When In Doubt, Sit Out
This market is simply indecisive. Up, down, left, right. There is just no
direction, daily or intraday. My best suggestion for this market is to trade
trendline bounces and continuation moves. I often talk about waiting for a
continuation move. In this market, it’s particularly important. Whether it’s
intraday or daily, I am not simply going in on the first move, I am waiting
for the next price bar to take out the intraday bar high from the breakout
bar (reverse for shorts). Watching the intraday futures charts today, I saw them
take out the morning high of 1502.75. Did I just go long on the first quarter
point breakout to 1503? No. I waited for a continuation bar. I am still waiting.
They are currently printing 1499.
If you find this a hard summer to trade, do not worry, you are not alone.
Everyone is saying the same thing. This is a time when I will break out all of
the classic trading idioms. When in doubt, sit out. Cash is king. Plan your
trades and trade your plans.Â
It’s up to you from here. The ball is in your court.
Today’s Watchlist:Â Â
(
ELN |
Quote |
Chart |
News |
PowerRating),
(
GLW |
Quote |
Chart |
News |
PowerRating),
(
SDLI |
Quote |
Chart |
News |
PowerRating),
(
CVG |
Quote |
Chart |
News |
PowerRating)
The green line on the charts is the 200-day MA and the blue line is the
50-day MA.
Speaking of breakouts, how
about that Elan
(
ELN |
Quote |
Chart |
News |
PowerRating)? After consolidating for a couple of weeks on
declining volume it broke out on news. The stock has been trading at its highs
all day, and on excellent volume. I am aware that the high volume is a result of
the news and the media, but volume is volume. Set your alerts above ELN’s
intraday high and watch for a continuation move on Friday.Â
Corning
(
GLW |
Quote |
Chart |
News |
PowerRating) continues to show awesome strength. This thing will just not
die. It just hit a new high again on Thursday after tracing out a high-level cup
with handle. Watch for a new closing on a Thursday and another leg higher
on Friday. Watch for resistance near 300. In the news, Corning just
announced a split, which will most likely help the price.
Â
SDL
(
SDLI |
Quote |
Chart |
News |
PowerRating) has traced out an
ascending triangle pattern on the daily chart. On Thursday we are seeing a move
above the top of the triangle. Unfortunately, it’s moving on light volume.
Watch for a close above 382 to 383 to set us up for a potential continuation
move on Friday. If it breaks out, watch for resistance near 390 and 400.
On the short side,
Convergys
(
CVG |
Quote |
Chart |
News |
PowerRating), in the computer networking group, broke down below near-term
and intermediate-term support in the last two days. If it closes below
Wednesday’s intraday low, watch for a continuation below Thursday’s intraday low
to provide a short opportunity. The volume has been strong in the last few days,
suggesting that this trend may last.
Until later,Â
Waiting in
the Wings: FRX
Â