ChartSmarter Monday Game Plan 4/10/17

Markets continued their tug of war just off all time highs as they are now for the last 6 weeks on a one up one down scenario. The Nasdaq lost .6% and the S&P 500 by .3% for the week. There is something for both the bulls and the bears with the optimistic view being the action following the 3/21 and 4/5 sessions which were both bearish engulfing candles. Follow through to the downside did not emerge and the 50 day SMAs did hold firm. The bears can point to the recent volatile price movements of the indexes after a long period of very taut trading, which could be hinting at a potential trend change. The bulls have to be given the benefit of the doubt as long as the 50 day SMAs hold up as we know trends are more likely to persist than reverse. Other unrelated price factors that see a mix of opinion would be the bullish sentiment on the AAII is 10 points below its historic levels which is good from a contrarian point of view. On the downside there does seem to be an abundance of new issues coming public. For the week energy was the best actor as the XLE rose by .7%, and the group behaved well before the overnight military action in Syria. WTI has now advanced 8 of the last 9 sessions after bullish hammer on 3/27. Looking for clues into the future direction of oil one should keep an eye on the direction of Canadian banks and if solar names are trying to convey a message perhaps one would come to the conclusion that the direction may be headed lower (remember for the group to be competitive oil prices should be elevated). A peek at FSLR shows the name on a 6 week losing streak although this week did record a spinning top candle which often indicates a change in trend. It is off 58% from recent 52 week highs and it could be just a mismanaged company so its hard to make a conclusion to the direction of crude from a group that still is also in need of subsidies and this new administration may frown upon that. As always base your investment decisions on price action and below is a possible candidate that offers decent risk/reward here. Here is the chart of RICE and how it was profiled in our Wednesday 4/5 Game Plan.