Time On The Side
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.
On Wednesday, the Nasdaq gapped lower on the open but
quickly found its morning low. It then began to rally for what looked like would
be a solid
trend day higher. However, it found its high early in the afternoon and sold off
to end up just about where it started.
Markets can correct by either
going down or by sideways movement–also known as time or “time on the
side.” It seems that so far, the Nasdaq is doing
the latter. Since I’ve been away (last Thursday night), the Nasdaq has
essentially gone nowhere
on a closing basis. The good news is there has been some nice follow
through in some of the longs mentioned last week. This suggests that we are
in a normal base building process, and the longer we continue to base above the
50-day moving average, the better.
So what do we do? As you know, I try to keep things as simple as possible.
Therefore, for now I think as long as we hold above the 50-day moving average
and
we can continue to find stocks that follow through, then the logical focus will
remain on the long side.
Looking to potential setups, Expedia
(
EXPE |
Quote |
Chart |
News |
PowerRating), on the Pullbacks
Off Highs List, looks poised to resume its strong uptrend.
Celestica
(
CLS |
Quote |
Chart |
News |
PowerRating), also
on the Pullbacks
Off Highs List, looks poised to resume its strong uptrend out of a
high-level “mini” base.
Agil Software
(
AGIL |
Quote |
Chart |
News |
PowerRating) looks poised to rally out of a
cup and handle-like formation.
Best
of luck with your trading on Thursday!
P.S. Reminder:
Protective stops on every trade!
P.P.S. Special thanks to Duke for filling in
while I was away, to my in-laws for keeping the kids alive and to Bubba
for not killing anyone (this time).
“…While most
trading books talk are long on theory and lack specifics, Dave shows you what to
do Monday morning….â€
Scott
R.
No risk, 30-day, money
back guarantee.