Positive But Vulnerable
On Wednesday, the Nasdaq rallied nicely early in the day.
Then, it chopped and drifted before selling off hard on the rumor of the Osama
Bin Laden tape. The good news is that it managed to close up on the day and
remains above its 200-day moving average.
The S&P put in a similar performance.
So what do we do? Right when I
was feeling all warm and fuzzy about holiday–week
trading, the market implodes on the UBL rumor. This reminded me of how choppy
and vulnerable a market can be when many of the players are off on vacation.
Therefore, continue keep it light until 2002.
Looking to potential setups,
Sage (SAGI)
looks like it has the potential to rally out of a pullback–like
formation.
On the short side, Merck (MRK),
mentioned recently, still looks vulnerable.
Best of luck with your trading
on Thursday!
Dave Landry
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