Don't Ignore This Chart!

Did Mylan's Shooting Star Candle Mark A Near-Term Top?

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We'll soon find out.  But, as a short-term trader, I'd have sold Mylan (MYL) into the close today.  A close above 40.09 on heavy volume would confirm a breakout.  Today, MYL hit 41.59 intraday, but fell all the way back to close at 40.01 as it failed to hold its breakout into the close.  Given that nearly 20 million shares changed hands - one of the heaviest volume days of 2017 - that false breakout, reversal and long tail to the upside is quite ominous.  The rising 20 day EMA looks like a short-term target to the downside:

It certainly had the prerequisite volume that I'd look for to confirm a breakout.  One bright spot is that the MACD has now been above its centerline for nearly three months and that's indicative of bullish price momentum.    A confirmed heavy volume close above 40.09 is what's needed to really get MYL rolling.

Happy trading!

Tom

Tom Bowley
About the author: is the Chief Market Strategist at EarningsBeats.com, where he provides stock market education, guidance, and trading strategies using a unique combination of technical, fundamental, and historical analysis. Tom provides EarningsBeats.com members with four portfolios (Model, Aggressive, Income, and Value), all designed to beat the benchmark S&P 500, and a revolving Watch List of hundreds of companies reporting strong quarterly earnings (must beat both revenue and EPS estimates) and exhibiting technical strength as well. These companies comprise EarningsBeats' annotated Strong Earnings ChartList (SECL), from which Tom trades exclusively. Tom writes a Daily Market Report (DMR) for members to include an executive summary, market outlook, sector/industry watch, and trading ideas. Learn More
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