The second consecutive shortened trading week in a row this week means two things for smart traders: increased volatility and the potential to make bigger technical moves. But with only a couple of trading days left this week, are there big enough moves to be made right now?
Despite the fact that more-regular trading resumes on Jan. 4, as Wall Streeters return from extended vacations this week, they'll be taking cues from the market's positioning for next week's trades. That means any key technicals in place by Thursday's close will carry over to bigger momentum moves on Monday.
Every week, Stockpickr analyzes the technicals for Wall Street's highest volume stocks, and takes a look at how to trade them. Technical analysis uses a stock's price movements to determine where shares are headed in the future. Technical charts are used every day by proprietary trading floors, the street's biggest financial firms and individual investors to get an edge on the market. And according to some sources, skilled technical traders can bank gains as much as 90% of the time.
at how some of the biggest names on Wall Street are trading technically.
has been a mixed bag for traders in the last six months.
The stock was on a technical uptrend for much of that time, followed by a double top in late October and November 2009. A double top, marked by two temporary highs at the same price level, is a bearish pattern that suggests a stock is set to move lower -- and move lower Apple did, mainly between mid-November and December. But with a recent breakout in play, traders could see Apple's shares unleashed in early 2010.
Apple has seen phenomenal success this year, with the continued adoption of the iPhone -- currently making up around 30% of the smartphone market -- and increased Macintosh and iPod sales. And with rumor mills churning about a new
product launch on Jan. 26, there's a big fundamental catalyst that could send shares higher.
Shares of Apple broke out above resistance during the last two trading days, to a 52-week high. A lack of other short- or mid-term resistance levels bodes well also. If you want to make the Apple trade, pick up shares as close to the green horizontal line as possible on an up day.
Australian mining giant
has been exciting traders lately as well.
The stock is smack-dab in the middle of a technical uptrend that's been in place since late September. But with shares currently sitting in the middle of their trading channel, does taking a position in this stock make sense?
BHP Billiton is no stranger to gains, with shares of the stock up approximately 78% in 2009. That's largely been thanks to rebounding commodity prices and the company's well-positioned portfolio of businesses that have surged as economic conditions have improved.
But despite all of BHP Billiton's positives, with shares in the upper half of the trading channel, the upside potential just isn't worth it. Wait for a pullback to either the 50-day moving average or better yet the lower blue support line before considering going long on this stock.
Brazilian oil and gas company
-- better-known as Petrobras -- is another international commodity play that's been gathering investor attention.
The $209 billion company is one of the biggest trading on the
New York Stock Exchange
, and not surprisingly it gets quite a bit of attention from traders on a daily basis. So is there a play to be made on that attention going into 2010?
Not likely. Despite Petrobras' increasing production volume and strong economic conditions in Brazil, the technicals on this stock still look bearish right now. Shares had been in a sustained uptrend for some time but broke down in early December after profit-taking following a 52-week high. With a newfound resistance level at Petrobras' 50-day moving average, shares could find difficulty moving higher this week.
For the rest of this week's high-volume technical trades, including
, check out the
At the time of publication, author had no positions in stocks mentioned.
Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.