Another day, another gain. Monday’s 0.35% advance from the S&P 500 was enough to take the index to multiweek highs. The close at 2,850.40 was also the best close since early February. Facebook (NASDAQ:FB) offered the most help to the broad market, up 4.5% on reports that it was looking for ways to sync up with users’ banking information. Sprint (NYSE:S) jumped 10% on the heels of news that a merger between it and T-Mobile (NASDAQ:TMUS) was back on the table.
Not all stocks marched higher with the market, however. Newell Brands (NYSE:NWL) tumbled to the tune of 14.4% after lowering earnings guidance for a fourth time in twelve months.
Not every name was going hog-wild on Monday though. Far more tame were stock charts of GGP (NYSE:GGP), Alaska Air Group (NYSE:ALK) and Varian Medical Systems (NYSE:VAR), which are heading into Tuesday’s action as a trader’s top prospects — largely because they didn’t dish out tricky, unfounded volatility. Take a look.
Most REITs have been edging higher for a while now, bouncing back from weakness earlier in the year. Traders were fearful that interest rates would soar, and though they’ve moved higher, it’s been at a measured pace. Meanwhile, brick-and-mortar retailing continues to recover, as better-paid consumers finally start to treat themselves.
Both are trends that retail space landlord GGP benefit from. Thanks to Monday’s modest strength, though, a budding uptrend has gelled quite nicely.
Click to Enlarge • The triggering event here is Monday’s move above the 200-day moving average line, though on both stock charts we can see that the bullish volume has been growing in step with the rally.
• There’s a likely resistance line at $23.85, where VAR bumped into a technical ceiling late last year and early this year.
• There’s plenty of momentum in place here. The weekly chart gave us a bullish MACD cross several weeks ago, and that divergence has continued to widen. Yet, there’s still plenty of room to recover.
Varian Medical Systems (VAR)
Varian Medical Systems is acquiring privately held humediQ Global GmbH, but given the stock’s 1% slide on Monday, investors don’t seem terribly stoked about the idea. Or, maybe Monday’s weakness is just a continuation of the well-framed downtrend that has been in place since early this year.
Whatever the case, the trend is bearish, and one or two more bad days could drag VAR under a major horizontal support level. If that happens, the downtrend has a good chance of accelerating.
Click to Enlarge • The selloff is framed rather tightly, on both the weekly and daily charts, by white, dashed lines. Note that VAR shares are now below all the key moving average lines, and the 20-day line (blue) just crossed below the 200-day moving average (green).
• There’s a horizontal support line (red, dashed) at $112.03. A break below that level leaves the stock without many other support opportunities.
Alaska Air Group (ALK)
Last year was a rough one for Alaska Air Group, and for its shareholders. This year didn’t start out so hot either. Take a closer look at both stock charts though. That weakness has slowed to a crawl, and even halted. Indeed, the bulls are testing the waters of higher highs, and a major bullish triggering event is in sight.
Click to Enlarge • A horizontal floor has developed at $57.86, ultimately serving as a pushoff point for the budding rally.
• Also, on both charts ALK shares have fought their way above a falling resistance line (white, dashed) that extends all the way back to July of last year.
• The triggering event we’re waiting for is a move above the 200-day moving average line (white). The turnaround has been slow and methodical, but healthy. If ALK breaks above that likely resistance level, there’s little left that will be able to hold the recovery rally back.
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.