Keep That Sticky Note
On Tuesday, the Nasdaq opened flat but soon mounted a
decent rally. However, late in the day, it reversed and sold off hard. This
action has it closing poorly.
The S&P also had an
“upside down U shaped day”–rallying in the morning and selling off in
the afternoon. This action leaves a tail higher.
So what do we do? Once again,
we
have a plethora of buy (and repeat buy) signals on the Market Bias page. And,
once again, under normal
circumstances, I’d be pretty excited. However, momentum still favors the
downside. I guess I need to keep that sticky note* on my monitors. Therefore,
continue to wait for some confirmation in price before
getting too excited about a bounce play in here.
Looking to potential setups,
Syncor International
(
SCOR |
Quote |
Chart |
News |
PowerRating) looks like it has the potential to resume its
uptrend out of a pullback.
Even though it reversed, USA Education
(
SLM |
Quote |
Chart |
News |
PowerRating) (mentioned Friday) still looks vulnerable.
Walk Through Continued
Lately, we’ve been doing a
“walk through” on Broadcom
(
BRCM |
Quote |
Chart |
News |
PowerRating), a stock mentioned recently. If you haven’t
already done so, you might want to review this commentary. When we last left
off, our trailing stop remained at a two-bar high. On Tuesday, the stock hit
this stop (a) to take us out of our remaining shares. What’s aggravating is, the
stock promptly reversed and lost 4% of its value. However, I can assure you,
they won’t always turn around after stopping you out. Therefore, HONOR YOUR
STOPS. Tomorrow (Wednesday), we’ll take a look at Cubist Pharmaceuticals
(
CBST |
Quote |
Chart |
News |
PowerRating), a stock mentioned last Friday. For more on how to manage positions,
see my articles under Money
Management.
Best of luck with
your trading on Wednesday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
*For those new to this column, a while back I
suggested putting a “sticky note” on your quote monitors which reads
“we’re still in a bear market”.
“…Dear Mr. Landry,
I want to send you this note to thank you for the excellent book that you have written. I have enjoyed so much reading your book and I appreciate for
your hard work, creativity and professionalism. Your book is a must-read for every serious trader. It is simple, concise and to the point, but also full of useful detail. Again, thank you for such a wonderful job….”
Pablo C.
Argentina
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