Vulnerable
On Thursday, the Nasdaq opened lower but immediately popped
higher. However, it quickly found its high and sold off. The selling
accelerated on news of the Milan airplane crash. After this turned out to be
non-terrorist related, the index found its low and chopped its way higher.
The S&P put in a similar performance. This action keeps
it below the 1130-ish resistance level.
So what do we do? The fact that the S&P can’t seem to
get through 1130, combined with a TRIN Reversal sell signal, suggests that the
market remains vulnerable. Further, Microsoft missing their earnings (down two
bucks in early after-hours trading) can’t be a good thing. Therefore, look to
nibble on the short side but remember, Friday is option expiration so it could
get bumpy.
Looking to potential setups, Siebel Systems
(
SEBL |
Quote |
Chart |
News |
PowerRating), in
the vulnerable software sector, looks like it has the potential to resume its
downtrend out of an inverted cup and handle.
Best of luck with
your trading on Friday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
“….Your idea about the MAs narrowing, crossing and setting up in proper order sure is a good one. It makes flipping through charts a piece of cake; another great idea from your marvelous book…..”
Grant C.
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