Two Ways To Look At Weakness
The
market is healthy! Who really believes that right now? Especially
after we just saw the major averages open strong and close week for two
consecutive days.
In reality, the market,
especially the Nasdaq is VERY healthy right
now. Other than a few hiccups, price and volume have not
led us to believe anything other than accumulation is going on right
now. The tail the Nasdaq left on 7/14 still saw the index advance over 1% on
heavier volume than the previous day. We have seen leading stocks such as eBay
push higher.
There are two ways we can
look at weakness as we saw on Monday and Tuesday: a great opportunity or a
potential problem with the current advance. Fortunately for us, the last
blatant distribution day on the leading Nasdaq was back on 6/30. We are in the
clear at this time and weakness should be construed as opportunity. Market
pullbacks are always a good time for new setups to occur. We have seen a
drought for a couple of weeks with onlFy a few names here and there. Granted,
these few names have performed very well, but stocks such as
Ryland
(
RYL |
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have attempted bases but broken out prematurely or without enough support
behind the move.
 
My
Trading Service was able to establish some very solid positions in the
Spring and early Summer. Now is the time to watch
the market leaders as they establish new entry points and allow capital to be
put to work after the historically slow summer trading time. Keep an eye on
names such as
(
HITK |
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(
EBAY |
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(
LEND |
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COH |
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(
RYL |
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(
UNTD |
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(
GPRO |
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(
UTSI |
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Until Thursday,