If You’re Looking For Shorter-Term Moves, Try This Sector

  • March 9, 2004
  • Tim Truebenbach

There’s
not a lot to be said about the current market other than to avoid it…FOR
THE TIME BEING.

image src=”https://tradingmarkets.com/media/2004/Tim/tt030904-01.gif” />

image src=”https://tradingmarkets.com/media/2004/Tim/tt030904-02.gif” />

The S&P 500 found support
at its 50-day moving average as volume came in heavier than yesterday, technically
amounting to a distribution day. Short-term, I wouldn’t be surprised to
see a rally. All day long, I constantly see bearish investors on CNBC and they
are usually wrong. I still believe we are in a correction that was needed before
we could continue on with the market’s overall uptrend. Once the averages
start to rally again I will be watching to see if they can shift the current
pattern and trade higher on heavier volume instead of lighter trade.

^next^

There have been some encouraging
action out of growth stocks to help provide evidence that we are in a good market
overall. Qualcomm
(
QCOM |
Quote |
Chart |
News |
PowerRating)
is one such example that has been wrought with accumulation. The stock has been
stair-stepping higher ever since this correction began in late-January.

image src=”https://tradingmarkets.com/media/2004/Tim/tt030904-03.gif” />

Bankrate.com

(
RATE |
Quote |
Chart |
News |
PowerRating) is another example. The stock broke out of a base on 3/5/04 and
has acted well ever since. It was also nice to see quarterly earnings’
growth rate pick up in the latest quarter to 56%.

image src=”https://tradingmarkets.com/media/2004/Tim/tt030904-04.gif” />

If you are looking for shorter-term
moves, now may be a good time to hone in on the Nasdaq
and technology after about 7 weeks of declines. For the rest of us, it is best
to wait for some accumulation to show itself in the market. It would be very
healthy to look for a strong move of at least 2% on heavier volume than the
previous day and above-average.

There are plenty of stocks
to consider once the market gets back on track. Many names will most-likely
come from groups that have been holding up during the declines. Telecom
and Wireless may be a place to
look, along with China-related
companies.

Until next time,

Tim Truebenbach

timt@tradingmarkets.com