Daily Breakouts Are Ramping Up

I'm seeing key breakouts across many different sectors, industry groups, and stocks.\

Those companies seeing their stock prices rise to 52-week highs are mostly the leaders that we want to keep a close eye on - and potentially trade when they pull back to key price and moving average support levels. One of the strongest banks that I've seen is United Bankshares, Inc. (UBSI), which broke out to a new 52-week high on Thursday and then added another 4% on Friday. Here's the chart:

Enter United Bankshares, Inc. (UBSI):

The last pullback held the two key moving averages - the 20-day EMA and 50-day SMA. The big move higher on Thursday and Friday was accompanied by solid and increasing volume and UBSI finished on or near the highs of the day each day as well. That's sent the AD line soaring. It's hard to find something not to like about UBSI as its PPO is moving straight up as well, signaling that momentum is strengthening. I've marked two levels of price support in the 39.50-40.25 range where I'd be interested if UBSI were to see some short-term selling. In the bottom panel, you can see that banks ($DJUSBK), as a whole, are strengthening vs. the S&P 500. Finding solid momentum in a leading group is typically a successful trading strategy.

Happy Trading! Tom Bowley Chief Market Strategist EarningsBeats.com Better Timing. Better Trades.