Here Are A Few Names For Wednesday

September 3, 2003
Kevin Haggerty

What Tuesday’s Action Tells You

The anticipation was realized, as the Generals
showed up putting some new money to work these first days of September as they
have in the previous months during the rally off the March lows. NYSE volume
expanded to 1.4 billion, which is not a gold rush, but relative to recent volume
it is positive. Breadth was excellent at +1314, with the volume ratio all one
sided at 84 for a four-day moving average of 74, along with the 60-minute
five-period RSI going out at 90 to extend the short-term overbought condition.
This is not uncommon when there is a move through a key inflection point, and
especially when it is on a breakout of the fourth attempt through the 1015
level, which had some coiled spring power as the SPX
(
$SPX.X |
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PowerRating) followed
the Dow
(
$INDU |
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(
$COMPQ |
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PowerRating). The SPX went out at 1022,
+1.4% on the day, accelerated during the 2:30 p.m. ET to 4:00 p.m. time period.
The Dow finished at 9523, +1.1%, Nasdaq 1841, +1.7%, and
(
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PowerRating) +1.5%.

For Active Traders

Thanks to the futures noise on the ISM report
yesterday, traders were able to get on the train after the SPX pullback to the
60 EMA (20 EMA on the 15-minute chart). Entry was above 1006.59 and it was trend
up for the rest of the day with nothing close to getting stopped out. Entry was
on the 10:25 a.m. bar for the
(
SPY |
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PowerRating) above 101.20 and on the E-mini above
1007.

After the first move traded up to 1015.58 on the
SPX, traders got another retracement to the 60 EMA with good entry on the 2:00
to 2:10 p.m. bars, catching the 10 point acceleration into the close. The
opening green futures had carried up to 1013.50 and then got pushed down on the
10:00 a.m. ISM reaction. Trading these reactions due to futures noise is the
mainstay of the morning time period. Let’s hope it doesn’t change because it’s
not the Generals buying or selling stock on these mystical manipulated economic
numbers the media jumps all over.

Today’s Action

In addition to the SPX yesterday following the
lead of the Dow and Nasdaq out of the trading range as the Generals put some new
money to work with many hedge funds front-running the order flow, there are some
more economic reports these next few days that should provide some more intraday
reaction trades.

There were quite a few stocks that came out of
ranges yesterday along with the SPX, and many of them on wide-range bars, so on
these types of stocks you are better off today looking for the daytrade on
intraday pullbacks or second-entry trades above yesterday’s high. Stay away from
any early breakout above yesterday’s wide-range-bar highs.

Have a good trading day,

Kevin Haggerty

Here Are A Few Names For Wednesday

BUY THE FEAR, SELL THE GREED

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