the bill quite well. The next area of resistance resides at $57.60, which should be used as the initial price target if this breakout move continues. From there, look for new higher lows for additional entries. For more information on CPRM6, check out its literature here.

To round out the week we are jumping back on to the MVX-15 train with Oracle.

MVX-15

MVX-15 strikes again with another signal this afternoon, this time on Oracle.

Like on BK before it, MVX-15 has spotted a new large pullback in an even larger bullish trend which could lead to a fantastic reversion move. ORCL is now at support at $44.65, which is also just above monthly VWAP which is forming a nice level of confluence. ORCL is trading well above both the 50 and 200 period moving averages.  If ORCL levels off here at support and then pivots back to the upside, we are looking at a new higher low and the beginning of a climb into the high $40’s and perhaps even a new high at $50.

If you like to know more about our plug-ins like CPRM6 check out our solutions page and for more information on MVX-15 and other Advanced Strategies, click here.

That’s a wrap for the week. We will see you right back here on Monday to punch the market right in the face. Have a safe and wonderful weekend!

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable.