These are stocks I’ll be monitoring over the next week to form valid patterns and potentially trigger a trade. I am currently scanning for and trading continuation contraction patterns.
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Before getting to the potential swing trades for this week, let’s look at the overall health of the market.
Stock Market Health Check for Swing Trading
Last week I said I was restricting purchases as we had some warning flags.
Since then, the market has pushed higher and the warnings signs have dissipated.
The amount of capital I deploy is still based on the number of high-quality trade setups. Things can look great on the indexes, but if there aren’t great opportunities in individual stocks, then very few or no trades are taken. We’ll discuss the current trading opportunities below.
Charts provided by TradingView.
Here are the market health indicator statistics…
- More than 58% of NYSE stocks are above their 50-day moving average (top indicator). That means lots of stocks in uptrends—favorable for swing trading on the long side. More than 73% of all US stocks are above their 50-day average.
- The blue bars show the daily rate of change in % (second from bottom). Price declines contain large single-day drops. We recently had two large single-day drops. This indicator is still in warning flag mode.
- The NYSE Advance-Decline Line (bottom indicator) is near its high as the S&P 500 approaches its high. This shows wide participation in the number of stocks advancing.
- All the major indexes are performing well currently (not selective). This is good. The NYSE Composite is still a ways off its highs, while the S&P 500, Nasdaq 100, and Russell 2000 are quite close to theirs.
- From a price action perspective, we are in an uptrend over the longer-term and shorter-term.
US Swing Trading Watchlist
286 stocks on the scan list, reduced to those below.
JOE – Contracting. Near pattern high. Awaiting consolidation.
DFIN – Contracting. Near pattern high. Awaiting consolidation.
MDB – Contracting. Near pattern high. Awaiting consolidation.
NET – Contracting. Near pattern high. Close to completing consolidation.
RDFN – Contracting. Near pattern high. Awaiting consolidation.
XXII – Contracting. Near pattern high. Awaiting consolidation.
FRHC – Contracting. Consolidating. Consolidating is big compared to prior consolidations in the advance.
PDD – Contracting. Near pattern high. Awaiting consolidation. Pretty small pattern.
Need More Time, Haven’t Fulfilled Requirements
AMSC – Contracting.
ARWR – Contracting.
BEEM – Contracting. The pattern is bigger than prior ones.
BLDP – Contracting. Less than the one-month minimum requirement.
SBE – Contracting.
DOMO – Contracting.
GP – Contracting. Watching the small contraction since Jan. 6. More of a cup and handle.
Canadian Swing Trading Watchlist
129 stocks on the scan list, reduced to those below.
AJX.V – Contracting. Consolidating.
EU.V – Contracting. Consolidating.
GGD.TO – Contracting. Consolidating a bit above pattern.
ACQ.TO – Contracting. Moved above the pattern. Needs to consolidate quickly.
Need More Time or Haven’t Fulfilled Requirements
AT.TO – Contracting.
BLDP.TO – Contracting. Under the one-month minimum requirement.
BZ.V – Contracting. Just under the one-month minimum requirement at this point.
CBDT.CSE – Contracting.
GPV.V – Contracting. Watching the small contraction since Jan. 6. More of a cup and handle.
HPQ.V – Contracting.
IPA.V – Contracting.
NOU.V – Contracting. Still under one-month minimum requirement.
WELL.TO – Contracting.
Cory Mitchell, CMT
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Disclaimer: Nothing in this article is personal investment advice, or advice to buy or sell anything. Trading is risky and can result in substantial losses, even more than deposited if using leverage.