Boston Scientific

Last up is medical device maker Boston Scientific ( BSX). In short, BSX looks "toppy" right now, thanks to a head and shoulders pattern that's taken shape in shares.

The head and shoulders is a topping pattern that's formed by two swing highs that top out at approximately the same level (shoulders), separated by a higher high between them (the head). The sell signal comes on a breakout above the neckline, which is right at $9 for BSX. Momentum, measured by 14-day RSI, adds some extra downside confidence to this trade; it's been in a downtrend of its own since the pattern started forming.

>>5 Stocks the Pros Love This Summer

Lest you think that the head and shoulders is too well-known to be worth trading, the research suggests otherwise. A recent academic study conducted by the Federal Reserve Board of New York found that the results of 10,000 computer-simulated head-and-shoulders trades resulted in "profits that would have been both statistically and economically significant." If you own BSX right now, I'd recommend taking gains if $9 gets taken out.

To see this week's trades in action, check out this week's Must-See Charts portfolio on Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.


Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

Follow Jonas on Twitter @JonasElmerraji

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