Day Three

Green up and down
the screen
on the third day of
The Pullback.

Volume, which isn’t particularly laden
with meaning on the first day up off a substantial, two-day drop, shriveled 8%
on the Naz and was 15% above par.

One mild minus was the disinterest in
most recent IPOs.

As a specialist in the intermediate
term, your job now is to detect which leaders are holding up best on days such
as Wednesday, and which are lurching forward on days such as Thursday.

For example, it is of value to know
that Siebel
(
SEBL |
Quote |
Chart |
News |
PowerRating)
acted like a champ for the entire session Thursday.

Ditto for Network Appliance
(
NTAP |
Quote |
Chart |
News |
PowerRating)
.

Moreover, Avocent [AVCT|AVCT[, Check
Point
(
CHKP |
Quote |
Chart |
News |
PowerRating)
, Human Genome
(
HGSI |
Quote |
Chart |
News |
PowerRating)
all rose on higher trade.

Conversely, Finisar
(
FNSR |
Quote |
Chart |
News |
PowerRating)
and
Gemstar
(
GMST |
Quote |
Chart |
News |
PowerRating)
both experienced distribution for the second day.

And then in the bells, EMC
(
EMC |
Quote |
Chart |
News |
PowerRating)

was accumulated for the second day, moving to a new closing high, while Nortel
(
NT |
Quote |
Chart |
News |
PowerRating)

was distributed for the second day.

This sort of information is available
to anyone with a quote machine, is free, is 100% objective, and best of all,
gives you the very latest reading on leadership.

As such, it is of value not only to
the intermediate player — the focus of this space — but also to day and swing
traders who key off intraday patterns such as the flat base, the flip-top, the
cup-with-handle, etc.

Swing traders should note that
Commerce One
(
CMRC |
Quote |
Chart |
News |
PowerRating)
is forming an eight-week, low level
cup-with-handle…the stock is under extreme accumulation, having notched 10
accumulation days versus 0 distribution days over the past five
weeks…sequential revenue growth is smoking, up 107% and 79% over the past two
quarters, respectively…volume has been far above norm for six days
running…for the intermediate player, however, the stock is too snowed under by
mounds of resistance to warrant serious consideration.

Among the names, Manugistics
(
MANU |
Quote |
Chart |
News |
PowerRating)

chipped in with its second inside day in a row, as it stood inside a five-day
triangle.

Marvell
(
MRVL |
Quote |
Chart |
News |
PowerRating)
, mentioned here
recently, bucked the disinterest in newer issues by prancing ahead 15%…this is
one for the swing trader to watch for any sign of a pullback.

Mercury Interactive
(
MERQ |
Quote |
Chart |
News |
PowerRating)
, under
extreme accumulation, closed well, putting in an inside day, and is an inch from
its six-month high.

Power One
(
PWER |
Quote |
Chart |
News |
PowerRating)
just sat there
sunning itself beneath its old high of five days ago…good.

Transwitch
(
TXCC |
Quote |
Chart |
News |
PowerRating)
stormed back on
sheets of volume, closing well on a wash-and-rinse day.

Verisign
(
VRSN |
Quote |
Chart |
News |
PowerRating)
is in a Cooper
1-2-3-4 pullback.

Sycamore
(
SCMR |
Quote |
Chart |
News |
PowerRating)
continued its
comedown on thick turnover, closing poorly.

Etcetera:
I am stepping down as editor-in-chief of TradingMarkets.com to fulfill a
long-time goal of operating a hedge fund à la my good friend Gregory Kuhn.
Larry Connors, the persuasive chap that he is, has convinced me that this space
wouldn’t be the same without my ilk. So, henceforth, I will continue to
enlighten and inform every trading day @ 4:25 p.m. ET, or thereabouts. Now
holding the editorial reins of this Web site in his very capable hands is Eddie
Kwong, previously the managing editor and the Kwong in "In Kwong We
Trust."