Full Moon Day
We
have to give thanks to
(
CSCO |
Quote |
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News |
PowerRating), but most of all to crowd
psychology — and possibly the Turk — for the excellent reversal trade
yesterday afternoon. Those of you who prepared in advance nailed it. Those of
you who are flexible and trade what is took entry. But those of you who said,
“The market looks awful, not for me,” are still scratching your heads.
The trade was a multiple
time frame convergence at key inflection points, at which you wait for a Change
in Direction pattern and then take the trade. The Nasdaq 100
(
NDX |
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PowerRating) hit the
Fib retracement of 2349 on the number, with a 2349.92 low, while the 2.0
Volatility Band was 2340. There was an early 1,2,3 close entry and then a 1,2,3
higher bottom entry. The index rose to 2432 before closing at 2405.
The futures traded like
someone was on a specific mission, but who cares because as a daytrader up is
up, and you just want to be on board as the train leaves. That decision, by the
way, will never change for you — i.e., it looks awful but the train is leaving
the station. Do you pull the trigger? The answer is yes. FYI, there was also
convergence with the S&P 500
(
SPX |
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PowerRating) which hit a 1334 low vs. the .38 RT of
— yes — 1334, and within a point of its 50-day EMA. The entry was also a 1,2,3
pattern.Â
I know it was full moon,
but the numbers were in such sympatico it was eerie, and that’s maybe
what the Turk saw, also. He might have felt the tech fear was getting a bit
overdone and decided to intervene because it sure as well wasn’t fundamentals —
and very rarely is, at least regarding timing. Nevertheless, it was fun — but
that was yesterday.Â
Maybe today we get the
Opening Reversal to the upside vs. the classic OR to the downside by the NDX
yesterday. The market makers took it down 2% on the opening, only managed a
contra move of + 27 points, then to the cellar it went. The rally off the recent
.50 RT level was 5% and yesterday it was 3.5% off the 2349 low.
If there were any real
buyers, you would expect more upside continuation today.
(March
|
||
Fair Value
|
Buy
|
Sell
|
6.60
|
7.90Â |
 5.30Â
|
Stocks
Today
Like a broken record, I
tell you to keep scrolling those Semis for intraday setups preceding any
continuation entries over the previous day’s high or low. Check your closing
ranges and play the range breakout. I did some work last night on the Semis and
many have retraced one-half to two-thirds of their monster rallies, so you are
now at interesting levels again. Check that
list I gave you.Â
Daily
chart setups today are
(
CMVT |
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PowerRating), QCOM,
(
CIEN |
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PowerRating),
(
GMST |
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PowerRating). Also
(
DOW |
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(
WMT |
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PowerRating),
(
FITB |
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(
IBM |
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PowerRating),
(
FISV |
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(
BMY |
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PowerRating), and
(
MU |
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PowerRating) (just for
example: It closed at 38.82; the 50-day EMA is 37.88; the closing range high is
39; and yesterday’s low was 37.37. I’d say with that on your screen, you’re
going to get a trade long or short for sure today. Also
(
INTC |
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PowerRating).
By
the way,
(
CSCO |
Quote |
Chart |
News |
PowerRating) a surprise? Hardly. All that dialogue about “first
time in five years.” What does that really mean? The stock traded to $82 in
April, 2000, down to 31 15/16 on Jan. 3, 2001. Yesterday’s low was 29 7/8. Last
sale was 31 1/16. The closing range high is 31. If they come for it, take it
over 31 — you know where the downside is. Fundamentals don’t mean a thing —
it’s all in advance. It’s the perception and obviously CSCO was well known, well
in advance.
Have a good trading day.