Trading Ideas For The Week Of 7/3

Here are some stocks/sectors to watch for the coming week. Remember that these are only possible ideas/setups that you may want to add to your watch list. Here we go.

BURL- Burlington stores has had a huge run having quadrupled in price from its October 2013 IPO. Its belongs to the Retail/Discount Stores group that has traded sideways for over two and a half years now and recently suffered a huge gap down that corresponded with the Amazon buyout of Whole Foods. Up until now Burlington has been immune to the retail bricks and mortar underperformance but may be showing signs of weakness to come. The stock suffered a hard, swift  three day sell off that commenced on 6/20 with the stock losing nearly 18% before it was able to stop the bleeding and recover to finish higher on 6/23. It has since been able to climb into the low 90’s gaining back roughly half those losses. On Friday the stock printed a narrow range bar that can often lead to price expansion in the days to follow. If the stock were to sell off back below the 90 level this week, a short position could be considered. Subsequently, a conservative stop could be placed roughly near the 50 day EMA putting a cap on any losses. Be aware however, shorting is considerably more difficult than simply being long and much care and attention need to be taken. Although most of our shorting is done in bearish markets there are good set ups that can come along at any time in severely underperforming sectors such as this one and we feel Burlington may be primed for a correction. Here is a look at the daily chart of BURL plus a daily and weekly look at the sector.

BURL.png

DiscountStores1.png

DiscountStores2

CSIQ- Last week we wrote up the Solar Technology sector as a possible area that may be undergoing a trend transition. Canadian Solar was one of those stocks that hit our radar. After a steady three year decline, the stock is making a third attempt at rising out of a nearly eight month sideways consolidation along a bottoming base. The two differences with this third attempt are that the stock may be seeing some follow through, something that the two previous attempts lacked. Secondly, the sector has recently shot up from #102 to the #9 performing group over the last several weeks. We feel that if the stock can close above the $16.00 level it may offer a good long opportunity. Be aware that trend transition set ups such as this fire off many false starts before ever truly changing character. The good news is that these patterns often offer up conservative stop areas should they not play out. In this case a stop near the $14.00 level seems appropriate. Here is a look at the CSIQ and Solar technology charts.

SolarTechnology

CSIQ

-CJ

Charts TC2000

 

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