Reasons Not To Be Excited About This Market
Looking to the indices, on Thursday, the Nasdaq opened
lower but found its low fairly quickly and began to rally. However, it found its
high around mid-day and then chopped back-and-forth for the remainder of the
day.
The S&P put in a somewhat similar performance. So far,
it appears to be stuck in a sideways trading range.
So what do we do? Thursday’s action, if you
can call it that, wasn’t very impressive. I think an oversold market could
have done much better. So far, the S&P remains stuck in a range. The Nasdaq
remains below its 50-day moving average (the red line above) and below overhead
resistance. Considering the above, my thinking remains the same: there really
isn’t any reason to get too excited about this
market (as a momentum trader). Therefore, yet again, if
you must trade, make sure you stick with selected areas of stronger sectors such
as health services, leisure, financial, telecom, and
insurance. On the short side, tech sure looks like it will begin to provide some
opportunities soon. Therefore, begin putting together your watch list in areas
such as computer hardware, semis, software, and Internet.
Looking to potential setups, Aflac
(
AFL |
Quote |
Chart |
News |
PowerRating), (you just
made the duck noise, didn’t you?), in the strong insurance sector (and let’s face
it, who wants weak insurance?), looks like it has the potential to resume its
accelerating uptrend out of a pullback.
Best of luck with your trading on Friday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
P.P.S. My new 20-hour course is being released on Friday, February 28.
Click here for details.