Some Good Advice To Remember
I’m Dave Landry and I approved this column.Â
On Thursday, the Nasdaq opened lower but found its low in
early trading and began to rally. It found its high around mid-day and began to
sell off. Finally, it chopped back and forth to higher going into the
close.Â
This action has it stalling short of its 200-day moving average–a level that corresponds with short-term
resistance.Â
The S&P put in a similar performance.Â
Around 15 Years ago I complained to someone about a trade
that they recommended to me. I’ll never forget what he said in response:
“David, no one rings a bell for you when a market makes a top or
bottom.” Yesterday, a popular business channel was celebrating (to
the point of being grotesque) the fact that the market bottomed soon after their
guest analyst called for a reversal. Folks, it’s just not that easy.Â
So when will I chime in and call for a retrace? I think
it would have been much more healthier for the market to have completed its
washout on Wednesday followed by a huge gap down opening on Thursday. This
action would have created a “throwing in of the towel” panic type
situation and would have likely cleared the way for bounce.Â
So what do we do?  The trend remains down
in the indices and vast majority of sectors. Therefore, use the market bounce as
an opportunity to re-establish positions on the short side.Â
As far as setups, Ingersoll-rand
(
IR |
Quote |
Chart |
News |
PowerRating), in the weak
manufacturing sector (a), looks poised to continue its strong downtrend (from
multi-year highs) 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 now shipping.
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more, or to order.