{"id":7706,"date":"2020-09-22T12:36:45","date_gmt":"2020-09-22T16:36:45","guid":{"rendered":"https:\/\/morpheustrading.com\/blog\/?p=7706"},"modified":"2022-04-06T15:04:55","modified_gmt":"2022-04-06T19:04:55","slug":"sept-2020-recovery","status":"publish","type":"post","link":"https:\/\/morpheustrading.com\/blog\/sept-2020-recovery\/","title":{"rendered":"Why Stocks are Now Starting to Get Back on Track"},"content":{"rendered":"\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"683\" src=\"https:\/\/new.morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/stocks-on-track-1024x683.jpg\" alt=\"Stocks on track\" class=\"wp-image-7724\" title=\"\" srcset=\"https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/stocks-on-track-1024x683.jpg 1024w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/stocks-on-track-110x73.jpg 110w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/stocks-on-track-300x200.jpg 300w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/stocks-on-track-768x512.jpg 768w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure><\/div>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">TABLE OF CONTENTS<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/morpheustrading.com\/blog\/sept-2020-recovery\/#The_September_sell-off_that_has_gripped_stocks_has_begun_showing_encouraging_signs_of_improvement_Here_is_our_%E2%80%9Cno_nonsense%E2%80%9D_technical_analysis_of_the_current_market_as_well_as_a_few_top_stocks_to_put_on_your_watchlist\" >The September sell-off that has gripped stocks has begun showing encouraging signs of improvement. Here is our &#8220;no nonsense&#8221; technical analysis of the current market, as well as a few top stocks to put on your watchlist.<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/morpheustrading.com\/blog\/sept-2020-recovery\/#Watch_for_emerging_leadership_stocks\" >Watch for emerging leadership stocks<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/morpheustrading.com\/blog\/sept-2020-recovery\/#Fastly_FSLY\" >Fastly [$FSLY]<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/morpheustrading.com\/blog\/sept-2020-recovery\/#Datadog_DDOG\" >Datadog [$DDOG]<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/morpheustrading.com\/blog\/sept-2020-recovery\/#Square_SQ\" >Square [$SQ]<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/morpheustrading.com\/blog\/sept-2020-recovery\/#Invitae_NVTA\" >Invitae [$NVTA]<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/morpheustrading.com\/blog\/sept-2020-recovery\/#Plan_the_trade_trade_the_plan\" >Plan the trade, trade the plan<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_September_sell-off_that_has_gripped_stocks_has_begun_showing_encouraging_signs_of_improvement_Here_is_our_%E2%80%9Cno_nonsense%E2%80%9D_technical_analysis_of_the_current_market_as_well_as_a_few_top_stocks_to_put_on_your_watchlist\"><\/span>The September sell-off that has gripped stocks has begun showing encouraging signs of improvement. Here is our &#8220;no nonsense&#8221; technical analysis of the current market, as well as a few top stocks to put on your watchlist.<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Yesterday&#8217;s (September 21) bullish reversal action on the daily chart of the NASDAQ Composite was an encouraging sign for bulls.<\/p>\n\n\n\n<p>During a new rally attempt after a correction, we look for the price of the NASDAQ (and S&amp;P 500) to <em>hold above the low of Day 1 for at least three more days.  <\/em><\/p>\n\n\n\n<p>On Day 4 or later of a new rally, we then look for a bullish &#8220;follow-through day&#8221; to occur.<\/p>\n\n\n\n<p>With our swing trading strategy, which is loosely based on <a rel=\"noreferrer noopener\" aria-label=\"CAN SLIM system (opens in a new tab)\" href=\"https:\/\/www.investors.com\/ibd-university\/can-slim\/\" target=\"_blank\">CAN SLIM system<\/a>, a <em>follow-through day<\/em> occurs when the NASDAQ gains at least 1.5%. <\/p>\n\n\n\n<p>If a follow-through day forms on or after Day 4, then a new &#8220;buy&#8221; signal is generated in our <a rel=\"noreferrer noopener\" href=\"https:\/\/new.morpheustrading.com\/blog\/market-timing-system\/\" target=\"_blank\">market timing system<\/a>.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"948\" height=\"653\" src=\"https:\/\/new.morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/nasdaq.png\" alt=\"\" class=\"wp-image-7708\" title=\"\" srcset=\"https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/nasdaq-110x76.png 110w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/nasdaq-300x207.png 300w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/nasdaq-768x529.png 768w\" sizes=\"auto, (max-width: 948px) 100vw, 948px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Watch_for_emerging_leadership_stocks\"><\/span>Watch for emerging leadership stocks<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>More important than the chart patterns of market indexes is the performance of leading stocks.<\/p>\n\n\n\n<p>Specifically, we look for confirmation through bullish price and volume action in leadership stocks.<\/p>\n\n\n\n<p>When a market in correction mode starts recovering, it should be accompanied by emerging leadership in top growth stocks.<\/p>\n\n\n\n<p>With the bullish action of September 21, leading stocks on our internal watchlist confirmed the strength in the NASDAQ.<\/p>\n\n\n\n<p>Below, check out the bullish price action of a few leading stocks we are monitoring for potential buy entry in the model portfolio of our <em><a rel=\"noreferrer noopener\" aria-label=\"Wagner Daily (opens in a new tab)\" href=\"https:\/\/morpheustrading.com\/services\/swing-trade-alerts\" target=\"_blank\">swing trading newsletter<\/a><\/em>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Fastly_FSLY\"><\/span>Fastly [$FSLY]<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>$FSLY is a top-ranked stock we previously traded for a <a rel=\"noreferrer noopener\" aria-label=\"+51% gain back in July (opens in a new tab)\" href=\"https:\/\/new.morpheustrading.com\/blog\/fsly-breakout\/\" target=\"_blank\">+51% gain back in July<\/a>.<\/p>\n\n\n\n<p>Fastly underwent a healthy correction after a massive bull run, but the stock is once again back on our radar after blasting back above its 50-day moving average yesterday:<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"948\" height=\"733\" src=\"https:\/\/new.morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/FSLY.png\" alt=\"\" class=\"wp-image-7710\" title=\"\" srcset=\"https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/FSLY-110x85.png 110w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/FSLY-300x232.png 300w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/FSLY-768x594.png 768w\" sizes=\"auto, (max-width: 948px) 100vw, 948px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Datadog_DDOG\"><\/span>Datadog [$DDOG]<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Another must-own leading stock for us is cloud software provider Datadog.<\/p>\n\n\n\n<p>$DDOG closed above its 50-day moving average on a pick up in volume, and may finally be ready to move higher after several weeks of <a href=\"https:\/\/new.morpheustrading.com\/blog\/best-stock-breakouts\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"constructive basing (opens in a new tab)\">constructive basing<\/a> action:<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"948\" height=\"733\" src=\"https:\/\/new.morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/DDOG.png\" alt=\"\" class=\"wp-image-7712\" title=\"\" srcset=\"https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/DDOG-110x85.png 110w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/DDOG-300x232.png 300w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/DDOG-768x594.png 768w\" sizes=\"auto, (max-width: 948px) 100vw, 948px\" \/><\/figure>\n\n\n\n<p>Note that $DDOG is listed as an &#8220;official&#8221; buy setup in today&#8217;s <em><a rel=\"noreferrer noopener\" aria-label=\"Wagner Daily (opens in a new tab)\" href=\"https:\/\/morpheustrading.com\/services\/swing-trade-alerts\" target=\"_blank\">Wagner Daily<\/a><\/em> report. <\/p>\n\n\n\n<p>Subscribing members should note our exact buy trigger, stop, and target prices in &#8220;Today&#8217;s Watchlist&#8221; section of the newsletter. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Square_SQ\"><\/span>Square [$SQ]<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>$SQ convincingly found support and bounced off its 50-day MA with a bullish engulfing candle.  <\/p>\n\n\n\n<p>An &#8220;engulfing&#8221; candle occurs the day after a down day, where the price opens below the prior down day&#8217;s close, then closes above the prior down day&#8217;s open.  <\/p>\n\n\n\n<p>On the chart below, notice how the green body of September 21 engulfed the prior day&#8217;s red body.  <\/p>\n\n\n\n<p>This reversal is a buy signal for those who don&#8217;t mind entering closer to the 50-day MA with a starter position:  <\/p>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"948\" height=\"733\" src=\"https:\/\/new.morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/SQ.png\" alt=\"\" class=\"wp-image-7714\" title=\"\" srcset=\"https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/SQ-110x85.png 110w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/SQ-300x232.png 300w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/SQ-768x594.png 768w\" sizes=\"auto, (max-width: 948px) 100vw, 948px\" \/><figcaption><br \/><\/figcaption><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Invitae_NVTA\"><\/span>Invitae [$NVTA]<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>$NVTA is a stock with great relative strength that is trading at a new high, even while the Nasdaq is in correction mode.  <\/p>\n\n\n\n<p>When a stock goes steadily higher while the broad market moves steadily lower, that&#8217;s a clear sign of impressive relative strength.<\/p>\n\n\n\n<p>A move above last week&#8217;s high could spark the next wave up:<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"948\" height=\"733\" src=\"https:\/\/new.morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/NVTA.png\" alt=\"\" class=\"wp-image-7716\" title=\"\" srcset=\"https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/NVTA-110x85.png 110w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/NVTA-300x232.png 300w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2020\/09\/NVTA-768x594.png 768w\" sizes=\"auto, (max-width: 948px) 100vw, 948px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Plan_the_trade_trade_the_plan\"><\/span>Plan the trade, trade the plan<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The September 21 price and volume action was a step in the right direction for the stock market.<\/p>\n\n\n\n<p>However, it&#8217;s too soon to get aggressive on the long side because it was only Day 1 of a new rally attempt.<\/p>\n\n\n\n<p>We still need to see more evidence that a new bull market is underway before we can load up on new positions in our model portfolio.<\/p>\n\n\n\n<p>Nevertheless, we are closely tracking emerging leadership in the best growth stocks and are ready to instantly alert <em><strong><a rel=\"noreferrer noopener\" aria-label=\"Wagner Daily (opens in a new tab)\" href=\"https:\/\/morpheustrading.com\/services\/swing-trade-alerts\" target=\"_blank\">Wagner Daily<\/a><\/strong><\/em> subscribers to new buy setups when the conditions are right.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The September sell-off that has gripped stocks has begun showing encouraging signs of improvement. Here is our &#8220;no nonsense&#8221; technical analysis of the current market, as well as a few top stocks to put on your watchlist. Yesterday&#8217;s (September 21) bullish reversal action on the daily chart of the NASDAQ Composite was an encouraging sign [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[3],"tags":[],"class_list":["post-7706","post","type-post","status-publish","format-standard","hentry","category-stock-trading-strategy"],"_links":{"self":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/7706","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/comments?post=7706"}],"version-history":[{"count":7,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/7706\/revisions"}],"predecessor-version":[{"id":11154,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/7706\/revisions\/11154"}],"wp:attachment":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/media?parent=7706"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/categories?post=7706"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/tags?post=7706"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}