Divergence Watchlist 09/04/2017

S&P 500 Overview

S&P 500
The S&P 500 broke out of previous channel after gaining 1.19% for the week of 8/28/17.

The S&P 500 gained 29.2 (1.19%) points, opening at 2,447.40 and ending the week at 2,476.60.

There are some key levels to keep an eye on this week.  First, it is important to note the new channel that we are in.  There is room to gain, but the key technical level of 2484 cannot be ignored.  We are approaching a third attempt to break through 2484 and a rejection could lead to a significant reversal.

Semiconductor and Biotech Shine

SOXL Chart
Semiconductor ETF broke out of the symmetrical triangle pattern starting with a stochastic divergence on 8/14/17.

There were clear indicators that this would be a nice bullish week with some breakouts in the tech sector.  Semiconductors (SOXL) and Biotech (LABU) led the way to impressive gains. SOXL gained over 10% and LABU added over 20%.  This trend is likely to continue after some profit taking.

In the chart above you can see the stochastic divergence from 8/4 – 8/14 (marked by the green lines).  This signaled a trend reversal and confirmed by a pattern breakout on Wednesday, 8/30.  The candle put out on Friday marks either a reversal back to the trend line or it will flag before continuing to move up.  Target for SOXL is around 125 and is based off the pattern formation.

#techweek

Direxion Technology ETF (TECL) gained 4.89% this week, breaking out to new all time highs. Tech sectors look strong going into the short week, but there will likely be some profit taking.  The FAANG stocks all performed well gaining 17.41% collectively.

JBZ Stocks Watchlist – Week of 9/4/17: VRX, QCOM, NAVI, WPG, CTB

VRX Chart 09/03/2017
Valeant Pharmaceuticals (VRX): Diverging at the breakout point of a Head & Shoulders Bottom pattern and the breakout point of a falling wedge. There was also insider buying on 8/21/17. A Director purchased 10,000 shares at a cost of 14.33.
QCOM Chart 09/03/2017
Qualcomm (QCOM): Diverging at the breakout point of a falling wedge at a support level.
NAVI Chart 090317
Navient (NAVI): Coiled stochastic divergence, on a lower trend line, at the breakout point of a falling wedge. These coiled stochastic, while not above the 20 yet, are potentially very strong.
WPG Chart 090317
Washington Prime Group (WPG): This is a pick from a follower! After watching for a few days, it is definitely a good one for the watchlist. Stochastic divergence, on a trend line, at the breakout point of a falling wedge. See how the low touches the “X” on the chart. Great point for a reversal. Keep the suggestions coming!
CTB Chart 090317
Cooper Tire & Rubber (CTB): This was first posted last week and instead of taking off, it turned and coiled. Good news is that it offered another entry point. Last time it diverged like this the stock gained almost 20%.

 

#techweek continues as the sector looks strong right now with many active divergences playing out. Continuing to watch and trade AMD, NFLX, JD, FB, SIX.

 

JBZ Stocks on StockTwits Review – Week of 8/27/17:

NFLX Chart 090317
Netflix (NFLX): Formed 2 falling wedges and is set up with Stochastic Divergence to breakout of the current pattern. +4.99% on the week. It appears to be a bull flag, but could always return to the trend line.  If it does, there will be another opportunity for entry.
  • Netflix (NFLX): +4.99%
  • JD.com (JD): +2.41%
  • Advanced Micro Devices (AMD): +5.27%
  • Facebook (FB): +3.06%
  • Echo Global Logistics (ECHO): +10.51%
  • WestRock Company (WRK): +4.10%
  • Motorola Solutions (MSI): +.98%
  • Six Flags Entertainment (SIX): +.81%
  • Cooper Tire & Rubber (CTB): -.44%

Overall the collective gain of these posted stocks was +31.69% for the week.  I expect CTB to make some gains this week and is still at a good entry (see chart in this weeks watchlist above).