The bulls are finally doing a nice job of breaking out of the long trading range to the upside. The S&P 500 is above the key 2180 level and now the important thing is a close near that level.
The bears should be happy to see this sort of breakout because a failed breakout is a better setup for potential downside than simply dropping out of the recent trading range. This breakout should suck in money that has been sitting on the sidelines and that provides more fuel for selling should the market reverse.
After this long trading range, there is a much greater chance that the computer algorithms will be programmed to jerk us around as emotions build over a breakout. As I've stated, I don't expect it to be a clean uptrend after the breakout, but for now the bulls have the edge and they are handling it well.
The market action is solid and my hunt for individual stock picks continues.
Here are a couple charts I listed as Shark Technical Buys this week that are setting up well.
Energous (WATT) has developed wireless charging technology and has long been rumored to be close to landing major contracts. The key is a move above the $13 level on increased volume.
NeoPhotonics (NPTN) is a small biotechnology name with a cup-and-handle pattern. It is pushing toward the $14 level but also needs more volume to get it moving.
Other hot stocks on my scans include Five9 (FIVN) , Sino-Global Shipping America (SINO) , Kratos Defense & Security Solutions (KTOS) , Archrock (AROC) , Ocean Power Technologies (OPTT) and Momenta Pharmaceuticals (MNTA) . (Editor's note: KTOS is also a holding in the Stocks Under $10 model portfolio managed by David Peltier.)
Please note that due to factors including low market capitalization and/or insufficient public float, we consider many of the stocks mentioned in this article to be small-cap stocks. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.