Breakout Expected In The Global X Social Media ETF (SOCL)

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December 23, 2013 3:34pm NASDAQ:SOCL NYSE:SEA

sellbuyMorpheus Trading: Last Friday, we established a buy entry in Guggenheim Shipping ETF (NYSEARCA:SEA) on breakout above the two-day high. We really liked the bullish consolidation that formed around the 50-day MA, especially when the price action tightened in December.


$SEA breakout

After clearing prior highs at $19 and breaking the current range high at $20.50, there is very little resistance until the $24 area, so we might be able to hold on to the position for a 15% to 20% move.

We added to our current long position in Global X Social Media ETF (NASDAQ:SOCL) on Friday (entry #2), as it cleared the high of the bullish reversal candle on Dec. 18. Our first entry was on Dec. 8, as $SOCL climbed back of the 50-day MA.

$SOCL CUP AND HANDLE BREAKOUT

The price action since Dec. 11 appears to be forming a handle. A handle is a tight range that is at least one week in length (can be several weeks or more) that develops usually 5% to 10% off a base high.

The current handle in $SOCL is eight days in length. Look for a breakout above the high of Dec. 10 to confirm the pattern.

Please note the lower entry price in the $PGJ buy setup on the watchlist above. $PSP paid out a 62 cent dividend last Friday, and we remain long with a dividend adjusted stop.

Our scans continue to produce bullish chart patterns, so with the market back in trend mode it is just a matter of waiting for low-risk entry points to develop.

This article is brought to you courtesy of Morpheus Trading, LLC.

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