2 Sectors That May Still Be Worth Buying
On Friday, the Nasdaq sold off throughout
the morning and then traded back and forth throughout the afternoon.
The S&P put in a similar performance.
So what do we do? A couple of days
has made a big difference. The fact that the indices broke down out of their
upward drift patterns is concerning. The sector action is also concerning.
Although there are some areas such as telecom and the semis than are hanging in
there, quite a few are breaking down. This includes retail, homebuilders, and
broker/dealer. Other areas such as biotech are stalling after bumping up
against their old highs. Considering this, on the long side, focus on those
areas in strong uptrends that can trade independently of the indices such as
metals & mining and the energies. On the short side, we could see
transitional patterns (early trend) soon in areas which have recently sold off
hard such as the homebuilders.
As far as setups, Cal Dive
(
CDIS |
Quote |
Chart |
News |
PowerRating), in the
energies, looks like it has the potential to resume its strong uptrend out of a
pullback.
.
Best of luck with your trading on
Monday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
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Ties Strategy. Click
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