Don't Ignore This Chart

Gambling Index Prints Reversing Shooting Star Candle

Over the past six months, the Dow Jones U.S. Gambling Index ($DJUSCA) has gained 27.35% to lead all consumer discretionary groups.  In fact, renewable energy ($DWCREE) is the only industry group among all sectors to outperform gambling stocks.  But the short-term outlook for gamble stocks changed on Thursday with a potential reversing candle printing.  Take a look:

Momentum has been very strong so I'm not looking for a significant long-term top.  However, any time a stock or index makes a new high intraday on increasing volume, and fails to hold it into the close, I'd look for at least a short-term pullback.  The rising 20 day EMA, currently at 851, would be a key support level to watch.  As a short-term trader, I'd consider taking profits on gambling stocks in the near-term and look to re-enter on weakness over the next couple weeks.

Happy trading!

Tom

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