Douglas Busch

"Experience" Wanted:  This is how consumers justify spending their hard-earned capital. They want to experience things they will remember and this theme could be verified through the lens of some of the leading stock charts in the space. The daily chart below of LYV displays the thirst for music concerts and the like and notice how it started a current bull flag just after poking above the very round 100 number, that acted as resistance three times between mid-July and late August. Mixed signals on the WEEKLY and MONTHLY charts with the latter showing nice action POST breakout above the cup with handle pivot of 107.34 in September. The WEEKLY chart recorded a doji candle last week which is known to signal fatigue, just its second in the last 2.5 years (but it does have the possibility depending on Fridays CLOSE to register a bullish 3-week tight pattern). Others that fit the theme include RCL which is sporting a bull flag of its own at the very round 200 number. A break above 202 would carry a measured move to 234. The WEEKLY chart of EXPE is attempting a break above a cup base pivot of 160.15 in a base 9 months long. Notice last week was above intraweek, but could not CLOSE above, and the prior week put up a doji candle.

Righting the Ship:  When SOFI first came to the markets in late 2020 it was embraced with great fanfare. It traveled higher quickly out of the gate almost to 30 and then settled back in and as recently as May 2023 traded with a 4 handle. Its MONTHLY chart, shows this name put in a credible bottom with the bullish morning star pattern completed in January 2023 and that was successfully retested with a long bullish hammer candle in May of that year. Since those lows in late 2023, it has been making higher lows and could be poised for a turnaround. Notice it is powering higher thus far in October even after the rare September doji. On the WEEKLY chart below one can see the importance of round number theory as the weeks ending 6/16, 7/21, 8/4, 12/22, and 12/29/23 all were above 10 intraweek, but NONE were able to CLOSE above 10. It is deja vu as it climbed above that level for the first time in almost one year this week and is shying away once again. Will it have more courage this time around? I think the catalyst could be the earnings announcement on 10/29 before the open which could propel this name to breakout above the 10.59 WEEKLY double bottom trigger. If that happens this could be a very bright 2025 for the name.

"Spinning" its Wheels:  There is not a more closely watched automobile play in the world than Tesla. To call in at auto-play is probably misleading as it is really a technology company. Some find its CEO a bit controversial and it may affect the PRICE sometimes but it looks like it may be trying to put in a short-term bottom here. I say this from the candles it has been recording the last few sessions with three consecutive spinning top candles, hence the headline reference, and Wednesday registered a doji candle. After a 50-handle PRICE decline since the end of Q3, these types of candles could signal selling fatigue and a change of trend in the prevailing direction which could mean better times are ahead for the name. Option activity is bullish, and the MONTHLY chart still shows the symmetrical triangle pattern in place. Others to watch in the space include RACE which has acted well since completing a bullish island reversal on 10/8 with the gap up (after the gap down on 10/3). Trouble began at the very round 500 number with a bearish engulfing candle on 9/3, but I think one can enter here and add to with a buy stop above a double bottom pivot of 481.48.

Google It: The incessant chat about the Magnificent Seven is a bit much, but some are acting better than others. The performance chart shows the different paths they have traveled over the last 100 days, and the daily chart below of GOOG is the laggard. It is one of only two that are negative over the time period. Perhaps the lack of attention for this one has been getting as not many looking at it, but if this can break above the bullish inverse head and shoulders pivot of 167 then this could get out of the dog house. Its MONTHLY chart did record a bullish hammer candle that successfully retested a prior cup base breakout. Notice how in May and June GOOGL led the XLC, but those days are long gone as the disparity in PRICE has never been greater between the two currently in the last 6 months. The XLC is holding up thanks to the strength in top holding META. It has carved out a bull flag as it trades between the very round 500 and 600 numbers and a break and CLOSE above the latter would carry a measured move to 700. Notice too how the best breakouts tend to work right away and META has done so following the break above the cup with handle of 543.81 on 9/19.