If the price passes through the cloud and 45.00 resistance level, we’ll get confirmation of further upward movement. It will be a new buy signal with entry level at 45.10. Stop orders should be placed at 44.30 level and take-profit orders at 46.50 and 47.50 resistance levels. If the price bounces from the cloud and drops below the uptrend line, it will be better to delete the buy orders and wait for new trading opportunities. If you don’t use leverage, recommended trading volume for this trade is up to 5% from your deposit.
Profit Targets: 46.50 and 47.50
The trading signal is based on Kraken chart.
Trade Recommendation: Stellar
The price bounces from SMA50 which is a support line for the market. MACD lines support upward movement. Also we can draw a pennant chart pattern which also confirms further upward movement. If the price breaks the resistance line of the pennant, this pattern will be realized as a continuation pattern. It will give us an additional confirmation of the upward movement. Pending orders for buy should be placed at 0.035000 level with stop orders at 0.028000 level. The main profit target should be at 0.048000 level. The part of trade volume can be left for the higher target at 0.070000 level. If you don’t use leverage, recommended trading volume for this trade is up to 5% from your deposit.
Profit Targets: 0.048000
The trading signal is based on Poloniex chart.
Trade Recommendation: Lisk
A new attempt to catch a trend reversal. The price diverges with MACD and it gives us a buy signal on the falling market. DMI allows to open long trades. We should place pending orders for buy above the previous high at 0.000840 level. Stop orders must be placed below the support at 0.000680 level. Profit targets are 0.001200 and 0.001400 levels. The part of trade volume can be left for long run. If you don’t use leverage, recommended trading volume for this trade is up to 5% from your deposit.
Profit Targets: 0.001200 and 0.001400
The trading signal is based on Bittrex chart.
Buy FDS, PPC, BERY, and IIVI for the short-term
The US tax reforms received a major boost on Thursday when a measure approved by the Senate, enabled the Republicans to proceed with the tax cuts, without the support of the Democratic party. Suddenly, passage of the tax cuts looks more plausible.
- Positive news is flowing on the tax reforms front.
- Tax reforms are likely to boost the S&P’s earnings significantly
- The stocks are likely to remain buoyant in the final quarter of the year
- Buy FDS
- Buy PPC
- Buy BERY
- Buy IIVI
Goldman Sachs believes that if corporate tax rates are reduced from 35 percent to 20 percent, it will increase the annual per-share earnings of the S&P 500 by $15. Consequently, the stock market will look a lot less richly valued on a forward price to earnings basis.
With this bullish backdrop, the stock markets are likely to remain buoyant in the short-term. However, we don’t advise investing for the long-term at these levels. We believe that the markets will fall within the next few months, offering an opportunity to buy stocks at lower levels.
Therefore, we shall trade this market and attempt to ride the momentum. We have selected stocks that are making new 52-week highs because they have a favorable tailwind and are likely to participate in the rally, along with the S&P 500.
So, without further ado, let’s check out the stocks.
FDS – Buy 185.76, Stop Loss (SL) 174, Target 204 and 216
The stock’s history shows that it tends to rally for a few years and then enters into a shallow correction or consolidation. We find three such instances in the past decade. The stock has been in a consolidation since end-2015. Two attempts, one in September 2016 and the second in March 2017, failed to sustain the breakout.
However, the stock again broke out in end-September and extended the rally last week. It is likely to start a new uptrend now and we plan to hop along for a ride.
The stock broke out of the bullish ascending triangle formation on September 26. Thereafter, it faced resistance at the $184 levels, from where the bears attempted to sink the stock, back into the triangle.
However, the bulls provided support at the $176 levels and the stock broke out of the overhead resistance on Friday. It is now likely to rally towards its first target objective of $204. The pattern target on a breakout from the ascending triangle, however, is higher at $216.
Therefore, we recommend a buy on the stock at the current levels with a stop loss of $174. We don’t want to hang on to the stock if it falls back into the triangle once again. The stock has a risk to reward ratio of 1:1.5 at the first target objective and a ratio of about 1:2.5 at the second target objective.
PPC – Buy 31.04, SL 27, Target 37
The stock rose sharply from end-2012 to end-2014. Thereafter, it corrected and entered into three-year long consolidation, during which, it remained range bound between $17 on the lower end and $27.5 on the upper end. PPC formed a double bottom at $17.3 levels and the pattern completed when the stock broke out of $27.5 in mid-August of this year. Subsequently, the stock completed a successful retest of the breakout levels of $27.5 and rose to multi-year highs last week. We, now, expect the stock to start a new uptrend.
The stock broke out of the overhead resistance on August 15. However, the stock faced considerable resistance following the breakout. It remained sandwiched between $28 and $30 for almost two months. Finally, on October 18, the stock broke out of the range and extended its rally on October 20.
It has a pattern target of $37, which is close to the lifetime highs. There is no significant resistance in between, therefore, we recommend a buy on PPC at the current levels of $31.04. The stop loss can be kept at $27, a level not seen for more than two months. The trade offers us a risk to reward ratio of about 1:1.5.
BERY – Buy 59.88, SL 56, Target 67
BERY has been in a strong uptrend since 2016. It has a clear pattern. It rallies and then corrects towards the 20-week exponential moving average (EMA) and occasionally to the trendline drawn. On completion of the correction, it again resumes its uptrend.
Recently, the stock had again corrected to the trendline, from where it found support and broke out to new lifetime highs last week. We expect this trend to continue until the stock breaks and closes below the trendline support. We want to enter this stock as it has re-established its uptrend.
The stock broke out of the overhead resistance of $58.95 on October 06. Afterwards, it successfully retested the breakout levels and has resumed its uptrend. We can buy the stock at the current levels of $59.88 and keep a stop loss of $56. We shall close the position if the stock falls below the trendline. Our target objective is $67. The trade offers us a risk to reward ratio of about 1:2.
IIVI – Buy 43.3, SL 39, Target 52
The stock bottomed out in October-2014 around the $10.78 mark. Thereafter, it started a new uptrend that continued till February of this year, after which, the stock entered a period of correction. $41.1 has acted as a stiff resistance on the way up. However, last week, the stock broke out to new highs and we expect it to continue higher.
On the daily chart, we find that the stock has formed a bullish inverse head and shoulders pattern. The pattern completed with a breakout of the neckline on September 27. Thereafter, the stock successfully completed a retest of the neckline. The stock has a pattern target of $52. We want to enter the stock at the current levels and keep a stop loss of $39, which is just below the low created on October 19. This gives us a risk to reward ratio of greater than 1:2.
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- Buy FDS, PPC, BERY, and IIVI for the short-term October 22, 2017
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