Hello traders! Your trading partner, Andy here with another round-up of my thoughts on the current state of the stock market, and plenty of setup recommendations for your consideration. Here we are, as of December 7th, a Thursday and boy, the bar in the marketplace was a bit of a grim picture from yesterday. I thought we’d take a look at the SPY and QQQ, aka the SPDR S&P 500 ETF and PowerShares QQQ ETF respectively, yet have decided to just focus on SPY.

The SPY Update: Dark Cloud Cover

The latest SPY chart displays what technical analysts call a “dark cloud cover” – not the most promising of signs. And yet, today the market is gapping up again. It’s a typical behavior around this time of year where a “melt-up” often occurs. This is where asset prices rise dramatically due to an increase in interest from investors, rather than the underlying fundamentals. Going forward, it will be interesting to see whether the market conditions align with this conventional seasonal trend.

Trading Setups: Stocks on Radar

Moving on from the broader market commentary, let’s dive into some potential trading ideas. Below, find a few of my favorite stock picks that I have been eyeing for the last few days.

Frontdoor, Inc. (FTDR)

The first on my list is Frontdoor. Despite a minor pullback yesterday, the stock continues to demonstrate strength. The key level to monitor here is the potential triple high. A breakthrough this level could suggest further upside. For a timely heads-up, consider setting a price alert at this point.

Freshpet, Inc. (FRPT)

Freshpet paints a similar picture. A breach of its monthly high would indicate bullish momentum. To ensure you don’t miss the opportunity, I advise placing a price alert slightly below this threshold.

SPDR Gold Shares (GLD) and Elorado Gold Corp. (EGO)

For those interested in trading gold, GLD is shaping up nicely. Despite a recent pullback to the 10 period moving average, the ETF is showing a positive gap up. Particularly appealing is that GLD is around its all-time highs. Alternatively, if you prefer trading gold miners, EGO is setting a compelling picture. Falling slightly back to its 10 period MA, a surge above its two-day high might be indicative of a burgeoning bullish trend.

Toast, Inc. (TOST)

Lastly, for the bottom fishers among you, I am observing some promising relative strength in TOST. I’ve held the stock for a few days and what draws me to it is its recent price action, post earnings. It formed a base after its earnings report without crossing below the earnings low. Now, the earning low serves as a critical pivot point. Should the price break dramatically above the one-month high, it’s a go.

Signing Off

So, traders, that’s it from me. Today’s key takeaway? Keep your trades tight, and your eyes peeled for these signals we’ve discussed.

“Master your mind and money will follow – at least in the stock market.” – John C. Bogle

Until our next market deep dive, keep trading smart. Talk to you tomorrow.

Andy, signing off.