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New Year Bullish Crosses

Jan. 03, 2011 8:16 PM ETEA, NYCB, MDLZ, MRK, PFE, PG, TWX
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

The market got off to a technical bang for 2011, booking one of the best first days of the year since the 1980s.  This, of course, will have no implications for the market outside of the next few weeks or so.  But for the time being, our models continue to suggest that the first few weeks of the year should swing stocks higher. 

That in mind, it’s best to keep an eye on stocks that are transitioning into strengthening technical patters since these stocks will likely gain momentum as their charts continue to improve.  For this, we monitor what we refer to as the “Silver Cross” stocks.  Technicians call it a “Golden Cross” when a stock’s 50-day moving average crosses above its 200-day moving average.   We consider it a “Silver Cross” when a stock’s 20-day moving average moves above its 50-day trendline.  Monitoring these faster-moving 20-day and 50-day crosses can provide opportunities for those looking to trade with shorter-term investment outlooks. 

The table displays a short list of stocks that have recently seen a “Silver Cross,” indicating that the short- to intermediate-term outlook is likely to include upside acceleration in the price move.  We like these stocks for their potential to outpace the market over the next few weeks, providing an opportunity to generate some “Alpha” for our portfolio.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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