Correct-shawn?
On Wednesday, the Nasdaq lapped lower but reversed for a
decent rally. Then, late in the day, it reversed to close poorly.
The S&P put in a somewhat similar performance.
So what do we do? The
overbought condition of the market (see last night’s commentary for a list of
these) combined with sell signals and general stalling in price suggests that we are entering a corrective phase. Therefore, you might want to look
to take partial profits and tighten stops on longs and start looking for a few
shorts.
Looking to potential setups, on the short side, Washington
Mutual
(
WM |
Quote |
Chart |
News |
PowerRating) appears to be stalling out at a resistance level (a good area to
place a protective stop) and looks poised to resume its downtrend.
Trail ’em If You Got ’em–Continued
Last night (see archive), I was showing how to trail stops
with a two-bar low on Immunex
(
IMNX |
Quote |
Chart |
News |
PowerRating) (mentioned recently). Below I have
updated the chart.
Best of luck with
your trading on Thursday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
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