Once Again, Exactly What You Should Do In A Market Like This
Looking to the indices, on Thursday, the Nasdaq opened
higher on the excitement of Applied Materials
(
AMAT |
Quote |
Chart |
News |
PowerRating) earnings but soon
found its high and began to wane. Then, after some mid-day consolidating, the
selling resumed in afternoon trading. This action has it closing poorly and all
the way back to its 50-day moving average (the red line below).
2100 now appears to be formidable resistance.
The S&P also sold off after initially trading higher.
Once again, this action keeps it below
resistance, circa 1160.
So what do we do? I had hoped that the AMAT
news would lift the semis (and tech) off of their buttocks. However, as you can
see, this didn’t happen. Therefore, I suppose the song remains the same:
Until the S&P and Nasdaq can get above resistance levels, I don’t think there is too much that should be done.
These feelings are further confirmed by the fact that my database
continues to produce very few meaningful setups. This is especially true when you
require (as I do) confirming sector action.
No setups tonight. If the indices can plow through
resistance, then we should see stocks setting up on the long side. If the market
continues to slide, then we should see transitional setups (shorts). For now,
continue to wait it out.
Best of luck with your trading on Friday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
P.P.S.
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