Chart of the day: IBB

Today's stock chart of the day is Biotechnology ETF IBB. The pulled back hard taking a number of hot biotech stocks down with it.

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The fact that IBB pulled back hard is a concern for the market since it has been leading the market.

However, the stock is sitting right at they key 50 day moving average level. This could lead to a small reflex bounce even if it does break the support level and start a downtrend. An entry here offers an easily manageable trade with low risk, high reward.

If taking a stab here, make sure to manage risk with a stop under the moving average and a target that gives you a 2:1 reward to risk ratio.

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Chart of the day: ULTA and the post breakout trading range

One of my favorite trades is playing the post earnings breakout range that develops within stocks that have had a strong earnings catalyst the previous two weeks to 2 months.

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Ulta is a good example and has formed a $148 to $155 range. Buy the bottom, sell the top. It doesn't get much easier than that. I will look to enter on a pullback as close to $148 as possible.

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Chart of the day is EA: Keep it simple stupid!

Sometimes swing trading is easier than we make it. In the trading game it literally pays to keep it simple.

Our stock of the day, EA is a great example of the KISS method. When do you buy EA?

That's easy. When it pulls back to the 50 dma or when stochastics near oversold levels. It's a slam dunk trade that would have given us 7 profitable trades over the past year.

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For entry I will wait for a slight pullback from this level to attempt to get better value.

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Chart of the day: DIG

Today's swing trade stock chart of the day is DIG.  Energy is showing positive money flow and the sector has broke out over the 50 day moving average. Here we can place a stop under the moving average with a target at the recent February pivot high at $57.

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I will wait for a slight pullback from this level to attempt to get better value, though this is risky as the stock could move from here.

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Chart of the day: HD

Today's swing trade stock chart of the day is HD (Home Depot). In the Trade Report we have been watching residential real estate stocks for a few weeks now and of course, building material and home improvement stocks move in line with real estate.

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Home Depot broke out on strong volume in mid February and has now pulled back to the 50 dma. An entry here in the $112-114 range provides great reward to risk if stop is placed under the moving average with a target at the range high $118 or even a breakout to new highs.

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Chart of the day: MNST

MNST broke out on heavy volume a few weeks ago and has been forming a nice post breakout base ever since. This consolidation sets it up for a leg higher and a "trading the post breakout range" setup. Look to enter either 1) on pullback to bottom of the range or 2) breakout of the top of the range.

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Chart of the day: VA

One of my favorite swing trade setups is the breakout-pullback setup.  Recent IPO Virgin America broke out over it's 5 week range and has now pulled back to the old high.  This high converges with the new 20 day moving average, offering two levels of support.  Entry in the $38-40 range, with a stop under that range offers a low risk, high reward setup.

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Chart of the Day: SIG

One of my favorite swing trade setups is the breakout-pullback setup.  While the market has pulled back, retail jeweler $SIG has held up well, pulling back to the key 50 dma level.  An entry here with a stop under the 50 dma and target near recent highs around $133 offers a nice 3:1 reward to risk ratio.  This is the type of risk ratio that successful swing traders salivate over.

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Stock chart of the day: GPRO

Swing traders should always track open gaps when looking for good entry levels for a momentum stock.  The old adage that all gaps eventually get filled may not be 100 percent accurate, but it does give the swing trader an edge.

GPRO has been on fire of late.  On Monday I noted to Trade Report member that the high volume doji candle that printed signaled that the stock was extended and ready for a pullback, and that's exactly what has happened.  So how do we play this?

As noted in the weekend video analysis of GPRO, there is an open gap in the $73-74 range that converges with both the 20 day moving average and the top of the most recent consolidation range.  This is the level I will start looking to enter.  If I get stopped out here, the next level would be at the pivot level before that around $50.  As swing traders we are always looking of the strongest areas of support for entry.