Power Stock Setups
March 28, 2022
Below are various names that caught our eye during our research process that might be worth a closer look. It is certainly not an exhaustive list, but should give plenty of names to review and develop a plan around based on your trading style and strategies.
Cloudfare ended the week trying to negotiate the top of its recent basing action. Volume footprint on the daily shows the accumulation while it was setting up, a move over Thursday highs worth a look to retrace back toward the 50% level. Can work against the daily VPOC for now.
International Paper has been in a persistend downtrend since last summer. The daily chart is now trying to reverse that move and put in a fresh RSI bull range. The last attempt at the beginning of the year got rejected. We see price is also coming up to the VPOC on both daily and weekly charts so a move over could bring in more participation
Dycom is working on a breakout setup that has been working for a while. If we were to zoom out further on the weekly chart, it looks like an even larger cup and handle pattern in a fractal like fashion. If we stay on the current we can see price is butting up against the top of value as it consolidates the recent move there with a tight flag. A small RSI positive reversal appeared Thursday and caught our attention.
Apple has been on a tear off the failed breakdown and could use a day or few of rest. It might be hard for many to buy right here, but it is also hard to leave off the list in this environment. It is currently being seen as a market safe-haven in the Tech space and is not extended on a momentum basis as it just shifted to a fresh RSI bull range late week. If the large cap theme we mentioned in the Macro and Sector review, this should continue to do well.
Air Products took a dive since the begging of the year, but fell right into a RSI positve reversal on the weekly RSI range test. both working well at this point. The initial bounce off the lows has been strong, but is now to the underside of the last breakdown spot and the MA bands. RSI is right near a RSI bull range shift, but hasn’t secured it yet. If we can clear this level, even if after some flagging action, it could bode well for a trip to the gaps above. A solid company that got very oversold on the weekly.
Phillips 66 is a consumable Fuels name that hasn’t participated much yet, but is trying ot put in a reversal. A move out of value on the daily and it could play some catchup as the whole subsector has lagged other energy spaces, but are starting to come along as investors dig deeper in the sector. RSI leading price right now on the daily too. On the weekly, the RSI bull range looks fine as it has pivoted back over the 50 level on this move after a brief loss. The 88-94 zone on the weekly will be the bigger challenge, but opens up the 120 highs if cleared eventually.
MasTec is an industrial that hasn’t quite made the RSI bull range shift, but has worked its way back into value. The last breakdown has been erased and when we look at it on the weekly chart it definitely stands out as a failed move for now. Daily need to clear the value level and may need a few more days to flag, but that would help build a good spot to work against for now. a move close back below the value area on the daily chart would suggest it isn’t ready yet.
Omega Healthcare Investors is another health care REIT. This one is a $7b company with an 8.76% yield while you wait for the double bottom breakout. The daily moved strong to end the week and shift in to a new RSI bull range. The weekly RSI is trying to breakout ahead of price as well. The daily breakout level is marked, but getting paid to wait helps start building a bit early if you like the theme.
Sonoco Products paper and packaging company put in a great looking breakaway gap that got challenged the next day and then ended the week on the highs and above the 200 day moving average. During all this, the daily chart shifted to a new RSI bull range. The pause came at the polarity spot on the chart where the big volume node ends. a move over this level this week can help shift the weekly back to a RSI bull range. Nexxt up is the 66 level, then a test of the highs near 70.
The charts and tickers above are for educational purposes and are not recommendations to do anything. This is just to help show you what we see and then let you take it from there and do your own due diligence. Either build your own trade plan or get with your advisor or broker form one before considering any ideas above.