No Tickee, No Tradee
On Wednesday, the Nasdaq gapped lower on the open,
and continued lower. This action has it down another 4% for the day,
and down nearly 10% in the last five days–anyone remember the 7
Market Bias sell signals five days ago?
Wednesday’s action brings the index all the way
back to the bottom of its recent range, and just a stone’s throw away
from its 50-day moving average.Â
Obviously the breakout for the top of the range
has failed.
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The S&P also
looks like a failed breakout now that it has traded all the way back
to bottom of its recent range.
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So what do we do? The market is now very
oversold. However, as you know, just because a market is oversold
doesn’t mean it can’t go lower. Therefore, don’t try to catch a
falling knife.Â
Looking to potential setups, to my surprise,
there are a few longs that look interesting. However, as usual,
and especially in this environment, make sure you wait for entries. In
other words, and at the risk of preaching, no tickee, no tradee.
Genesis Microchip (GNSS),
on the Pullbacks
Off Highs List, tailed lower, but reversed to close well. This
suggests that its strong uptrend remains intact.
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Idexx Laboratories (IDXX),
also on the Pullbacks
Off Highs List, looks poised to rally out of a Trend Pivot
Pullback.
On the short side, you might want to keep an eye
out for Bow
Ties in stocks that might be failing after recently forming tops.
With that said, Albertsons (ABS),
on the Pullbacks
Off Lows List, looks poised to continue its downtrend out of
a Bow Tie.
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Best of luck with
your trading on Thursday!Â
P.S. Reminder: Protective stops on
every trade!
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