[Premium] Trade Of The Week

The evidence is suggesting that we're shifting towards a two-way market, in which some stocks go up, some stocks go down, and a lot go nowhere as the indexes chop around.

If that's the case, we want to be shorting some of the weakest areas of the market like Bank and Financial Services stocks...bringing us to this week's setup in LIC Housing Finance.

This stock has been showing weakness relative to the Nifty Mid-Cap 100 and the Nifty Financial Services Index and is about to break down to new absolute lows. We want to be selling it short if prices are below 260, with a target back towards its March lows at 190.

Click on chart to enlarge view.

Stocks like this are exactly the type we want to be selling. They have weak absolute momentum (didn't get overbought), are below a downward-sloping 200-day moving average, are in an underperforming sector/industry, and are showing relative weakness versus their peer group.

There are several of these types of names in the Financial Services, Energy, Media sectors, among others.

For all of the stocks we want to be buying and selling, make sure to review our Trade Ideas page.

Also, make sure to check out our "Three Charts For The Week Ahead" too.

Thanks for reading and please let us know if you have any questions.

Allstarcharts Team