Some solid and some not-so-solid stocks made the screens tonight (technically speaking) but the main theme of Tuesday seemed to be the resistance near new high territory. My two examples, (CSIQ) and (PPO), were both higher on strong volume but they couldn’t close in new high territory or the top end of their daily ranges.
This information tells me that the market is currently facing some resistance or profit taking near new high levels. However, these same stocks facing some resistance now may be ready to take-off once the weak holders are shaken out of their positions. Ideally, that is exactly the type of trade I am looking to enter as I love stocks making new highs with no resistance in sight.
Stocks making multiple screens tonight:
AIMC, BLT, CF, CRK, CSIQ, FSIN, HK, HP, LL, MCF, NOA, OMGI, PPO, PQ, RSG, TITN, TRA, VAR, XCO and XIDE
CSIQ and PPO made four screens and TITN made three.
Canadian Solar (CSIQ), 47.00, was up 10.69% today for a two day total of 20.51% on above average volume. Volume was 171% larger than the average on Tuesday and is already above average for the week. The stock is now within 3% of a new all-time high. I do have a major problem with the intraday action which had the stock close in the lower end of the daily range (lower half of the daily candlestick). This type of action suggests some selling pressure near $48 or the buyers from last month looking to break even. A move to new highs later this week is bullish.
Polypore International (PPO), 25.38, reached a new all-time high intraday with a 4.49% on volume 187% larger than the 50-day average. As the case with CSIQ, the stock didn’t close at the top of its range which concerns me slightly. Overall, the young stock looks solid as it is trending higher with a new double top breakout on the point and figure chart. Relative strength is rising as the company lives in an interesting industry group.
Chris,
In case of CSIQ, does the fact that its a little extended from its 40 week MA concern you?
Thanks.
Dima,
Yes, that is a concern in addition to the selling pressure near new highs. I love new highs but I also love plays close to the 200-d m.a. so I have a slight conflict. Two different approaches to opportunities.
Hello boys!
According to IBD’s Learning Center, stocks that make new highs continue to go much higher, why lows fall. So much for “buy low sell high”.
Study up on Price Headley’s Acceleration Bands indicator to only enter on new high for accelerated profits, I have.
Eva
P.S. Bought CSIQ NOV22.5 CALLS FOR 4.70 on 3/7, today they are at 23.60 despite some retracement. Eva
hey chris,
does the ma chart seem to be forming a mini head and shoulders pattern? it looks to me as if it could fall down through the 200ma to the 250’s or so. If it does, im gonna load up on some of that. whats your take?
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