The daily chart shows the current basing action holding above all three major averages in April, May, and June, with a few bullish shakeouts along the way.
$SLX has rallied up to the short-term downtrend line, but we are waiting for a low-risk entry point to develop (on a test of the moving average support level around $46.50):
$SLX should hold above $45.50 for the setup to remain in play in the short-term. A clear break of $45 may not kill the pattern, but would certainly require a few weeks of consolidation to repair the damage.
On the individual stock side, we do not have any new setups for today, but we did change the position sizing for our Tesla ($TSLA) long setup to 40%. We added two new positions to the portfolio yesterday, and our existing position in $IDTI followed through nicely to the upside.
Recent stalling action on the daily chart of the S&P 500 suggests that the uptrend may need some rest IF the price confirms with a clear breakdown below Monday’s low.
Along with the S&P 500, the Russell 2000 may be due for a few days of rest as it approaches important resistance from the high of January at 1,182. There was also some stalling action in the semiconductor ETF ($SMH), as it closed near the lows of the day on heavy volume. Again, these one-day reversal signals on candlestick charts do need to be confirmed.
This article is brought to you courtesy of Morpheus Trading, LLC.