Pullback Time

In the spirit of
simplicity,
I’ll limit the pre-chart commentary this morning to three
words: pullback, pullback, cross. The chart can do a better job explaining it
than I can.

Friday  July
13, 2001  11:15 AM EDT

Yesterday’s Day
Off

In light of the strong afterhours move
Wednesday night, I went into yesterday’s trading fully expecting to "take
the day off," meaning I didn’t have any expectations of intraday income and
wasn’t going to press to try to find it. I’ve come to learn over the years (of
course, learning often comes through pain) that intraday opportunities on mega
gap-up days after a recent market low are typically few and far between. I also
personally don’t prefer trading much on days where the natural market rhythm
becomes skewed by extraordinary news, as was the case with Microsoft
(
MSFT |
Quote |
Chart |
News |
PowerRating)

yesterday, as well as a few weeks ago.

While I often fade large gaps up or down at open as ma and pa retailer place
their market buy orders (often at or near session highs), the recent low
combined with MSFT’s impact eliminated any desire to do that, and yesterday
pretty much played out as expected, as hand-sitting was the theme of the day.

Unlike other careers where one must be actively doing something every day from
8-5, inactivity in this business is a chosen action in and of itself, as a
trader reminded me yesterday and as David Floyd nicely reinforced recently.
Besides, yesterday’s six-and-a-half hours comprised a mere 0.4% of regular
session trading time in a year.

Have a great and relaxing weekend.

Don Miller

For
a more in-depth look at how Don trades the QQQs, click here.