I won't be home till much later tonight, so there will probably not be an update. Also, remember that it's options expiration Friday tomorrow.


Good Luck,



Joey

Btuff posted another monster article over at RegulationFD. He goes into a deep comparison of two seismic data acquisition companies (DWSN and TGE). Below is my technical take for the two companies. I am introducing a ratio chart to show the relative performance of the two companies against each other.

TGC Industries, Inc. (Public, AMEX:TGE) vs Dawson Geophysical Company (Public, NASDAQ:DWSN)

A ratio chart simply divides the two stocks and forms a ratio. The ratio is shown from the perspective of the first stock listed (TGE in this case). Thus a rising ratio means TGE is outperforming DWSN. A declining ratio means the opposite is true. The chart below clearly shows DWSN's recent outperfomance. While TGE has been consolidating for several months, DWSN is already in a clear uptrend. This may change soon though, as the ratio is towards the bottom of an established range.

The interesting thing about ratio charts, is that trendlines and moving averages, etc. can still be applied to them. I like to use ratio charts to plot the relative strength of gold/dollar, gold/silver, DIA/QQQQ, etc. If you look at each stocks individual chart lower on the graph, TGE looks to be just breaking out of a consolidation, while it wouldn't be unreasonable to expect a pullback in DWSN. It's tough to say they will move in different directions, as they belong to the same sector, but TGE is probably the better value from a technical perspective.

(click on chart to enlarge)


While TGE may be in a better near term position, you can't argue that DWSN has been the stronger of the two, and may be an interesting play on a pullback. Either way, the sector looks pretty decent here and both may well end up being solid plays for some time to come. Make sure to read the fundamental take on RegulationFD, and please do your own due diligence.

disclosure: I don't own any shares of either company. Also, TGE reports tomorrow so don't do anything rash cause of this post.


Good Luck,



Joey

Today resulted in a narrow range day for most indices. It is starting to look like the rest of the indices will follow the S&P to new highs soon. While most have been looking for the correction to resume, the markets have had a different idea, punishing the bearish majority. I'm still of the opinion that we are grinding out a large top, but I will let price dictate how I trade.

Here is a chart of the Q's showing some more bullish signs. RSI is breaking a sloping trendline, making new highs with price. MACD is starting to make new highs and now there are two closes over the previous bearish gap resistance.
I don't usually like to post charts of stocks I currently hold, but the following two stocks look like they are close to breaking out.

VNDA has been having some weird intraday action recently with large block buys followed by very low volume pullbacks. While I tend to ignore this noise, the daily chart is starting to round up. MACD is in a leading divergence and volume is starting to tick up.
WIRE had a decent move today on increasing volume. It looks like it is trying to break out of this triangle and could ride the upper bollinger band to the 200sma at 29. That is near where I will be looking to take profits.


No new stocks on the list tonight as I am fully positioned right now. Also, don't forget options expire later this week.


Good Luck,

Joey

Several markets made new yearly highs today and the S&P 500 actually closed at one. Also quite impressive was the fact the several of the market ETF's gapped and never backed and filled the gaps. Everything about the day was very bullish, except for the lack of volume. I would think volume would be higher on a day where several indices ran away from gaps and challenged multi year highs, especially after the recent correction. One has to wonder if how much of this move is related to the large amount of hedging and the upcoming options expiration. Regardless of the reason, stocks are moving higher, and have yet to give short term topping signals. Several of the stocks mentioned over the last week have moved very nicely, and despite my cautious stance I find myself almost fully invested right now, even after locking in some gains today. I'm taking it one day at a time here and will be liberal in taking profits here.

Here is a chart that looks higher to me over the next few days.

Apple Inc. (Public, NASDAQ:AAPL)
AAPL's chart has been a little choppy recently, but it is looking like it may bounce off the 50sma and lower bollinger band here.

eBay Inc. (Public, NASDAQ:EBAY)

Another chart I found interesting was EBAY's. While I have no plans on buying EBAY I thought it there was an interesting plot forming on it. EBAY reports earnings on Wednesday and it appears that it is possibly on the cusp of a large move. It is looking very bullish on the daily chart just clearing several month base. While volume was just average, there hasn't been any high volume breakdowns either.


Where things get interesting is on the longer term chart. Take a look at this weekly chart of Ebay spanning the last four years or so. Ebay is overbought and heading to stiff resistance. It could easily turn lower after testing the down trendline, but you could also classify this as an ABC correction which already completed. This would put Ebay in Wave 1 for the Elliot Wave followers. I'm not a wave counter by any stretch, however, I can easily see this as the beginnings of a much larger move higher. I am officially adding them to my stalking list, while waiting for a pullback and decent candle pattern to emerge.



Good Luck,



Joey

In looking at the index charts this weekend, I noticed that they were becoming overbought already and heading into resistance. This is usually a recipe for further weakness or consolidation. The indices have been steadily climbing on low volume and something will have to give soon. Either they will roll over, or volume will come in on a short squeeze to new highs. They could really go either way here.

Here is a chart of the Q's showing how it's overbought on several different levels. In an uptrending market, a stock can remain overbought for quite some time. However, in a range bound market, a stock will usually oscillate quite regularly. The question is whether the Nasdaq 100 will begin trending here, or if it is still range bound.

PowerShares QQQ Trust, Series 1 (ETF) (Public, NASDAQ:QQQQ)

There are conflicting signals right now. While the indices may be overbought, there is still a lot of bearish sentiment and they are finding support at their rising 20smas. I also found a lot of good looking chart setups this weekend for long plays. I think the play right now is to stick to long setups and be ready to hedge with the inverse index ETF's such as QID and TWM.


ZOLL Medical Corporation (Public, NASDAQ:ZOLL)
Here is an interesting chart I found this weekend. ZOLL has retraced to the 61.8% fibonacci level, and has been consolidating in a pretty tight range. While this is probably not ready to bust out, it looks like a decent place for core traders to enter with a nice stop under the recent base.


TurboChef Technologies, Inc. (Public, NASDAQ:OVEN)
OVEN is one of the better looking charts I turned up. This may be completing what I term a partial retrace. Notice how OVEN has been making lower highs and lows in this pullback. Now it may be stopping short of completing the established trend of lower highs and lows, therefore making a partial retrace. If it does set a higher low here, then it may be an early signal that the trend is changing to an uptrend.


IntercontinentalExchange, Inc. (Public, NYSE:ICE)
ICE was one of the hottest stocks early this year, and has had a healthy pullback. It may be turning back up here and it sure looks like it will try and fill the bearish gap it left on 2/27/2007.


New Oriental Education & Tech. Group Inc (Public, NYSE:EDU)
EDU is a low volume choppy smallcap, but it is capable of nice moves. It is close to breaking out of a triangle like base and could be headed to new all time highs.


MEMC Electronic Materials, Inc. (Public, NYSE:WFR)
WFR just broke out of a small base and is looking at it's first pullback to a rising 20sma. This is usually a decent place to jump into the trend.


Snap-on Incorporated (Public, NYSE:SNA)
SNA broke out of a tight base in early February, but has since dipped back to the base. It looks like it may be reversing here and could be headed back to test the breakout highs.


Since the markets could just as well reverse here, I am highlighting a couple short setups. I usually won't short when the indices are over their 50 day sma's, but depending on the action the next few days, I will be keeping an eye on these.

Continental Airlines, Inc. (Public, NYSE:CAL)
CAL broke down on a head and shoulders top and has just retraced back to the neckline. This should serve as resistance, but there are a couple things that worry me on this chart. It found pretty good support on the rising 200sma and broke a minor down trendline. I am still watching it though, because the head and shoulders top is usually a good one.


ConAgra Foods, Inc. (Public, NYSE:CAG)
CAG had a similar breakdown, although the retrace has been no where as potent as CAL's. Here it is threatening to fall out of a little continuation triangle therefore resuming the downtrend.


Good Luck,


Joey