Ebay-kruptcy?
Each morning this
list will contain those stocks with the potential to make a quick but tradable
move in the first hour. The information listed here is designed for the
trader who catches the early morning momentum, between the first five and 45
minutes of trading. Many stocks open each morning, run for several points and
then reverse. I will cover stocks with this potential and highlight possible
reversal points and resistance areas. These points need to be monitored closely,
as the stocks may turn quickly here. Be ready to lock in profits quickly.
Morning Outlook
Watch for a turnaround in the first 10-30
minutes of trading. Keep an eye on the stocks that gap the most in the morning.
Use the Nasdaq tracking stock (QQQ)
or futures as leading indicators.
Almost every
sector that I follow was hurting yesterday, despite several attempts to rally
intraday. The semis gave up their fight before the day ended, but they did hold
the breakout level. Of course, on an intraday basis, this does not mean much.
The banks signaled weakness right from the open, as they
plummeted to the lows of the day right off the bat.
These two indices, which you often see me referring to, are
often very good indicators of where the market is headed.
One To Watch:
(
EBAY |
Quote |
Chart |
News |
PowerRating)
A truly sad sign of the times is when an analyst, who had a buy recommendation
on a stock while it tumbled over 65%, downgrades that stock and still has
followers who sell on his tip. Who out there possibly still listens to this
person’s call on the stock? On that note, Ebay
(
EBAY |
Quote |
Chart |
News |
PowerRating) took out what
remained of its support on Monday. It basically gapped down and made two
attempts to recover. Clearly, both failed. Watch for Ebay to put in a
continuation move and trade below Monday’s intraday low. Set your alerts near 33
3/4 and watch for another breakdown.
As you can see from the five-minute chart, despite two attempts
to recover, the stock still closed on its lows.
Just to play devil’s advocate, one thing I will say is that I was
always taught that the day a mega-bullish analyst downgrades a stock is usually
the bottom.