Stocks primarily moved higher on Friday and three of the four main indices were up as a result. The Russell fell 0.76% and was the lone decliner of the four.
The Dow led the indices with a gain of 0.69% and it was followed by the Nasdaq with a gain of 0.42%. The S&P moved up 0.34% on the day.
On the sector front, six moved higher on Friday while four moved lower.The top performer on the day was the tech sector with a gain of 1.27%, but it was the only one that gained more than 1.0%.
Consumer discretionary stocks moved up 0.52% as the second best sector.
The energy sector made it four straight days where it was the worst performing sector, falling 0.63%.
The materials sector dropped 0.58% as the second worst performer.
My scans were a little less negative on Friday with 11 bullish signals and 18 bearish signals.
The barometer moved up a little, coming in at -23.5 after a reading of -31.7 on Thursday.
After three straight bearish trade ideas, I have a bullish one for you today. Chip maker Xilinx (Nasdaq: XLNX) appeared on the bullish list Friday night and the company gets good fundamental scores. The EPS rating is at 67 and the SMR grade is a B.
We see on the daily chart that the stock has formed an upwardly sloped trend channel off of the March low. The stock just hit the lower rail and the 50-day moving average is right there in the same area. The stochastic indicators are at their lowest levels since March and they made a bullish crossover on Friday.
Buy to open the October 100-strike calls on XLNX at $6.75 or better. These options expire on October 16. I suggest a target gain of 100% for this trade and that means the stock will need to reach $113.50. The stock peaked at $111.76 in July, but that is what formed the upper rail. That rail will be much higher in the next few weeks. I recommend a stop at $97.50.
— Rick Pendergraft
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