Believe What You See
Even given that
the overall market trend is down, it is hard not to notice that some stocks
are showing signs of unusual strength. This may result in nothing more than a
rally within a bear market. But as traders, you often have to look for
opportunities in both directions.
Bed Bath &
Beyond has exploded off its lows and congested within the Fib retracement
levels of 61.8% and 38.2%. Volume on surge days spiked, suggesting fuel for
follow-through higher. At present, BBBY hovers between the resistance at
the level of its late-August breakdown and its 50% retracement level. It is hard to imagine a break above this range, but the technicals are implying that it could happen. Traders often have to play out a wide range of “what if” scenarios in their heads ranging from the obvious to the proposterous. But when you think about how many events in the past two years would rank in the preposterous category, it stretches the boundaries of what you can imagine.