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STOCKS


Yoga, Transitions, Market Reversals

06/22/12 11:37:03 AM
by Billy Williams

The market is now in transition, so be sure that you're on the right side if you want to profit.

Security:   QCOR, WFM, JBHT
Position:   Buy

Yoga is more than a physical exercise; it is also a means by which to harmonize the physical, mental, and emotional/spiritual energies of an individual in order to achieve clarity. Attaining a level of harmony through deep relaxation from yoga practice reduces the friction of negative self-talk, old injuries, and mental/emotional baggage that are a part of the human condition that allows the true self to come through as a result.

In technical analysis of the stock market, you hope to spot where market forces on the fundamental and technical level are in harmony with the overall market to achieve the path of least resistance in order to enter a trend at the precise time where it has the most efficient path toward a given target. See Figures 1 and 2.

FIGURE 1: JBHT. JB Hunt Transport Services experienced a runaway gap as the stock has been in a persistent trend and the gap signified strong upward momentum. Price traded through a buy point of $58.02 at the open of the trading day on higher volume, followed by another price surge. Price continued higher on increased volume and closed at the upper end of the price range, indicating that momentum was firmly in the bull's corner.
Graphic provided by: www.freestockcharts.com.
 
Over the last several weeks, the market has been encountering a lot of friction as hopes, fears, and negative sentiment collide and create a drag on efficient price movement, but now the market appears to be in transition. After encountering a lackluster Friday on the major indexes due to the triple witching, the market has shifted from bearish/neutral to bullish and begins the climb higher.

New highs were made as progress was measured in inches on the SPX's advance, but progress was made, nevertheless. The central banks were given their marching orders by the G20 and told to stabilize the financial markets if the worse came to worst after the Greek elections and the far-left political parties seized power.

The belief is that the terms were too onerous and there was no obligation to honor them. Such a move would destroy Greece's credibility and standing in the EU and would have far-reaching implications to the rest of Europe's financial markets, and possibly the US as well.


FIGURE 2: WFM. Whole Food Markets was up over 3% as it traded through a buy point of $96.10. Price surged as the overall market headed higher and the high RS stock continued its upward movement on increased trading volume.
Graphic provided by: www.freestockcharts.com.
 
Still, this defensive move on the part of the central banks firmed the backsides of the stock market, forming a bottom and a new price high. The result is that new stocks are beginning to lead the market and trade higher.

Questor Pharmaceuticals (QCOR) has formed a cup & handle pattern with a buy point of $46.94 and traded through that level on higher volume. The company recently announced that it would expand its commercial use of Athcar to rheumatology applications, which should translate into a new revenue stream for the company.


Whole Foods Markets (WFM) was up over 3% on Friday's action as it traded through a buy point of $96.10. Price surged as the overall market headed higher and the high RS stock continued its upward movement on increased trading volume.

JB Hunt Transport Services (JBHT) experienced a runaway gap as the stock has been in a persistent trend and the gap signified strong upward momentum. Price traded through a buy point of $58.02 at the open of the trading day on higher volume, followed by another price surge. Price continued higher on increased volume and closed at the upper end of the price range, indicating that momentum was firmly in the bull's corner.

Stocks could continue to trend higher, but it would be wise to be cautious trading during the summer doldrums as well as remain alert to any news from Greece that could have a negative impact on the markets. Any negative impact should be minor in the short term, with strength likely to remain on the side of the bulls now that the central banks are taking an active role in supporting their financial markets, which will spill over to the rest of global equities.




Billy Williams

Billy Williams has been trading the markets for 27 years, specializing in momentum trading with stocks and options.

Company: StockOptionSystem.com
E-mail address: stockoptionsystem.com@gmail.com

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