Invesco (IVZ Quote - Cramer on IVZ - Stock Picks) rallied to a seven-year high in December and sold off with the broad market. It bottomed out in March and shot back to 50- and 200-day moving average resistance. The stock surged above those levels in early May and reached $29, but then the move stalled once again. It's been pulling back in a slow decline since then.
Price dropped into the 200-day moving average last week and has been congesting into an ominous narrow range pattern at this level for the last four price bars. A break at $25.70 would confirm a breakdown and support an active downtrend that shows little support until the April swing lows at $22.
Belden (BDC Quote - Cramer on BDC - Stock Picks) topped out near $60 in 2007 after a multiyear uptrend. It dropped hard at that level and has been caught in a major decline for the last 11 months. The stock hit a deep low in April and bounced about six weeks later to 200-day moving average resistance, where the recovery effort failed.
Price surged below the 50-day moving average two weeks ago and has bounced back to test this new barrier. A breakdown under the eight-day low at $35.77 should issue a renewed sell signal for a virulent decline. The next support near $33 should stall but not stop the downside, which might carry price into a test of the April low near $30.28.
With a market this tumultuous, there's always a stock falling fast, but wait for the right signals before shorting. You don't want to be a victim of yet another volatile squeeze.
Alan Farley provides daily stock picks and commentary with his "Daily Swing Trade" newsletter.
Alan Farley
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