Next stop: Upside resistance levels?
Still a mixed-to-positive picture in the weekly trend analysis. For now at least it appears likely that the market may continue to work its way higher.
If it does, the big question will be what happens when it reaches upside resistance levels (of about 1300 on the S&P 500 and 11400-11500 on the DJIA)? A move above those would certainly suggest a re-test of the highs (at least for the S&P and DJIA), or even new highs.
On the other hand, a breakdown from here back down to or below the recent lows (about 1220-1230 on the S&P 500 and 10700 on the DJIA) would spell trouble.
New positions
No new positions this week, but not for lack of trying. I tried to sell puts in Pfizer (PFE) as it pulled back from its recent rally, and in CBS Corp. (CBS) as it sold off on Thursday after reporting “disappointing” revenues. I’ll probably try again with both of these this coming week on any further weakness.
Watchlist
Stocks of interest showing up on this week’s “upside strength” scans include American Electric Power (AEP), AT&T (T), Bank of America (BAC), Dominion Resources (D), Exxon (XOM), Harley Davidson (HDI), Johnson & Johnson (JNJ), KeyCorp (KEY), Mattel (MAT), Procter & Gamble (PG), and U.S. Bancorp (USB).
There are a lot of “oversold” candidates attracting my interest as put-selling candidates, especially if they go lower from here. Many I’ve already mentioned in recent posts, but a few new ones include Barnes & Noble (BKS), Louisiana Pacific (LPX), and Protective Life (PL).
