Hey Traderaders! Just wanted to share a few charts that I've been watching from a Swing Trading perspective. My favorite setups for Swing Trading involve entries where I'll know if I'm wrong right away...I don't like to sit around and wonder if my trade thesis will work out. Here's 3 charts that meet the criteria for me:
Ticker: UMC
United Microelectronics Corporation is in the semiconductor foundry business and its Daily Chart has reached an interesting place. Last week, the 50 Daily Moving Average proved to be a ceiling for price and now it sits on the edge of a large volume shelf. There's a price gap to fill down to $5.86, which represents about a 10-11% gain on the short side from where it is now. Also, when RSI and DIX has had this level of divergence in the past it has not been favorable for price.
Ticker: LXU
LSB Industries manufactures various chemical products for the agricultural, mining, and industrial markets. The chart has reached an interesting spot, in my opinion. I was watching today to see if it would clear the 200 Daily Moving Average, but the sellers stepped in right as it touched it. I have alerts set to take a long at $15.20, which would clear the 200DMA and the 50DMA. If the selling continues I'd be interested in shorting the stock if it loses that support line.
Ticker: TOL
Despite decent earnings today, Toll Brothers, Inc. is operating in one of the toughest industries conceivable right now: Suburban home building. The chart above is a Weekly Chart, but TOL has seen intense selling volume over the past 3 trading days. It now sits right at support at $45.40. I have alerts set to short the stock at $44.75, which would clear a tiny Low Volume Node at $45.20. As you can see from the chart above, it's also sitting right at the 200 Weekly Moving Average, a key level it's held several times now; however, the more support a level provides the weaker it tends to get. I personally struggle shorting profitable companies, but unless the buyers step in soon TOL looks primed for a potential leg down.
As always, these thoughts are not to be considered financial advice, I'm simply sharing what I'm looking at from a trader's perspective. I hope you've found it interesting!
Happy Trading,
Horse