When In Doubt, Sit Out
Weekly
Check Up
So how much
progress has the Nasdaq made since we last looked at it? Not much.
We’ve seen several ups and downs and are now coming off the lows
of the week. We are below both the 5-day and 20-day MAs. The
action that we saw earlier in the week may have been nothing more
than a bearish flag, but we can’t be sure until the lows of the
flag serve as resistance.
On Monday, we’ll
go over our first-hour trades. Take the weekend to compare the
results of your trades in the first hour of each session for the
last week and see how the results differ from your other trades.
Try to determine which patterns worked the best in the first hour.
Regarding the recent market
weakness, I know that we have not seen too many strong patterns.
This leads to a lot of uncertainty in the markets. How do we
solve this problem in our own trading? Just remember this, “When
in doubt, sit out.”
Today’s PM
Watchlist:face=”Arial”>
(
HGSI |
Quote |
Chart |
News |
PowerRating),
(
JNPR |
Quote |
Chart |
News |
PowerRating),
(
RMBS |
Quote |
Chart |
News |
PowerRating),
(
MMCN |
Quote |
Chart |
News |
PowerRating)
There will be no
charts in today’s column, but they will return again on Monday.
Humane Genome
(
HGSI |
Quote |
Chart |
News |
PowerRating)
traded down for the last two days and put in another low on
Friday. It’s now reversed and trading near its day high, just
under the 20-day MA. Watch for a move back above the intraday
high from Thursday to provide a potential opportunity. If it
heads higher, there may be resistance at 150 and just over 153.
The biotechs remain the talk of the town, so look for the
volatility to continue.
Juniper Networks
(
JNPR |
Quote |
Chart |
News |
PowerRating)
is interesting because despite its trading lower intraday for the
last two days, it continues to recover and trade near its highs.
Set your alerts near 170, which is acting as resistance. A move
over this level may give it some upside potential until it
reaches 177, the next resistance area. If the momentum is strong,
we could see a high-level cup formation.
Rambus
(
RMBS |
Quote |
Chart |
News |
PowerRating) has been
consolidating for the last three weeks. The stock dipped outside
of the range but found support at the same level as that of
another false breakdown. At this point, we’ll simply watch for a
move outside of the range, to either the upside or the downside.
The stock is stuck between roughly 62 1/4 and 77. Watch for a
volume-backed move outside of the range. Swing traders should
watch for a close outside of this consolidation area and then
another move in the same direction on the following day. Rambus is
more than 50% off its highs.
MMC Networks
(
MMCN |
Quote |
Chart |
News |
PowerRating) is not
far off its highs, less than 4 points. Let’s set our alerts near
61 as we watch for the chart to trace out a cup pattern. MMC took
a huge dip in late-July and August. It’s currently up 3 5/8 or 6.72%.
Indicator readers may notice that the MACD lines and histogram
are also crossing to the upside. As well, the 5-day MA just
crossed above the 20-day MA. I remind everyone again that we have
seen numerous false breakouts in the last few months, so don’t
just go long and close your eyes. If you decide to take a
postion, use a protective stop and remember to trail it on the
way up.
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