Here’s One Way To Play Friday’s Employment Report
I’m Dave Landry and I approved this column.
On Thursday, the Nasdaq gapped lower and after an initial
pullback, sold off hard. It found its low around mid-day and generally worked
its way higher before selling off again going into the close.
This action puts it right at its 200-day moving average.
The S&P put in a similar performance.
So what do we do? The late-day rally
after the indices approached their recent lows could suggest that the indices
are trying to bounce from oversold. Longer-term, most sectors remain in strong
downtrends, especially those that are technology related or interest rate
sensitive. Therefore, continue to look for shorting opportunities. Use caution
though. The fate of the market on Friday will likely be determined by the well
anticipated Employment Report. With that said, aggressive traders may look to
fade an initial knee-jerk reaction should it occur.
As far as setups, Cymer
(
CYMI |
Quote |
Chart |
News |
PowerRating), mentioned Wednesday
night and in the weak
semi-equipment sub-sector, faked out on Thursday but still looks poised to resume its persistent
downtrend out of a pullback. This is especially true if it trades below
Thursday’s low (i.e., a “second entry pullback”).
Best of luck with your trading on Friday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
P.P.S. My new 20-hour course is now shipping.
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