Summer Slowdown
Morning Thoughts
It looks like Cisco’s
earnings moved the market as expected. Of course, it has just gone straight up.
The Nasdaq futures set a low in the morning, up for about 30 minutes, and then
decided to retest their lows. Hopefully the market will be strong enough to keep
the techs afloat.
As for the bigger
picture, what about the volume? As we move deeper into the summer months, we’re
likely to see lighter-than-average volume. How will this affect our trading?
Many moves will be exaggerated and breakouts may not see the continuations that
they used to.Â
Today’s Watchlist:
(
PLAB |
Quote |
Chart |
News |
PowerRating),
(
CLRN |
Quote |
Chart |
News |
PowerRating),
(
AMKR |
Quote |
Chart |
News |
PowerRating)
Photronics
(
PLAB |
Quote |
Chart |
News |
PowerRating) traded lower
throughout July. On Tuesday it made a volume-backed move toward the support
level just under 20 that it established in late May. While the high-volume move
may have been a sign of capitulation, we’ll still watch it for a short
opportunity. Set your alerts near the support level that I’ve highlighted in
blue below and watch for a close below it. Although the stock is up today, the
volume has not been so strong as to give us any indications yet. Â
Deja Vu? Didn’t we just see this chart? No. This chart is of
Clarent
(
CLRN |
Quote |
Chart |
News |
PowerRating), who has clearly traced out a similar pattern to Photronics.
It tested support on Tuesday as well and held up. The high volume move on
Tuesday suggests that we could be seeing either another leg downward or a bounce
in the near future. Let’s not make any predictions, but rather ready-up for a
move. Set your alerts near 29 1/2, which was the May low. Watch for a strong
move below this level to provide a short opportunity. If the stock is able to
rally back above the July 30 low, it may try to head back to the 50-day MA.
We’ll take a look at it again, should that occur.
Amkor Technologies
(
AMKR |
Quote |
Chart |
News |
PowerRating) is hitting resistance on
Wednesday. The stock has been weak since it broke its 50-day MA several months
ago. Although it’s been trying to rally back for three days now, it still has
not broken its downtrend. Watch for two opportunities. The first is a short
opportunity based on a failed move above the trendline. The second and more
conservative play would be to wait for a move below the recent lows based on a
failed break of the trendline. Should it rally strongly, it may find resistance
near 30.
Ciao,Â
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