Continue To Watch These Levels
Looking to the indices, on Friday, the Nasdaq chopped back
and forth. This action keeps it below its recent highs, circa 1966.
The S&P put in a similar performance but managed to
close in the plus column. This action puts it at right at new closing highs
for the year. However, it too remains below its old highs (potential
resistance).
So what do we do? The indices remain below an
inflection point. And, until they get past these old highs, I think we remain in
potential correction mode. Therefore, my commentary remains essentially the
same: On the long side, you might want to
avoid new positions (or trade at a smaller size) for now. And, if you haven’t already done so, now would be a
good time to scale out and tighten your stops on the remainder. On the short
side, continue watching for transitional setups (e.g. First Thrusts, Bow Ties,
etc…) in order to play the potential correction. For the aggressive, you might
continue to look for a contra-trend trade in the index shares.
Looking to potential setups, tonight (Friday) was one of
those nights where I found myself tooling through my charts over and over
again–looking for something worthwhile. Usually when this occurs, rather than
trying to make something happen, I find that I’m better off just managing what I
already have.
Best of luck with your trading on Monday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
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