Batteries Recharged

August 19, 2002
Dave Floyd

The only thing we can
hope for is that Friday’s sluggish price action has passed us by. I
traded the first hour, realized it was simply horrible, and given that it was
Friday in August, options expiration, proceeded to catch up on the PGA scores on
TNT. Lazy, giving up? Hardly. Simply recognizing that staring at the screen
waiting for something to happen was a waste of time. Checking out for the
weekend and recharging the batteries is what you need to do so that you are
ready for Monday morning.

So here we are. Short-term, the futures (S&Ps
and Nasdaq) are overbought. Naturally overbought can be become more overbought,
but be aware of it. A failure at the 935-36 level may offer some nice intraday
volatility, support is seen at 921. The SOX will offer some early clues as to
the direction of the futures as it appears that tech stocks are once again in
favor. Based on the hourly chart of the SOX, it does appear poised for a
pullback, but it does not appear as though it will be dramatic. I will be
keeping an eye on the following levels in the SOX — 343, 337 and 331 — as
potential support, and as a result, potential entry points on the Semiconductor
Holders
(
SMH |
Quote |
Chart |
News |
PowerRating), as well as “pivot” points for the
futures.

The following are some intraday setups that I see
offering nice potential. Naturally, you want the overall market at your back
with a protective trailing stop. These are not HVT
trades and are based on analysis of 15-minute and hourly charts.

Longs:

(
F |
Quote |
Chart |
News |
PowerRating)

(
SYMC |
Quote |
Chart |
News |
PowerRating)

(
AXP |
Quote |
Chart |
News |
PowerRating)

Shorts:

(
CAT |
Quote |
Chart |
News |
PowerRating)

Keep an eye on the LEI report at 10:00 AM EST,
consensus is for a showing of -0.5. Any big deviation will offer some real nice
volatility spikes.

Key Technical
Numbers (futures):