The Fed is Coming
Each evening we focus on the most interesting aspects for the upcoming trading day. The comments are based on observations of the nightly updates of the Stocks/Sectors and Market Bias pages. They are provided for educational purposes only and are not intended to be direct trading advice. Also, keep in mind that these remarks are made up to 12 hours in advance of the markets opening. Therefore, overnight events may alter the outcome of these observations.
At the time this is being published, the S&P Globex Futures are trading .90 points lower and the bond market is trading up 3 ticks.
Heads up, as you probably know, the Fed is meeting tomorrow. Their decision on interest rates will likely cause extreme volatility in both the stock and bond markets. Let’s be careful out there!
Tonight we added the CVR VI, a new indicator developed by Larry Connors, to the Market Bias. For more information on the indicator, see the Connors/Boucher Stock Market and Mutual Fund Timing Course (free to members of TradingMarkets.com).
Mercury Interactive [MERQ>MERQ], on the Pullbacks List, formed a narrow range inside day today (a) and looks poised for an expansion/continuation move to the upside. Vertical Net [VERT>VERT] and Aspect Telecommunications [ASPT>ASPT], also on the Pullbacks List, are a somewhat similar patterns.
As you know, the Trading Where The Action Is List contains the most volatile stocks and is only for the most aggressive traders who are willing to assume a higher degree of risk in order to capture larger gains.
With that said, Back Web [BWEB>BWEB] may be worth watching but wait for some resumption of its uptrend (a breakout of the morning range for daytraders or for it to take out its prior 1-2 bar highs for position traders) as it closed poorly today.
For you breakout players, TicketMaster Online [TMCS>TMCS], on the Above 50-DEMA-DV list, broke out of a low level inverted head and shoulders formation today.
On the short side:
Surprises normally happen in the direction of the trend. With that said, Gilead Sciences [GILD>GILD] has formed a narrow range over the past week or so and may be poised to break lower.
Best of luck with your trading on Tuesday!
PS – Reminder: Protective stops on every trade!