One Step Forward, Two Steps Back
Due to a scheduling conflict, Dave Landry will be
unable to write his Stock Trading Outlook. Tonight’s column is written by
Trader’sWire’s Duke Heberlein. Dave will be back on Monday, November 20.
Wow. Another volatile day in this market. After an announcement by Florida
judge Terry Lewis that the Secretary of State Kathleen Harris acted within her
authority in refusing amended election returns, the market surged on the news.
Then, on a new announcement that Vice President Gore’s legal team was quickly
filing an appeal to force hand counts to continue and be recognized, the market
proceeded to drop 100 points in a little over an hour. It then managed to climb
slowly up off the intraday low to close relatively unchanged.
This puts the Nasdaq in what appears to me to be a vulnerable
position, resuming its downtrend and falling out of a pullback from lows. Our
likely target looks like Monday’s low around 2859.
So, where do we go from here? Based on Friday’s action, the
logical plan is to look primarily to the short side for tradable setups, and use
only the best performing stocks during this downtrend to consider as long side
candidates. As always, when volatility is greater, consider tightening stops and
taking on smaller positions.
Looking ahead to possible setups, Bellsouth
(
BLS |
Quote |
Chart |
News |
PowerRating), on the Stocks
Crossing Below Their 50-Day Exponential Moving Average On Double Volume List,
closed in the bottom portion of its range and appears to have additional
momentum available to the downside.
Protein Design Labs
(
PDLI |
Quote |
Chart |
News |
PowerRating), from the Proprietary
Implosion List, broke down from a low-level consolidation in Friday’s
trading, look for continuation here.
Possible long-side setups include CR Bard
(
BCR |
Quote |
Chart |
News |
PowerRating), from the
Proprietary Momentum List. The stock has broken out of a low-level cup-and-handle and looks as if it has the potential to continue higher.
Talbot’s
(
TLB |
Quote |
Chart |
News |
PowerRating), off the same list, had a breakout on an
expansion of its daily range. Maximus
(
MMS |
Quote |
Chart |
News |
PowerRating), from the Pullbacks From Highs
List, closed at the top of its range in a Cooper/Connors 1-2-3 pullback and
looks poised to move back to the upside.
Finally, Qualcomm
(
QCOM |
Quote |
Chart |
News |
PowerRating) has formed an inside day on its
chart inside Thursday’s wide-range bar. Look for potential upside action out of
this pattern if the market manages to turn.
P.S. Protective stops on every trade!
P.P.S. I hate to make a liar out of my good buddy Dave, who claimed no one
would be plugging his soon-to-be-released book. But I have to give him a plug
for his upcoming book on swing
trading at a 20% discount. I have read his manuscript and it is an
excellent book for both experienced traders who are looking at swing trading or
beginners trying to figure out what style of traders they are going to be.