While the broad market is ending the day with a bullish bang, we've actually found a couple of bearish idea to be among the better trading setups. Here's a closer look at Standard Pacific Corp. (NYSE:SPF), The Phoenix Companies, Inc. (NYSE:PNX), and Himax Technologies, Inc. (NASDAQ:HIMX).
Himax Technologies, Inc. (NASDAQ:HIMX) caught my attention today not because I think it's going to move higher from current levels, but because of the hint it dropped... a very rare two-bar pattern.
Ever heard of a long body or marubozu bullish reversal? That's what Himax Technologies is making today. It consists of a tall bar on the first, with an open and close at the high and low, respectively, followed by an equally tall bar on the second day, with an open at the low and close at the high. The tow bars should basically be (1) tall, (2) be of equal highs and lows, and (3) be a mirror image of one another. HIMX qualifies on all three fronts.
I might have been bullish on Himax Technologies anyway, but after seeing this quality marubozu candlestick pattern, I had to share it (and the why) with you.
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If the recently-developed pattern holds up,
Standard Pacific Corp. (NYSE:SPF) is on its way down.
Since August, Standard Pacific shares have traced a falling resistance line that was largely the reason for the peak and rollover from the middle of this week. However, all throughout this downtrend from SPF we've seen weak buying volume on the up days, and strong selling volume on the down days...painting a bigger, bearish picture.
There's a slim possibility that Standard Pacific Corp. could find support (again) at $3.16. But, considering it's already been broken once as a floor - even if not permanently - I expect the string of lower highs and lower lows from SPF to persist until we get back to the lower $2.00 area.
And finally, I wanted to point out an interesting pattern from the chart of
The Phoenix Companies, Inc. (NYSE:PNX) before it was too late to do anything about it.
Check out support at $2.93. The Phoenix Companies shares have been pressing their luck with that level for several days now, and not for the first time. That's not the only interesting thing I see for PNX though. If you look closer, you should also be able to see a head and shoulders pattern, with $2.936 as the neckline.
There's nothing you really need to do with The Phoenix Companies yet, since the neckline hasn't been broken. If it does though, you should know that head and shoulders patterns have a pretty high success rate. This one should carry PNX down to the $1.50-ish area, which was a support level in July and August anyway.
If you'd like to know of any changes in our opinion of SPF, HIMX, or PNX (or if we officially recommend them as trades), be sure to sign up for our free newsletter today. It's delivered weekly.
