Don’t Fight The Tape
On Wednesday, the Nasdaq opened firmer but immediately
began to sell off. Then it rallied, sold off, drifted, spiked higher, spiked
lower and finally spiked higher. Was there some sort of news today? This action
has it closing well and at multi-month highs.
The S&P also managed to close at multi-month highs after
jerking around.
So what do we do? The positive action in the indices is
confirmed by positive action in many sectors. Software, telecom, semis, computer
hardware, major drugs and Internet (to name a few) are all at multi-month highs. Further, most
of these sectors are in persistent uptrends from lows. The only rub is that the market
is overbought and that we could have a delayed reaction to the 1/2 point rate cut (I heard
“Japan” uttered a few times today). Therefore, don’t fight the
tape but honor/trail your stops and take partial profits along the way.
Looking to potential setups, telecom is one of the sectors
that is in a persistent uptrend from lows.
Considering the above, Inter-Tel
(
INTL |
Quote |
Chart |
News |
PowerRating), mentioned
recently (a), is once again set up, this time as a Trend Knockout (b).
Other
On Saturday November 9th, I will be speaking at the Cornerstone Investors & Traders Conference
in Tampa, Florida. There is a $25 per person fee (donation ) that will go
to charity. Email me for more information or register by calling Cornerstone
directly at 1-877-536-2422. Hope to see you there!
Best of luck with
your trading on Thursday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
“…A long overdue note to let you know I am re-reading your book for the third
time. I have a library full, but I keep returning to yours, because ultimately its the clarity and relative simplicity that appeals to
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simple, but sound strategy in an accurate, disciplined way than to stuff my head with hundreds of different
strategies. These strategies might all have merit, but it causes information
overload, and just muddies the water for me; …. anyway, thanks a lot, keep up the good
column….”
Richard L.
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