Week of 2020-12-27 Watchlist: $DKS, $DBX, $FUV, $HBI, $KALA, $ZNGA
New Add: $DHI, $SESN
Previous Watchlist Entries
Today was one of those days. After the day started on the upside, the market decided to take a break from its upswing, with $ADD ending the day at -1108.
With that said, after the initial drop, as I wanted to be sure that things were going to stabilize some, I put in limit orders just under the support lines that I had previously mentioned for three of the tickers above: $DBX, $DKS, and $HBI. However, each of these continued to show some strength and didn’t challenge the support to give me a great entry. I will likely look to get into one or more of these tomorrow.
$KALA didn’t keep support at $7.29 and continued to fall below its 23.6 retracement at 6.83.
$FUV fell through its 61.8 extension (15) and its 38.2 retracement (14.32) and bounced off the 23.6 retracement (12.96). It spent most of today in a channel between these two retracements.
$ZNGA also fell through strong support and ended up bouncing against a 78.6 retracement at 9.48 up to its daily VWAP, which it held for the las couple of hours.
New Watchlist Adds
DHI
$DHI looks to be gaining energy for a possible continuation of its upward trend for much of the year.
The first daily chart shows the path upward after the initial fall in March. For those who are interested in Fibonacci lines, you will note that along the way, the key fib extension lines were where it paused to regain energy before moving upward. Though the extension was drawn after the full run-up to date was completed, it shows how fibs can be used to predict where something may pause along the way, in either direction.
The second daily chart adds in the fib retracement right after it hit its peak and pulled back. Since then, it has been making a narrower and narrower channel. This is often a sign that it is gaining energy to continue the momentum trend it was on (meaning up).
I added a third daily chart to help illustrate something else. In this case, I added an additional fib extension just for the first leg of its long run-up. In this, you can see where the two sets of extensions provide for key lines: 161.8 and 38.2 are together; 61.8 and 261.8 are together; and the 100.0 and 423.6 are together. Each of those lines provided for key areas of resistance on the ride up before moving up higher. Use of this set of tools can help you chart the path of stock as it moves in one direction or the other.
SESN
SESN is a bio tech play. This is a penny stock that also has options. On December 21, 2020, it announced that it had submitted an application to the FDA to sell a bladder cancer treatment. However, with that, the price plummeted from around its 52 week high.
The daily chart shows to the 100.0% extension from its July run-up, and its chart action from there to the present. It tested the 161.8 twice, fell back to its 61.8 before bouncing back up to the 100.0, and from there, ran through the 161.8. However, the market did not seem to like the news on the 21st and it fell down through the 100.0 for a day, and came back up to it.
The hourly chart shows the recent retracement. It spent parts of two hours below the 100.0 ext before settling into a channel between it and the 23.6 retracement.
The FDA decision is required within the next 60 days. It will also be submitting an application for the same treatment in Europe in early January. This provides for a catalyst sometime in February.