Where To Look For Opportunities Until Conditions Improve
Looking to the indices, on Monday, the Nasdaq opened
slightly firmer but quickly reversed and began to sell off. The selling
generally continued throughout the day. This action puts it well below its 50-day moving average and
below recent lows (support).
The S&P was generally soft but managed to bounce off
its lows going into the close. So far, (unlike the Nasdaq), it still remains
constructive. The old highs, circa 1160, remains resistance
here.
So what do we do? Its disappointing that the
Nasdaq can’t get out of its own way. And, until it does, I don’t we can have a
meaningful continuation of the last bull let up. Looking to the sectors, there
are some areas that remain in uptrends such as selected areas of health services, leisure, financial, telecom, and
insurance. However, until the Nasdaq can get above resistance (and of course
stop sliding first!), I see no reason to get excited about this market (in
either technology or non-technology related stocks). Therefore, if you must
trade, nibble only while waiting for better times. Should the Nasdaq continue to
slide, we should see numerous shorts setting up in weaker areas such as computer
hardware and the semis.
^next^
Looking to potential setups, Advancepcs
(
ADVP |
Quote |
Chart |
News |
PowerRating), in the
strong health services sub-sector, looks like it has the potential to resume its
accelerating uptrend out of a pullback.
Best of luck with your trading on Tuesday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
P.P.S.
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