Saved By The Trend
It’s time for our weekly look at the Nasdaq Composite. Things
aren’t pretty. We just bounced off the 50% retracement level from the recent
lows to the recent highs. Since hitting this key retracement percentage, the
futures have been moving higher.
At this point I would like to see some of the great contrarian
indicators peak, like the number of new 52-week lows in the market, for example.
We don’t seem to see enough fear in the market. Bullish sentiment, based on the
Investor Intelligence survey, remains high. I would like to see a period of
extreme bearishness, which should in turn be followed by extreme bullishness.
As I write this, the Nasdaq futures are hitting 3601.50.
Many stocks today are hitting trendlines that began back in
April.
Today’s Watchlist:Â
(
TFSM |
Quote |
Chart |
News |
PowerRating),
(
SSTI |
Quote |
Chart |
News |
PowerRating),
(
FLSH |
Quote |
Chart |
News |
PowerRating)
Speaking of new lows, 24/7
Media
(
TFSM |
Quote |
Chart |
News |
PowerRating) hit a new one just yesterday. On Friday I was looking for
another leg down, but have yet to see it. Watch for a move below the intraday
low from Thursday to offer a potential short opportunity. The intraday
pullback from lows that has already occurred took the stock back to the breakdown
level. It couldn’t hurt to look for daytrading opportunities based on a break
back to the upside.
Silicon Storage
(
SSTI |
Quote |
Chart |
News |
PowerRating) tested both its 200-day MA and
support that was formed from February’s breakout. In this market I’m changing my
strategy. I’m watching for both bounces and breakouts/breakdowns to provide
trading opportunities. Set your alerts below the key level that I highlighted
below and below the 200-day MA. If you’re looking to play a reversal, remember
that there is a lot of minor resistance overhead.
M-Systems Flash Pioneer Group
(
FLSH |
Quote |
Chart |
News |
PowerRating) bounced off a trendline which started
back in April. We’ll watch for both a breakdown below the trendline, which may
provide a shorting opportunity, and a breakout back above the key resistance
level highlighted below. No matter which scenario plays out, remember that
follow through has been weak, so lock in profits quickly.
Last on the list is CacheFlow
(
CFLO |
Quote |
Chart |
News |
PowerRating) which has retraced to the same trendline
that we’ve seen others hit today. Watch for the same type of bounce and
breakdown relative to this trendline. In this case, you’ll want to watch the
close to see where it ends relative to the 50-day MA. Volume today is quite
light. Look for resistance near 66, which is also Friday’s intraday high.Â
Ciao,Â
Check back on Monday
for more exciting tech action.