The Student Loan Ranger

Bit of a new look Crystal Balling in terms of the charts this week. This should reduce the amount of time it takes to write everything up, time is limited this weekend. This week I'm trying to keep it a bit more simple, focusing on more solid patterns and potential breakouts/breakdowns. A couple of new lows in here too.

Afren (AFR)
I've been watching this one for a while - and I'm trying to keep monitoring past watchlist charts as many of them get stronger in the following weeks. AFR has been in an uptrend for quite some time, and this new phase sees it consolidate between 180 and 160. In the more short term, it has formed an ascending wedge after a breakout at the end of March.


AFR has found support on this EMA since the initial up moves. A bearish rejection of 182 earlier in the week has seen this slip back, with the stochastics dropping down. These are the early signs of AFR finding support at 160, the 50 day moving average, or the ascending wedge trend line.

My entry signals long are breaks of 185 to targets at 220, while my entry points short are breaks of 155 to 140. Quick fingers could trade inside the range, but I'm looking for higher probability trading.

Dragon Oil (DGO)
An oil stock that has been out of favour for the past month, DGO might be finding some support at around 420, which coincides with the longer term trend line. Although it has failed the MA(50), which provided support, the horizontal support is looking to provide a cushion for the third time.
The MACD is improving on lower lows on the SP, as the stochastics are a bit messy to call right now. Entry long on breaks of 440 with targets at 550. Entry short on breaks of 400 with targets of 350.

Ferrexpo (FXPO)
A momentum play from 2 weeks ago, the chart is looking a little better now for long term strategies. After breaking out, the SP dropped to prior resistance and has been in between 410 and 440 this week. Normally, a stock will break, retrace to support or consolidate, and then make its move.

FXPO has been finding support at the 50MA, and this trend may continue as it consolidates and looks for moves up or down. Keep an eye on moves south of 400 for a short entry. I am bullish here, and I will be looking for either a move off the MA, or a nice break on volume over 440, with initial targets at 480, but also a likely breakout. MACD histogram is looking quite good for divergence.

Eurasian (ENRC)
Good uptrend stock showing resistance at 1500. Short term ascending wedge with horizontal support at 1400. Negative divergence on MACD which I don't like. This is quite a straight forward "enter on new highs" play, with the added "enter on sub 1400 breaks". I would cover a short of 1400 at 1300 which is potential support, but probably trailing stops in case we see a good breakdown. Targets for long is a case of trailing stops, and looking for new support and resistance levels.

My bro showed me this chart, and it is quite a nice one.

Kingfisher (KGF)
Quite a boring descending wedge-come-channel-come-new lows chart. Short on breakdowns of 110. I'm bearish here and don't expect to see a long signal (breaks of 155) anytime soon.

Look for resistance at the MAs on KGF.

Marstons (MARS)
From the same watchlist as FXPO 2 weeks ago, MARS has also developed quite nicely, triggering our original sell price this week. These descending wedge and channel breakdowns are very strong at the moment, a good reflection of the market in my opinion.

I do not envisage any long signals, as this one is for the bears. Short on further drops off Mondays close, with a stop at 201. Don't get spooked by the retrace to old support, as this is the exact opposite of a bull break.

Renovo (RNVO)
Our old "top of the gainers or losers list" friend RNVO, also from a few weeks ago. This chart is pretty simple. Enter long on volume backed breaks of 43, with stops at 38 - targets over 50p. Ascending wedge off a double bottom at 27. bear breaks of 27 is an indicator to short, but I feel quite good about this stock.


RNVO is likely to move fast again when it gets going. Although the 40 area was rejected strongly on Friday, look for a drop off to support by the 50 day moving average, or a horizontal support price of 35. The earliest signs will be moves out of the consolidation range of the past week (bull/bear flag break). Those who dare may consider a short on early breakdowns of 33, but this represents a high risk entry. Renovo could be a nice longer term play too.

WPP Group (WPP)
A lot of negativity on this chart for the past 8 months as it consistently failed to break the 640 range resistance. It has also failed some bullish patterns, such as a few inverse heads and shoulders, an ascending wedge and multiple double bottoms. It is no surprise it broke down last month, and on Friday it made new lows.

I am very bearish on WPP. My entry signals short are prices sub 520 on Monday, with trailing stops. This could easily to a BDEV, RBS or TNI style meltdown in the coming weeks.

The chart I dislike the most is KGF, as the daily volatility is quite high, and may provide some false entry signals, or scare you out of a position on a false comeback. The rest of the setups are quite clean, and should hopefully provide good fodder this week.

I am also watching these stocks, but do not feel it necessary to provide charts:

• TATE on continued new lows
• SFR on breaks over 282
• JKX - support at 440, or a meltdown?
• SXS - support at 711 to hold a third time?
• EME on a strong and very bullish hammer candlestick off the 50 ma on Friday
• Passively watching the coal stocks for new highs and retracements.
  

From the above I like the look of TATE and SXS in terms of the looks. The new highs in coal and mining could really go either way on you. In total there are 13-16 to watch this week, but I will be focusing mostly on the 8 core stocks from the watchlist.