Most investors would agree that the issues caused by the novel coronavirus haven’t been completely resolved yet. Still, it was nothing but upside to start the week on Monday as investors saw a light at the end of the tunnel. And Tuesday’s big stock charts show some of that illumination.
This could be an ideal entry point for momentum-focused traders. After a tough time in March, April might be a turnaround month if conditions improve.
The three big stock charts for Tuesday will focus on the ones that really showed strength and leadership. Traders can hope that it was more than just a head-fake as the world attempts to recover from the pandemic.
Salesforce (CRM)
It sure looks like the bears went into hibernation when it came to Salesforce (NYSE:CRM) stock. It tacked on over 9% on Monday. Will the forces align to keep the stock in the green throughout the week?
- That $140 resistance level really needed to be broken. Monday’s big candlestick achieved that and now the support line is a resistance line.
- Note that Thursday’s candle was a spinning top, signaling indecision in the markets. It looks like they made their decision now, and it’s a positive one.
- The stock also broke out of a long-standing falling wedge, finally. That’s yet another good sign for the bulls and a cause for celebration.
Schlumberger (SLB)
Oil slid while Schlumberger (NYSE:SLB) stock roared ahead with a nearly 10% single-session move. That’s a great sign, so perhaps a comeback could be in the offing.
- A classic double-bottom chart pattern is now taking shape. That’s one of the most well-known bullish patterns recognized by market technicians.
- On the other hand, the stock did meet resistance at this exact same price level last month. Bulls really want to see some follow-through here.
- It’s tempting to view $40 as resistance, but don’t get greedy. Taking profits at $20 or $30 would still yield impressive returns.
Monster Beverage (MNST)
As you can see from the third of our big stock charts, Monster Beverage (NASDAQ:MNST) made a monster move (you saw that one coming, didn’t you?) of 7% to begin the week. Will the next few candlesticks get a nice caffeine boost as well?
- It’s encouraging to see the stock break through the frustrating $55 resistance level. Bulls will hope that this level will provide strong support going forward.
- Be advised that this stock reached this same level not long ago, and it was nothing more than a head-fake. Therefore, it’s not a bad idea to maintain a tight $55 stop-loss.
- Still, the shape of Monday’s candlestick suggests strong forward momentum. A long lower wick, a long green body, and only a slight upper wick indicate that the trading community is preparing this one for higher prices.
As of this writing, David Moadel did not hold a position in any of the aforementioned securities.
