Charts of the Day

These charts are as of yesterday's close, and my first chart is of the S&P 500 Index (SPX). Yesterday's rally was very constructive. The price action vaulted the index back above its 50-day average, and volume rose nicely, making for a second straight accumultion day.

If you look at the chart below, you can see the building reverse head & shoulders formation. The left side of the shoulder is the January lows, the head is the March lows, and the right side of the shoulder is the recent pullback in April.

The completion of this formation would require the index to continue to rally above the 1385 level. This would be very bullish, and likely lead to further upside. I don't expect this to occur without hiccups along the way, but it is certainly worth noting.

I'm sure you have heard about all of these agribusiness stocks, and how well they have been doing lately. The ETF below (MOO) is the ag ETF, which contains all of these leading stocks. You can see how it has spiked higher, and yesterday was a big breakout. The fundamentals continue to look strong for this group, but I would be more comfortable waiting for a pullback as opposed to chasing this strength.

As for individual stocks, my Stock of the Day yesterday was Quanta Services (PWR). The stock had a big spike on a surge in volume, always a good sign. This company is involved with upgrading power grids, transmission lines, etc. I think it is in a very good position, and will likely continue to benefit as the Presidential debates heat up and we hear more about the need to upgrade out infrastructure here in the U.S.

long MOO, PWR