Tuesday, June 28, 2011

Active Screen - CANSLIM: Top 8th for June 28th

The CANSLIM top-8 scan saw Research in Motion (RIMM) dropped on fundamentals - finally - and Silver Wheaton Corporation (SLW) in at eighth place. The last installment from June 14th can be found here. The following CANSLIM stock screener settings were employed:

Still top dog on the list is AAPL. After losing $330 support it was able to successfully defend channel support. It went on to regain the 200-day MA and is well positioned to rally to channel resistance, although the intermediate trend remains down. The channel remains on course to test the next level of support at $300.

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Vale S.A. (VALE) remains within its downward channel. The current rally may have the legs to make it to resistance (about $1 away), although it has long since said good bye to its 200-day MA and suffered a 'Death Cross' between 50-day and 200-day MA in May. Bulls likely to remain lukewarm on this until the channel breaks.

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Baidu (BIDU) made a picture perfect defense of $115 support + channel support + 200-day MA as it rallied to - and through - channel resistance. Next up is $140, i.e. the June reaction high.

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Next is Barrick Gold (ABX). The head-and-shoulder pattern is still in play, although prices haven't dropped through the floor. A small rally stalled out at $45, marking it as an area of supply. Next price to test is the July reaction low at $40.

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Cognizant Technology Solutions Corp (CTSH) had previously sliced through $72 support and 200-day MA in a single day. It went on to spike low at $66 before recovering to $72, which is now resistance. However, the rally back to $72 did do enough to break declining resistance, so there is buying momentum. $70 is key support - anyone who purchased stock recently would probably perceive $70 as the line in the sand for deciding whether to hold, or bail.

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Netflix (NFLX) attempted a breakout in mid-June which gave bulls a bit of fright when $255 support was lost and it dropped to $240. The stock has since recovered but it's unlikely to survive a second round of selling, particulary if $250 was to break again. The current rally won't see resistance until it gets to $275.

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Agrium (AGU) hasn't quite found its groove but its playing more as a sleeper. It's lingering around its 200-day MA; unable to break supply, but comfortably defending $78-80 support. While not exciting it's off-the-radar approach isn't doing any harm either. When stocks start moving and you look back at a chart and ask yourself, "Why didn't I buy then", this is what the chart looks like. Watchlist material.

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Finally, new kid-on-the-block Silver Wheaton Corp is in at 8th place. The mining stock was able to defend $30 support last week but is encountering selling at declining resistance. This has resulted in a price squeeze which will soon resolve one way or the other. A break of support and the next target down is around $26; break resistance and $37 comes into play. No clear signal yet as to which way this will go.

Zignals Chart Image


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