The S&P 500 (ETF Proxy – AMEX:SPY) has been grinding higher on a “flight to quality” as overseas investors are diversifying their funds against the volatility risk caused by the Greek/Eurozone crisis by bringing funds into the US Equity markets.
The long-term cycles remain bearish, but only a fool takes lightly the power that news of world governmental instability has to impact prices in the short term. No trades for me here until the supply/demand forces become less muddled.
Sprint (NYSE:S) has recently turned the corner, and formed an up-trend on its daily chart. The current correction is pulling back into areas of moving average support, and I would expect this stock to retest it’s highs near $5.25 per share, then perhaps make a run at the $6.25 level.
I would watch for daily reversal candlestick patterns such as the “hammer” candle that was left on the charts after Friday’s session, and would set my protective stop loss levels under that bars low.
Pfizer Inc. (NYSE:PFE) is another strong stock that has established momentum to the upside, and is pulling back into areas of moving average support.
The bullish engulfing bar on the daily chart acts as confirmation for me, and I would be looking at this stock for a long trade if prices break out above the Friday highs. Protective stop loss orders would be set under that bars low, and I would expect to take some profits off as new highs are seen in the $35-$35.50 area.