5 stocks showing technical buy signals
The companies, in very different sectors, have all crossed their 50-day moving averages to the upside.
Traders know that when a stock crosses over its 50-day moving average to the upside, that's a bullish sign. We screened thousands of stocks and found five that might be worth some of your research time.
Comcast (CMCSA) is a diversified media company with 22 million cable subscribers as well as a majority stake in NBC. The stock was up 1.5% on Friday, which put it above its 50-day moving average on reasonable volume.
The chart, going back to August, is highly bullish with a solid ascending channel throughout. A recent pullback has created a compelling entry point.
J.C. Penney (JCP) was up more than 11% on Friday on news that Goldman Sachs (GS) arranged a $1.75 billion financing package for the company and that George Soros bought an almost 8% stake in the company. Large scale events like this don't necessarily make for reliable technical analysis, but if J.C. Penney can hold Friday's move, it could challenge the upper trend line resistance sitting around $20.
ConocoPhillips (COP) is an integrated oil and gas company with a $77 billion market cap. After selling off to a low of $56.81, its 200-day moving average, the stock has rallied nearly 4%, breaking above its 50- and 20-day moving averages.
Traders will look for it to challenge its double top at $61, but there is resistance along the way. Still, the chart action could make for a favorable trade.
Look beyond the noisy chart and what you find is a stock with a lot of potential. Home builder stock, Toll Brothers (TOL) recently found a bottom at $29.87 and has since rallied an impressive 16% in one week. The stock is above its 50-day and is on track to challenge its upper trend line sitting around $35.40. A break above that would set it up to challenge the $36.50 and $38 levels.
However, a strong move in such a short period of time will likely correct very soon. Watch the support levels carefully.
Footwear retailer, Foot Locker (FL) has been in a trading range since November. It rallied from recent lows to break above its 50-day and is about to challenge its 200-day. A break out from its 50-day is a bullish sign but since the beginning of March, the stock has printed a series of lower highs on diminishing volume. Until the stock can convincingly break above the $35 level, this stock is best avoided. Keep it on your watch list.
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At the time of this writing Tim Parker had no position in any of the stocks mentioned.
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