Nothing Wrong
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.
Dave Landry is en route to Chicago to attend Tony
Saliba’s options seminar this weekend and will return on Monday. In his absence
this column is being written by Duke Heberlein.
On Friday, the Nasdaq Composite
(
COMPX |
Quote |
Chart |
News |
PowerRating) gapped slightly lower on
the open, slid lower and reversed off its first intraday low and gained 50
points to hit its intraday high. From there it fell 60 points to its low before
gaining back almost half of the losses to close near the middle of the day’s
range, still staying solidly over the 50-day moving averages.
So where do we go from here? While I can’t rule out another
probe towards the April lows in the future, I like the fact that the Naz did not
really do anything wrong, and a little pause had to be expected. It’s still
tracing out higher lows and higher highs, and if they are not going down its
quite possible they could be going up. Another thing I like is that all the
indices finished up for the second bar on their weekly charts. Since often the
market will play out in threes, there is a good chance that we could see
that all important third bar to the upside. I would, however, keep some shorts
in mind just in case the market, as it is often want to do, doesn’t act as
expected.
Looking ahead to setups for Monday, Computer Associates
(
CA |
Quote |
Chart |
News |
PowerRating),
off the Proprietary
Momentum List and Momentum
10 Technology List, is forming a pennant after a momentum gap off the 50-day
moving average.
Harrah’s Entertainment
(
HET |
Quote |
Chart |
News |
PowerRating), also on the Proprietary
Momentum List, is tracing out a flag following its thrust higher. It has also
left two consecutive Lizards on the daily chart
SkillSoft
(
SKIL |
Quote |
Chart |
News |
PowerRating), from the Pullbacks From Highs
List, appears likely to retest its prior high, and Advanced Energy
(
AEIS |
Quote |
Chart |
News |
PowerRating)
is building the handle to go with its three-month cup.
Keeping an eye on some setups for the short side, Hershey
Foods
(
HSY |
Quote |
Chart |
News |
PowerRating), from the Proprietary
Implosion List, has formed an outside day with a down close in a month-long
downtrend. If the stock breaches its last area of support (red line), look out
below.
Finally, Essex Property
(
ESSX |
Quote |
Chart |
News |
PowerRating) appears ready to
resume its downtrend out of a pullback from lows.
Have a great weekend and best of luck with your trading on
Monday.
Duke
P.S. Protective stops on every trade.
P.P.S. If you do happen to be down around Dave’s neck of the
woods this weekend, I highly recommend stopping in and saying hello to Bubba.
His gun collection is impressive, and he does get kind of lonely when Dave is
out of town. Just be sure to announce yourself if you pay him a call, you don’t
want to spook him, trust me.