Last week I discussed that the uptrend line in the chart below would likely break but the real test would be to find support at the backtest of the old downtrend line at Point A in the attached chart. I favored that latter support had a good chance to hold and a bullish indication would be the recapture of the uptrend line. That is exactly what has transpired. Given this, looking forward to the week ahead, I am favoring the long side.
The combination of the next downtrend line and the resistance level in the shaded horizontal box on the chart are important. The market has a memory for prices so please note how many times that shaded area has turned the short term trend of the market. I do think this area will be overcome however. Long candidates are AAPL, MSFT, GOOG, and one with less expensive options that I like is Las Vegas Sands (LVS). The latter closed Friday at $54.35 and if it did dip early next week I would not be afraid to step up and pick up some calls for a quick trade.