Elian
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.
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Resort and Casino in Las Vegas on October 13-15, 2000.
face=”Arial, Helvetica”>For a back-to-basics look at
retracement levels, see my latest trading lesson:
Introduction To Retracements.
At
the time this is being published, the S&P Globex futures
are trading 2.30 points lower and the bond market is trading
down 1 tick.
After
a lower opening and poor choppy start, the Nasdaq grinded
higher and even went slightly green on the day. However, it
stalled out early in the afternoon and sold off for the
remainder of the day.
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There
are a few words that if hear one more time, I think I’m
going to be sick. These include “Elian Gonzalez,”
“new millennium,” “range bound,” and now
this: “summer rally.”
I can assure you that tonight’s commentary will be the last
time you hear me say the first two phrases in that list.
Unfortunately, I’m afraid I’ll have to use the other two at
least once or twice more. My apologies.
Monday’s action brings us back into the recent trading range
and makes one wonder if the summer rally remains intact. Me?
The market still looks like it has momentum, judging by the
double-digit gainers (and snap-backs) on Monday. Therefore,
the summer rally most likely remains intact. However,
chances are it won’t resume until everyone quits talking
about it. A lower opening on Tuesday, followed by a
reversal, might be just what the doctor ordered.
Although there were some decent winners here and there,
Monday’s market wasn’t an easy environment to trade in. To
quote one trader: “A screwy day. Why didn’t I just
focus on the obvious (i.e., stocks that were moving)?”
For those of us who weren’t in the “obvious”
stocks, remember: No matter what the “perfect”
traders will lead you to believe, “obvious” isn’t
always obvious until after the fact.
Looking
to potential setups, Cell Therapeutics
(
CTIC |
Quote |
Chart |
News |
PowerRating),
mentioned Friday night and on the
From Highs List, still looks like it has the potential
to resume its uptrend. Just wait for follow-through to the
upside.
IBasis
(
IBAS |
Quote |
Chart |
News |
PowerRating), also on the
From Highs List, looks poised to resume its strong
uptrend from a major bottom — which is part of a
big-picture cup-and-handle (not shown).
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Continuing
on the pullback theme, Charter Power Systems
(
CHP |
Quote |
Chart |
News |
PowerRating)
appears to have stabilized after last Thursday’s sell-off.
This suggests that its uptrend remains intact.
On
the short side, Phillips Petroleum
(
P |
Quote |
Chart |
News |
PowerRating), in the vulnerable
oil service sector
(
$OSX.X |
Quote |
Chart |
News |
PowerRating) and on the
From Lows List, has formed an inverted cup-and-handle.
Best
of luck with your trading on Tuesday!
face=”Arial, Helvetica”>Dave Landry
P.S. Reminder:
Protective stops on every trade!