This Defense Stock Could Be In Trouble
On Wednesday, the Nasdaq opened weaker and continued lower
in early trading. However, it found its low by mid-morning and then rallied for
much of the remainder of the day. This action has it closing well.
1320, the blue line below, continues to hold as a support
level. Once again, if broken, the October lows look like a possible target.
The S&P put in a similar performance. It remains below
its 870
“breakdown” level. The October lows remain a likely target here, too.
So what do we do? Although they got off to a rocky
start, the indices appear to be in bounce mode. This action coincides with
recent buy signals (see archives). However, once again, don’t look to bottom
fish. Rather, use this as an opportunity to start putting together a list of
potential shorts. You might want to look to sectors that have recently rolled over, such
as utilities or those in sharp downtrends such as defense (in spite of war
jitters) and insurance. No matter what you do,
continue to keep it light since we remain in an event-driven environment.
Looking to potential setups, General Dynamics
(
GD |
Quote |
Chart |
News |
PowerRating), in
the aforementioned weak defense sector, looks poised to resume its meltdown out
of a pullback.
Housekeeping
As you may know, lately I have offered the rules to some of
the market timing systems that I follow (e.g. CVR-III Modified and Oscillator
Swing System, see recent archives). The attachments that I send out are
Microsoft PowerPoint. It appears that some of the “free” e-mail
accounts (e.g. “Hotmail” and “Yahoo!”) have rejected these
files. If you requested these files and did not receive them, please send
me an e-mail letting me know.
Best of luck with your trading on Thursday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
“….I keep pushing people to get it and read it. I like you and all, but that’s not why I do it. I really feel you’ve written an accessible, usable text that the average guy can read, learn and master with daily practice. No esoteric models or complicated formulas that require obscure and hard to get data. I know you’re hearing that a lot. But I think you’ll look back years from now and feel proud to know it’s sitting on the shelf of some very successful investors……”
Name withheld
