At the end of every trading month I like to scan through monthly charts to gain some context about the general health of the market and to see what kind of stocks are setting up for longer term moves. It also helps me find some high probability trading ideas.
The “Sell In May” crowd will begin to dominate the headlines soon as we move into the historically turbulent summer trading months but that doesn’t mean they’ll be correct and it doesn’t mean all stocks have to follow.
Below are 5 bullish trading ideas on monthly charts selected based on their strong technicals and actionable consolidation patterns. Most of these names are still “setting up” and need further confirmation before I would be interested in jumping on board.
Without further adieu, here are 5 bullish trading ideas to watch throughout May:
1. Raytheon ($RTN)
Raytheon (RTN) has been in a long term uptrend since 2012 and for the past 5 months it’s been consolidating sideways between 120 and 130. RTN tried to breakout to new all time highs this April but ultimately failed to hold onto those highs. The pattern still looks actionable, and I’ll be keeping an eye on 130 for my all clear signal.
2. Check Point Software Technologies ($CHKP)
Check Point Software (CHKP) not ready yet, but you can see this clean sideways channel developing within this 77 to 87 range above all of the fast moving averages. Consolidation is healthy, let’s stay patient for that breakout move to new highs.
3. Medtronic ($MDT)
Medtronic (MDT) is making a breakout move to new highs this month after consolidating sideways for a year and a half within the context of a long term uptrend. MDT looks great for continuation so long as it can stay above 77.
4. United Parcel Service ($UPS)
United Parcel Service (UPS) consolidation here has been a little loose but I do like the breakout above 103 last month following the failed move in January below 90. As long as UPS can hold above 103, I like the odds for new highs to follow.
5. Bitcoin ($BTCUSD)
Bitcoin (BTCUSD) has five tight months in this ascending triangle from 360 up to 450 and this is following a strong thrust off the lows and breakout move above 300 late last year. I like the tight pattern here on bitcoin and a move above 470 to kick off the next leg higher in this newly formed uptrend. If you’ve never traded bitcoin before, check out this recent article I wrote covering its history and a more detailed look at trading levels.
Thanks for reading and have a great week.
Twitter: @EvanMedeiros
No position in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
