Wait For First Pullbacks

• April 19, 2001
• Dave Landry

On Thursday, the market became even more
overbought. This has many sectors, mainly tech continuing the transition from
downtrend to uptrend. I’ve charted a few of these sectors below: biotech
(
$BTK.X |
Quote |
Chart |
News |
PowerRating), software
(
$GSO.X |
Quote |
Chart |
News |
PowerRating), and internet
(
$IIX.X |
Quote |
Chart |
News |
PowerRating). It’s crucial to watch the nature
of these and other tech sectors for their first pullbacks. If they have an orderly correction, then
they will be worthy of calls and calls spreads as the market pivots back into the
direction of the new trend.

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src=”https://tradingmarkets.com/media/images/Landry3/monkey041901.gif” width=”470″ height=”320″>

src=”https://tradingmarkets.com/media/images/Landry3/iix041901.gif” width=”470″ height=”320″>

The one thing that
I did find interesting is the fact that the major oils
(
$XOI.X |
Quote |
Chart |
News |
PowerRating) look very
bullish while
(
$OSX.X |
Quote |
Chart |
News |
PowerRating) looks bearish. For the adventurous, there may be a
call/put hedge play here.

src=”https://tradingmarkets.com/media/images/Landry3/xoi041901.gif” width=”470″ height=”320″>

src=”https://tradingmarkets.com/media/images/Landry3/osx041901.gif” width=”470″ height=”320″>

Best of
luck with your trading on Friday!

P.S. Reminder:
Protective stops on every trade!

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