Premature Celebration?
On Monday, the Nasdaq opened higher and after a brief blip
lower, began to rally nicely. It then chopped around throughout mid-day before
resuming its intra-day trend going into the close.
The S&P also rallied to close well.
So what do we do? The media was quick to throw a party for
technology, once again calling a bottom. They were especially fond of biotech
and the semis. I’ve put the charts below. You be the judge. True, it could be the
bottom. However, based on recent history, it’s probably not. Therefore, on
the short side, look for opportunities in technology but make sure you wait for
entries just in case it can pull off more than a “one day wonder”. On
the long side, the value stocks such as banks and stocks that can trade contra
to the indices such as gold continue to do well.
Looking to potential setups, Astoria Financial
(
ASFC |
Quote |
Chart |
News |
PowerRating),
in the strong S&Ls, looks like it has the potential to
resume its uptrend out of a pullback.
For ideas on the short side, there area a lot
of tech stocks set up on tonight’s Pullbacks
From Lows List. Genentech
(
DNA |
Quote |
Chart |
News |
PowerRating), at the top of that list, looks
like it has the potential to resume its strong downtrend.
Best of luck with
your trading on Tuesday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
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