Silly Market, Tricks Are For Kids

June 22, 2000
Dave Baker

Make sure to register for the
upcoming course “The Baker/Ten Electronic Trading Course”, starting
July 7. Click
here to go to the registration page.

My latest trading lesson, Finding
Intraday Trendlines for Daytrading Part I, is also available now.

With earnings season upon us, be sure to note the expected announcement
date of any stock that you are thinking of opening a position in. As we’ve seen,
earnings announcements can have quite an effect on prices. In my trading
account, I try to avoid holding over an earnings announcement, as I’m not a big
speculator. How many times have you seen a great company come out with amazing
earnings and growth, only to be destroyed the next day in the market? I’ve seen
it one too many times. I rather lock in my gains (at least part of them). New
readers of the column should know that my short-term and daytrading strategies
are quite conservative.

Terayon
(
TERN |
Quote |
Chart |
News |
PowerRating) was
added to the Watchlist on Tuesday when we first started watching for a breakout.
On Wednesday, the stock did exactly what we were watching for, it broke out.
While more aggressive traders may have caught the initial move, the conservative
traders should watch it today for a continuation move. Before opening a
position, make sure to note the two upcoming resistance levels.

Silicon Storage
(
SSTI |
Quote |
Chart |
News |
PowerRating)
is showing a first continuation day after breaking out on Wednesday. In this
situation, I look for a three- to five-day move followed by a pullback, which may
later lead to a cup-with-handle formation. Watch for continued volume strength.

Netro
(
NTRO |
Quote |
Chart |
News |
PowerRating) moved above the top of the low-level cup with
handle it traced out over the last few weeks. It’s been consolidating since
breaking out on Monday. Now we’ll watch for a continuation above Monday’s intraday
high. There may be some resistance until the gap is filled from April 16. It
would be safest to wait for a move above this level. As always with any
low-level setup, note the next two resistance levels.

Adobe
(
ADBE |
Quote |
Chart |
News |
PowerRating) has tested its four times in the last two
months. We will continue to watch for a breakout. Adobe has shown a series of
higher lows, which is a positive indicator. It’s currently consolidating near
its highs, perhaps suggesting an upcoming move. As always, rather than making
any sort of predictions, we’ll wait for the breakout and continuation move.
Aggressive traders may try to catch an initial move above resistance.

Akamai
(
AKAM |
Quote |
Chart |
News |
PowerRating) moved above resistance on high volume on
Wednesday. Despite the early morning run-up on Thursday, Akamai pulled back,
leaving us waiting for our continuation. Reset your alerts 1/4 to 1/2 point
above Wednesdays’ intraday high. Look for possible trouble near the
unfilled gap area. Above this level, resistance is quite a ways off. This stock
has such a huge 52-week range that resistance points are far apart.

I’ll admit it, after seeing Exdous
(
EXDS |
Quote |
Chart |
News |
PowerRating) simply get mauled
during the Nasdaq pullback, even I thought that it might not come back. Looking
at it today, we see that it has come roughly 100% off its lows. Despite the large
intraday pullbacks, it continues to maintain its current uptrend. By looking at
the chart below, readers of my columns will immediately know why I’ve brought
Exodus to your attention today — converging trendlines. There is nothing
I like to trade more than this. With the current uptrend set to challenge the
resistance set in April, it’s time to watch for a decision. To be conservative,
let’s set our breakout alerts just over 60, at which point we’ll take another
look at Exodus.

Until this afternoon,

Dave Baker

Check back at 2:00PM ET
for Trading the Techs PM!

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Silly Market, Tricks Are For Kids

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