Focus On These Sectors Until The Market Breaks Out
On Thursday, the Nasdaq opened firmer, dipped, and then
reversed to generally work its way higher throughout the rest of the day.
This keeps it right at its 50-day moving average. It could
be stuck in a range between 2000 and 2100.
The S&P, although not as impressive as the Nasdaq, also
managed to close higher after trading lower.
The old highs, circa 1160, remains a resistance level.
So what do we do? Thursday’s action is
“a good thing” (to quote Martha) since it gets tech off its butt and
has the S&P nearing its old highs. However, as mentioned above, the indices
remain stuck in trading range mode. Therefore, until the indices break above the
resistance levels mentioned above, I don’t think there’s any reason to get too
excited about this market. With that said, continue to focus on strong
commodity related stocks such as the energies that can trade contra to the
indices. Outside of that, stick with stronger areas such as selected retail
(e.g. department stores), gaming, insurance, and selected health services.
Looking to potential setups, Sunoco
(
SUN |
Quote |
Chart |
News |
PowerRating), mentioned
Wednesday night and in the
aforementioned strong energy sector, still looks like it ahs the potential to resume
its strong uptrend out of a pullback.
Best of luck with your trading on Friday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
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