Too Much To Ask?
On Tuesday, the Nasdaq open lower but found its low fairly
early. It then rallied for much of the morning before drifting lower during the
mid-day doldrums. Finally, by early afternoon, it began to rally again and
followed through all the way into the close.
The S&P also had a decent
day. It recouped almost all of Monday’s sell off.
The top of its recent
range/50-day moving average will likely provide resistance to the upside here.
And, last week’s lows remain a reference point to the downside.
So what do we do? It seems that the media throws a party
when we have an up day and shrugs off the down days. I’m still seeing a lot more
set up on the short side than the long. Therefore, until proven otherwise, my
focus remains on the short side. Keep in mind that I’m not a “dyed in the
wool” bear, I just would like to see the markets prove themselves by doing
something as simple as rallying above the 50-day moving average and stabilizing.
Is that too much to ask?
There’s not too much to look at again tonight.
On the short side, Cima Labs
(
CIMA |
Quote |
Chart |
News |
PowerRating) looks like it has
the potential to resume its meltdown out of a Bow
Tie.
Advent Software
(
ADVS |
Quote |
Chart |
News |
PowerRating)
looks poised to continue its downtrend out of an inverted cup and handle. I
flipped the chart to save you the trouble of standing on your head.
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Walk Through
On
Monday we talked about where you could have entered, placed protective stops,
taken partial profits and trailed stops on Abgenix
(
ABGX |
Quote |
Chart |
News |
PowerRating), a short
mentioned last Friday. On Tuesday, the stock bounced but failed to take out our
trailing stop at 30 (a). Therefore, we will leave this stop in place.
For more information on money management and position
management see this column’s archives (on the side of this page) and read my articles under Traders
Lessons.
Best of luck with
your trading on Tuesday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
Hey Goran, I have fans too:
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