Holiday Liquidity
Yesterday
was excellent for daytraders, as the NDX 100 ran 6.2% from the
previous close to an intraday high of 2347 before 1:00 p.m., and the S&P 500
ran 20 points to 1285. There were strong moves in the oversold stocks from the
prior day, especially
(
ITWO |
Quote |
Chart |
News |
PowerRating), as well as the semiconductors and biotechs.
Before the rally faded and the afternoon downtrend started, semis like
(
MU |
Quote |
Chart |
News |
PowerRating)
and
(
TXN |
Quote |
Chart |
News |
PowerRating) had advanced 10.4% and 11%, respectively, and the
(
SMH |
Quote |
Chart |
News |
PowerRating)‘s ran
to 50.40. The
(
BBH |
Quote |
Chart |
News |
PowerRating)‘s advanced to 166 13/16 before noon.
As markets change from
advancing to sideways to down, so does the volatility, emotions and perception.
A daytrader must adjust position size down and widen stop parameters to adjust
for volatility. If you get a quick pop, take the profit on half or a minimum of
1/3 of your position, and you will probably better manage your trade.
Today can bring anything,
as the futures and program agendas can dominate as the Generals and floor
professionals are less than full staff. The bias is up. The semis, biotechs and
the crazy Chosen Ones, where a stock is dead if it doesn’t have at least a 10%
travel range, can provide all the daytrading action you can handle. You must
start the trading day with a specific plan of entry in your selected stocks. I
suggest that you put your out orders in right after you get a confirmed
execution. By doing that, you take your own emotions out of the trade, and it is
far less stressful, especially in this kind of volatility.
face=”arial, helvetica”>(March Futures) | ||
Fair | size=2>Buy | size=2>Sell |
18.05 | Â 19.60Â | Â 16.50Â |
Pattern
Setups
Stocks today: After
yesterday’s afternoon fade, it didn’t leave many long setups on the daily charts
which had any sustained buying pressure. So today your setups are keyed to the
intraday charts once again. Some semis to focus on with the early entry levels
are
(
MXIM |
Quote |
Chart |
News |
PowerRating) >48 5/8,
(
LLTC |
Quote |
Chart |
News |
PowerRating) >46 7/8,
(
MU |
Quote |
Chart |
News |
PowerRating) >31 7/16,
(
TXN |
Quote |
Chart |
News |
PowerRating)
>44 5/8,
(
TER |
Quote |
Chart |
News |
PowerRating) >32 3/4 and
(
ADI |
Quote |
Chart |
News |
PowerRating) >47 11/16. Also, if you play
the SMH’s, >47 11/16.
If these stocks should open
higher, which they look like they certainly will, then wait for second entry if
you get it. Trading above the eight-period moving average of the highs is where
you want to be. Also, watch
(
CSCO |
Quote |
Chart |
News |
PowerRating) >39 1/8,
(
SUNW |
Quote |
Chart |
News |
PowerRating) >27 7/16 and
(
EMC |
Quote |
Chart |
News |
PowerRating) >59 5/8, just in case the Generals want to cover some of that stock
they have been selling since September and roll their costs down, or just not
show more cash than they should at year-end.Â
In the Chosen Ones, there
are many of them you can focus on, but I just picked out
(
JNPR |
Quote |
Chart |
News |
PowerRating) >95
3/16,
(
CMVT |
Quote |
Chart |
News |
PowerRating) >93 3/4,
(
QLGC |
Quote |
Chart |
News |
PowerRating) >64 3/4 and
(
MERQ |
Quote |
Chart |
News |
PowerRating) >81 1/2.
In biotechs,
(
HGSI |
Quote |
Chart |
News |
PowerRating) >64 7/16,
(
IMNX |
Quote |
Chart |
News |
PowerRating) >39 7/16 and the
(
BBH |
Quote |
Chart |
News |
PowerRating)‘s
>161 5/8.Â
Have a good trading day, and I hope
everyone has a very, very happy holiday.
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