For a short while on Tuesday, stocks were crushing it. But, only for a short while. By the time the closing bell rang, traders were once again terrified, sending the S&P 500 lower to the tune of 0.86%. The close of 2699.63 was the lowest close all month, with the setback led by iQiyi (NASDAQ:IQ) — it closed 13% lower for the session.
The overall American tech sector was hit particularly hard. Advanced Micro Devices (NASDAQ:AMD) lead that charge with a loss of 3.4%, leading to a 1.7% stumble for the group overall.
Still, trading is done on a case-by-case basis, and right now the stock charts of SunTrust Banks (NYSE:STI), Southern Co (NYSE:SO) and Snap-on Incorporated (NYSE:SNA) each make a pretty compelling trading case.
Big Stock Charts: SunTrust Banks, Inc. (STI)
Not only are most bank stocks struggling right now, many of them have made their way past a bearish tipping point. Not SunTrust Banks, though. That’s the best part about this blooming opportunity … there’s a lot of room ahead for more downside, if one more floor is broken.
- That floor is $64.86, where the 200-day moving average line is. That’s also where SunTrust shares hit a low several times since March.
- There’s also been lots of volume behind the bearish days seen since May.
- The most plausible downside targets are $56.24, $51.08 and $45.92, where key Fibonacci lines lie. The first two of those three levels also coincide with prior highs and lows, from the first half of 2017 when shares are trapped in a sideways range for quite some time.
Big Stock Charts: Southern Co (SO)
It’s just as much of a sector play as it is a company-specific trade. But, that doesn’t really matter. If Southern Co shares are rising because utility stocks are rising — as part of a flight to safety — then it’s rising for a reason that could last for the foreseeable future.
It’s just a happy coincidence that so many other bullish hints are falling into place.
- On Monday, SO shares hurdled their 200-day moving average line, and then found support at it in the meantime.
- The bottom made in early June is actually part of a push-off of a rising support line that extends all the way back to late-2013.
- If the overall market continues to struggle, the bullish undertow for utilities should persist.
Big Stock Charts: Snap-on Incorporated (SNA)
Last but not least, though any stock that managed to make forward progress against Wednesday’s bearish tide is impressive, that’s not the only thing that makes Snap-on Incorporated so interesting here. It’s the context of the gain that solidifies the bullish case.
- SNA shares have recently crossed above their 200-day moving average line, and though the market tide has been pointed lower for the past couple of weeks, the bulls here have been testing the waters of higher highs.
- There’s also been lots of bullish volume behind the “up” days of late, while the losses have been on tepid volume. The Chaikin line’s move above the zero level to multi-week highs says this movement has some strong backing.
- The bullish swing seen over the course of the past couple of weeks is ultimately feeding off of a strong horizontal support line at $141.30. It’s been verified several times since 2015. The upper side of this expanding trading range is currently at $186, but rising quickly.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can follow him on Twitter, at @jbrumley.