Moron Continues To Follow Trend Lower
Each evening we focus
on the most interesting aspects for the upcoming trading
day. The comments are based on observations of the nightly
updates of the Stocks/Sectors and Market Bias pages. They
are provided for educational purposes only and are not
intended to be direct trading advice. Also, keep in mind
that these remarks are made up to 12 hours in advance of the
markets opening. Therefore, overnight events may alter the
outcome of these observations.
Heads up! After the close, Intel
(
INTC |
Quote |
Chart |
News |
PowerRating) announced an
earnings shortfall. This will likely weigh heavy on tech on Friday.
On
Thursday, the Nasdaq opened near its high and closed near its low in what
appears to be a resumption of its downtrend out of a pullback from lows.
So what do we do? As you know, my approach to trading is
not rocket science. In fact, I’m known as a “trend following moron.”
With that said, there are many stocks in strong downtrends that are resuming
their downtrends out of pullbacks from lows. I think the potential for a Chinese
water torture back to the old lows in the overall market is a gift for the short
seller (vs. a waterfall which would be fun…but short lived).
Looking to potential setups, Charles Schwab
(
SCH |
Quote |
Chart |
News |
PowerRating), mentioned
recently and in the weak broker/dealer sector
(
$XBD.X |
Quote |
Chart |
News |
PowerRating), still looks vulnerable.
Continuing on the broker/dealer theme (see tonight’s
Options Outlook), Morgan Stanley Dean Witter
(
MWD |
Quote |
Chart |
News |
PowerRating), on the Pullbacks
Off Lows List, appears to be in trouble.
The Broadband Holders
(
BDH |
Quote |
Chart |
News |
PowerRating), mentioned recently
and on the Pullbacks
Off Lows List, appear to be resuming its downtrend.
Best
of luck with your trading on Friday!
P.S. Reminder:
Protective stops on every trade!
“....For
me, the best part of the book was the very simple concept of Trend Qualifiers.
This concept is exquisite in its elegance and simplicity. Well done!….”
Tom F.
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