It remains to be seen if it will last, but with two big days of bullishness under its belt, the S&P 500 at least has a shot at rekindling its bigger-picture rally. Or, perhaps yesterday’s 0.82% jump is only a setup for the next wave of selling.
Whatever it was, Roku (NASDAQ:ROKU) set the tone, gaining almost 9% as a follow-up to Tuesday’s rally in response to a key upgrade from Guggenheim. Leading the charge, however, was Campbell Soup Company (NYSE:CPB) with its 10% advance. The food company popped following a quarterly earnings beat driven by strong snack-food sales.
There were some losers, however. In fact, despite yesterday’s gain, there were almost as many losers as there were winners, and there was more bearish volume than bullish volume. The biggest offender? Cloudera (NYSE:CLDR). The stock fell more than 3% during the regular session, but was off more than 30% in after-hours action after a disappointing Q1 was made worse by news that CEO Tom Reilly would be stepping down.
Headed into Thursday’s trading, however, it’s the stock charts of FleetCor Technologies (NYSE:FLT), Walmart (NYSE:WMT) and Pfizer (NYSE:PFE) that are of the most interest. Here’s a look at why, and what needs to happen next.
Just a few weeks ago, shares of drug company Pfizer were fighting a losing battle. Although still dishing out plenty of bullish swings, the undertow was bearish, marked with clear, falling support and resistance lines.
That downtrend may still be intact. But, PFE is close to punching its way out of it. Not one but two crucial ceilings are now being pressured, and one more good day could get Pfizer over a major hump.
- The first of those technical ceilings is the line that traces all the key highs since February, plotted in yellow on both stocks charts.
- The second line in the sand is the white 200-day moving average line, plotted in white on both stock charts. Clearing both lines could easily prove catalytic.
- What’s different about this effort from others is that this one has the advantage of starting out with a bullish MACD cross on the weekly chart.
FleetCor Technologies (FLT)
After a rough finish to last month and an equally poor beginning of this one — marked with a move under its purple 50-day moving average line — it looked like FleetCor Technologies shares might snap out of that funk on Tuesday. No such luck though. While the stock was up for a short while on Wednesday, the sizeable reversal back into the red actually underscores how much trouble FleetCor shares are in.
- FLT only had to approach the blue 20-day moving average line yesterday to inspire a renewed wave of profit-taking that dragged shares back under the 50-day line.
- Although the daily chart suggests how overbought FleetCor Technologies shares were into the end of May, the weekly chart confirms the stock was technically overbought and ripe for selling.
- This may be part of a bigger effort to close the gap that was left behind in February, which is highlighted on the daily chart.
Finally, back in mid-May we pointed out Walmart shares were being squeezed into a converging wedge pattern. Although the longer-term and shorter-term trend appeared bullish, the bears still had an opportunity to quell that rally and even knock the stock back into a downtrend.
As of Wednesday though, that doesn’t look like it’s going to happen. With a little help from the broad markets, WMT has broken above the upper boundary of the converging wedged pattern and is positioned to make a healthy move that has been largely on hold for months.
- The upper boundary is plotted in white on both stock charts, extending back to the early 2018 peak.
- At the same time, the upper edge of the converging wedge pattern has been pierced, a near-term horizontal ceiling around $104.07 has also been hurdled.
- Although it has been inconsistent at times, the Chaikin line’s cross back above zero in April has further diverged, suggesting there’s healthy volume behind the advance up until this point.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about James at his site, jamesbrumley.com, or follow him on Twitter, at @jbrumley.