Here’s How You Can Benefit From ‘Bad’ News
Looking to the indices, on Wednesday, the Nasdaq opened firmer but soon began to
chop around. It sold off by mid-morning but managed to recover to close well and
in the plus column.

The S&P rallied throughout the morning, dipped around
mid-day, and then rallied going into the close.

So what do we do? After the bell, there was
a negative reaction to earnings from both Intel and Yahoo. Therefore,
this will likely pressure the market in early trading. However, stocks can often
reverse on bad news (or more accurately news perceived as “bad”). And
since the market has been so strong as of late, it wouldn’t surprise me if we
saw an early morning sell off in the indices followed by an intra-day reversal
and a rally. Therefore, for the brave and nimble, this could set up an
interesting day trade, especially in INTC and YHOO. For everyone else (swing
traders/longer-term traders), you probably want to take a more cautious
approach to see how market digests the news on Thursday.
No setups tonight. If the market pulls back over the next
few days, we should see numerous setups soon.
Best of luck with your trading on Thursday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
P.P.S.
In February I’m having a small, exclusive three-day swing trading seminar and I would like you to attend.
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