Time To Nibble?
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
market’s opening. Therefore, overnight events may alter the
outcome of these observations.
On
Wednesday, the Nasdaq gapped down to its low (a) and rallied to close at its
high (b).Â
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The Nasdaq was much choppier intra-day than
the daily bar suggests. I view this as a positive as those who gave up in
frustration will be forced back in when a clean rally begins.
So what do we do? The market is now set
up for a bounce from these levels. I’m basing this above index action and those
stocks that are set up. Therefore, there may be an opportunity to nibble on
the long side. As usual, just wait for triggers on your setups. Also, watch for
a pop-up opening. If we do get a pop-up, you might want to wait for second
entries.
face=”Arial, Helvetica”>Looking to potential setups, it seems like pullbacks
will be the obvious play for Thursday. With that said, Cirrus Logic
(
CRUS |
Quote |
Chart |
News |
PowerRating)
is a three-bar pullback of a stock in strong uptrend.Â
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Bell Microproducts
(
BELM |
Quote |
Chart |
News |
PowerRating), also on the Pullbacks
Off Highs List, is in its first pullback since making a fast break higher.
LaBranche and Co.
(
LAB |
Quote |
Chart |
News |
PowerRating), in the hot
financial sector (LAB is a specialist firm), appears to be rallying out of a
deep pullback.
Barr Labs
(
BRL |
Quote |
Chart |
News |
PowerRating), on the Trading
Where The Action Is List, is conceptually similar to a high-level saucer and
handle.
For you
breakout players, Abgenix
(
ABGX |
Quote |
Chart |
News |
PowerRating), mentioned Tuesday night, rallied nicely
on Wednesday out of a cup and handle and is just shy of taking out its recent
highs.
Best
of luck with your trading on Thursday!
face=”Arial, Helvetica”>Dave Landry
P.S. Reminder:
Protective stops on every trade!