Not The End Of The World
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On Monday, the Nasdaq opened firmer but quickly reversed.
Then, after a mid-day bounce, it resumed its sell off. This action has it
closing poorly.
The fact that we reversed at the prior highs is somewhat
concerning. However, so far, it’s not the end of the world. A correction might
be just what the doctor ordered.
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The S&P also reversed at its prior highs. This action
puts it back below its 200-day moving average.
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So what do we do? As implied
above, it now appears that the market is entering a corrective phase.Â
Therefore, you might want to tighten stops on existing longs, take some profits
if you have them and look to fire off a short or two until this correction plays
out.
Looking to potential setups,
Centex (CTX),
mentioned Friday and in the strong residential construction sector, still
looks like it has the potential to rally out of a pullback. Wait for an entry,
though,
as it was down on Monday.
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Best of luck with your trading
on Tuesday!
 Dave Landry
P.S. Reminder: Protective stops on every trade!
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