Is That Your Final Answer?
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Intraday Trendlines for Daytrading Part I, is also available now.
Now that both the PPI and CPI have been
released, what will people blame for selloffs? With the Nasdaq still stuck in a
trading range, we still need some catalyst to get us moving again. I was hoping
that today’s numbers would be enough, but they have not yet proven to be so. My
recommendation for the time being: Savor the moment. Take advantage of the fact
that there are rather clear support-and-resistance levels on the near-term
Nasdaq charts. A trading range provides numerous opportunities to take small
gains with each bounce.
Today’s Updates:Â
(
MENT |
Quote |
Chart |
News |
PowerRating)
Mentor Graphics
(
MENT |
Quote |
Chart |
News |
PowerRating),
mentioned in Monday’s Trading
the Techs PM, moved exactly as we were hoping. After we saw it moving into a pennant
formation, we searched for a trend to help give it some direction. Yesterday the
stock broke through the top of the pennant and triggered our alert. While
daytraders may have taken advantage of this short-term move, swing traders will
note the continuation from the break of Tuesday’s intraday high. Note the dip in
volume during the consolidation, followed by a volume-backed breakout.
Â
Today’s Watchlist:Â
(
ABSC |
Quote |
Chart |
News |
PowerRating),
(
NT |
Quote |
Chart |
News |
PowerRating),
(
ARTG |
Quote |
Chart |
News |
PowerRating),
(
CMGI |
Quote |
Chart |
News |
PowerRating)
Aurora Bioscience
(
ABSC |
Quote |
Chart |
News |
PowerRating)
has come off its lows with a fury for the last few trading sessions. It’s
currently consolidating and moving into a pennant formation near its recent
highs. Since the pennant formation has been our most successful pattern in
Trading the Techs, we’ll have to add it to our list. Like we did with Mentor
Graphics
(
MENT |
Quote |
Chart |
News |
PowerRating), we will watch for a continuation of the current trend,
signaled by a breakout above the top side of the pennant. Aggressive traders may
catch the initial breakout, while the conservative player will wait for a move
above the high of the flagpole.
Â
Nortel Networks
(
NT |
Quote |
Chart |
News |
PowerRating), our two-letter
stock du jour, has formed a low-level cup-with-handle pattern on the daily
charts. On Wednesday we see the first stage of a breakout. Remember what to look
for? Watch for strong volume today as well as a continuation on Thursday (which
should take out Wednesday’s intraday high). The telecom sector remains popular
over the longer-term, so it’s always good to have several of its members on your
watchlist each day.
Art Technology Group
(
ARTG |
Quote |
Chart |
News |
PowerRating)
first appeared on the Watchlist when it was moving into the infamous pennant
formation. After successfully breaking out for more than 10 points, it has
entered a consolidation pattern. On Wednesday, it broke out from its eight-day
consolidation, which was great for daytraders. On the other hand, swing traders
should still be watching for a move above the next resistance level, which is
still several points away. Set your alerts near 78 as we await our move.
CMGI
(
CMGI |
Quote |
Chart |
News |
PowerRating) has been
in a trading range for the past eight days, along with the broader market.
Because the 50-day MA is swiftly approaching, we may see a move in the near
future. Set your alerts at 63 1/2 and 54 1/2. We’ll stick with the usual system
and watch for a closing move outside of the trading range, followed by a
continuation the next day. Remember to use breaks of the intraday highs
and lows as your trigger (confirmation).
Â
Until
later,
Waiting in the Wings:
CMVT – Comverse Tech
Check back at 2:00 PM ET
for Trading the Techs PM.