Set Up To Chop
Each evening we focus
on the most interesting aspects for the upcoming trading
day. The comments are based on observations of the nightly
updates of the Stocks/Sectors and Market Bias pages. They
are provided for educational purposes only and are not
intended to be direct trading advice. Also, keep in mind
that these remarks are made up to 12 hours in advance of the
markets opening. Therefore, overnight events may alter the
outcome of these observations.
The Nasdaq open flat
on Wednesday, mounted a decent rally after selling off a bit, but gave up most of
its gains, ending up just about where
it started.
Technically, it looks like it may be stalling out and ready to correct
from its recent up-leg. The other way of looking at is that it was just pre-Fed
indecisiveness.
So what do we do? The follow through in some of our setups
on the long side is encouraging. However, because the Nasdaq itself
stalled out and combined with relatively low VIX levels, it suggests that
we could see a pullback in here. Further, after hours, there was a plethora of
earnings and announcements. Add in Greenspan’s speaking and all of this can make
for choppy trading on Thursday. Therefore, keeping it light (on either side),
trail your stops and play both sides.
Looking to potential setups, 724 Solutions
(
SVNX |
Quote |
Chart |
News |
PowerRating), mentioned Tuesday night, looks
poised to continue its rally out of a Bow
Tie (a). Ditto for Digital Lightwave
(
DIGL |
Quote |
Chart |
News |
PowerRating).
MIPS Technologies
(
MIPS |
Quote |
Chart |
News |
PowerRating) looks like it
has the potential to rally out of a Bow Tie/Low level cup and handle.
Millicom International Cellular
(
MICC |
Quote |
Chart |
News |
PowerRating),
mentioned recently, still looks like it has potential. Just wait for follow
through to the upside here as it did close poorly.
On the short side,
Entergy Corp.
(
ETR |
Quote |
Chart |
News |
PowerRating), mentioned recently and on
the Pullbacks
Off Lows List, still looks poised to resume its
downtrend.
Macromedia
(
MACR |
Quote |
Chart |
News |
PowerRating), also on the Pullbacks
Off Lows List, looks like it has the potential
to resume its downtrend out of a “simple” pullback.
Best
of luck with your trading on Thursday!
P.S. Reminder:
Protective stops on every trade!
“…..Mark Boucher’s The Hedge Fund Edge is my
trading bible, but Dave Landry On Swing Trading is an excellent hymnal.”
Ron S.
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