Benign


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.


The Nasdaq dipped slightly
on Thursday but recovered to close well. A very benign
day with a travel range of barely 50 points. 
The good news is
that we didn’t see much follow through to the downside from Wednesday’s well publicized
“sell on the news” sell off.

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So what do we do?
As I mentioned recently, every day at
or above the 50-day moving average, to quote Martha, is “a good
thing.”  Therefore, I remain positive on the market. I am a little
concerned about the relatively low VIX readings. It’s too early to tell,
but this may a normal shift in volatility as the market transitions from a
downtrend to an uptrend (or sideways). So, for now, I think the
best thing to do is to take it setup by setup and keep it light until we get
a clearer picture.

Homestore.com
(
HOMS |
Quote |
Chart |
News |
PowerRating)
, mentioned Wednesday night as a low level cup and
handle and weekly double bottom, sold off earlier on Thursday but reversed to
close well. This suggests that its uptrend from lows remains intact.

Meta Solv
(
MSLV |
Quote |
Chart |
News |
PowerRating)
, also mentioned Wednesday night, still looks like it
has the potential to rally out of a low level cup and handle.

Cura Gen
(
CRGN |
Quote |
Chart |
News |
PowerRating)
, on the
Explosions
List
, is a volatility situation* and looks poised to rally out of a
flag/first pullback. Just wait for follow through to the upside here as it did
close poorly on Thursday.


Although I hate the way it trades intra-day, Genentec
(
DNA |
Quote |
Chart |
News |
PowerRating)
, mentioned recently, still looks like a short heading back to its old
lows.

Best
of luck with your trading on Friday!

Dave Landry

P.S. Reminder:
Protective stops on every trade!

*The recent gap creates somewhat of a false
reading but the volatility is still low based on recent action in the flag
formation.

I
think it is certainly a “must have” for anyone interested in
successful short-term trading.”

John D.

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