No Mind Games
Don’t let all this hand wringing
over the Fed psyche you out. The market is behaving nicely with pullbacks coming
on light volume. This makes perfect sense in light of the sharp gains by techs
off the lows.
More
base builders are stepping up to the plate. Sungard Data Systems
(
SDS |
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PowerRating), one
of the few techs on my radar screen, is consolidating and forming a handle or,
as old man Jiler
called it, a “platform.”
BE
Aerospace
(
BEAV |
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PowerRating) is a bit early here, but it’s worth keeping an eye on. The
peak on April 6 at 24 1/4 could serve as a pivot if the stock pulls up beneath
it and puts in a pause or platform on low volume. Note the support along the
lows of the base.
Corinthian Colleges
(
COCO |
Quote |
Chart |
News |
PowerRating)
is acting snappy and alert as well.
If
you’re already largely or fully invested for the intermediate term, remember
that now comes the part of trading in which the psychological dimension plays a
greater role. Avoid the impulse to second guess yourself at every bout of
volatility. For
more on the psychological aspects of trading, see my lesson, The
Mindful Discipline of the Medium-Term Trader. At this stage, many
antsy traders wind up beating themselves. Â
Remember
that all stocks are
speculative. On any new trade, be sure to limit your risk by limiting your
position size and setting a protective price stop where you will sell your buy
or cover your short in case the market turns against you. For an introduction to combining price stops
with position sizing, see my lesson,
Risky Business.