It's Friday, so why not a little something for everyone? Let's look at five bullish setups from various sectors. We'll take a quick look at breakouts and reversals even in this feisty market, which is smiling upon the bulls this morning.
For the small, regional bank trader Towne Bank (TOWN) is breaking out from a consolidation wedge within a much wider and longer bullish channel. Support here is $18.50 with an upside target of $20. Not a huge mover, but with a bullish MACD crossover here and the stock now above its 10-day simple moving average (SMA) all signs point to the bulls. We already see the Relative Strength Index (RSI), Ultimate Oscillator and Force Index in bullish territory. It hits all the bullish aspects from trend to momentum to volume to volatility to price.
HollyFrontier (HFC) sets up as a possible gap fill if we see a trigger on the price breakout today. The stock has been trading in a wide channel for the last month but will likely trigger a buy this morning with price pushing past resistance and the Ultimate Oscillator passing over 50. The RSI and MACD crossed over bullish yesterday, so we have all the necessary ingredients for a run higher to $51. Any close under $48 puts us back into neutral gear.
HFC isn't the only reversal idea here. Freshpet (FRPT) is trying to put around a turn. This one has been halved in the past two month, but now has a V bounce formation playing out. The MACD crossed over in bullish fashion yesterday and we have the Force Index and Ultimate Oscillator potentially crossing today. While the RSI is still bearish, we have emerged from oversold territory, which often creates a nice bounce play. The stock is above the 10-day SMA and doesn't have much resistance until $12, although I'm looking for a push all the way to $13. The stop is a close under $10.50 for most, although very aggressive traders could use $10, but I would use a smaller-sized position if that were my thesis. Under $10 and this is a short, but over $13 should set up for a recovery all the way to $16 over the next six to eight months.
If I'm most hesitant about one of these five, it's Murphy USA (MUSA). A push over $57 and the stock should be clear to run to $60 with minor bumps at $59. I am a little concerned about the two resistance lines so close together and the MACD a little long in the tooth. Still, there is something to be said for strength and, from a technical aspect, this stock checks all the marks a bull could want. I'd mark a close under $55 as a big yellow flag and a close under $54 as a stop.
Last up is Central Garden & Pet (CENT), which is one of the strongest charts in the group. We started with a very bullish chart and we'll end with one, too. This stock has been riding its 10-day SMA since the beginning of August. That's been a great stop to use. CENT is looking to extend from the current consolidation here and make a run to $17.50. Again, this checks all the boxes from trend to momentum to price to volume in terms of bullishness. A very heavy volume day from Sept. 18 has messed with the Force Index here a bit, but not enough to see this chart as any less bullish. I would use $15.40 as a stop looking for a move to $17.50 to take profits and let the rest run using the 10-day SMA as my stop.
It's a lot to chew on this morning, but there's always the weekend to review. Be careful and mind these gaps. I'd prefer to give the early morning a little time to play out before chasing either direction. The gaps have made the early morning going a bit treacherous and it is a Friday, so be cautious with the sizing of trades.
