Jay asked if I would take a look at the Keryx Biopharmaceuticals (KERX) chart.
On the weekly timeframe the stock can been seen pulling back from its March high to a 38% retracement of its 2012 low and 2014 high. Last week’s opening and closing range was locked between the declining 10 week and the rising 40 week moving average. The RSI and MacD histogram are moving higher, but the stock is still technically in an intermediate term downtrend.
On the daily timeframe the 38% retracement retested the $12.00 area which has been support going back to November last year. The stock has managed to hold above its 200 day moving average and looks like it is trying to close a gap up near the $14.00 level. There is a 22% short interest in KERX, and the Bollinger bandwidth reading is at a level that, in the past, has preceded volatile moves.
The upper end of the gap and the 50 day moving average should act as short-term resistance, but if they are breached on a closing basis, the combination of bandwidth compression and short interest could initiate a covering rally.
This is not a recommendation to buy or sell a stock, and readers should do their own due diligence before taking a trading or investment position.
Even Superman thinks greed is good.
The number of stocks in the S&P 500 index above their 50 day moving average is approaching a rarified level. Currently, 88% of the index is above that average and since the 2009 low it has only exceeded 90% seven times. Extremely high readings are often considered an overbought indication, but that is not always reflected in the movement of the index.
Tesla (TSLA) ended this week pretty much where it began two weeks ago, magnetized to its 50 day moving average and the 38% retracement level of its November 2013 low and this year’s high. The price momentum indicators have flattened, but on balance volume is above its 21 day moving average. A move over $220.00 or below $200.00, probably sets the tone for the intermediate term.
Shares of Praxair (PX) have spent this year forming a large cup and handle pattern. Today the stock is following-up on yesterday’s break above rim line resistance. The daily MacD indicator is overlaid on a weekly MacD histogram and both are making bullish crossovers. This technical coordination on multiple timeframes is a strong positive. Volume needs to improve to confirm the breakout but money flow has been positive since the beginning of May.
The $VIX is trading down below 11.00 at this point in the session, at its low of the day. The lack of concern, certainly not fear, in this market is for lack of a better term, scary. If the index does close below 11.00, it has to be from a purely reversion perspective, a good short term risk/reward trade going into the weekend. That said, you still have to consider it a highly speculative play.
Facebook (FB) is facing strong short term resistance in the $63.50 to $64.00 area. It has acted as a channel top since April with base support at the $55.00 level. The stock has not performed well during the last two days of strength in the broader market, but ultimately even if it moves lower there are multiple layers of support in the form of the 50 and 200 day moving averages, and a long term uptrend line before the channel bottom.
The S&P 500 has been trading in a rising channel pattern since it broke out of a rising triangle formation in April 2013. It is nearing the channel top again as the RSI is entering an overbought condition, and while it seems ludicrous to mention that volume has declined dramatically this quarter, I just did. The point is, moderate your enthusiasm, trade with your head not your emotions, and keep a close eye on the charts.
The spot copper price is down about 1.5% this week and it has moving below a downtrend line since 2011. The Fibonacci retracement levels, measured off the 2009 low and the 2011 high, have supplied key support and resistance during the decline. Currently sitting on the 50 day moving average and a short-term uptrend line, the daily indicators are rolling over and the 50% retracement level may be retested in the intermediate term.
Copper is not reflecting the euphoria seen in the Europe and broader U.S. markets.
Take a look at the daily charts of the S&P 500 and the Europe iShare funds. Happy days are (apparently) here again!