What A Former President Might Say To Traders
On Thursday, the Nasdaq opened firmer but quickly found its
high and began to sell off. It managed to rally late in the day, but this wasn’t
enough to keep it from closing poorly.
This action puts it back below its 50-day moving
average.
The S&P was firmer than the Nasdaq but was unable to make
it back to the plus column. This action keeps it below its 50-day moving
average.
^next^
So what do we do? It hasn’t been easy lately. The
lack of follow through has been frustrating. As one trader quipped, my longs are
sliding and my shorts just won’t go down. As our former president* would say:
“Ahhh feel ya pain!” It has been frustrating. The reversal
guys are about the only ones that seem happy lately. Therefore, considering the
above and the fact that the indices remain below resistance, you might want to
keep it light. On the long side, there are some interesting “high
flyers” that have recently corrected. Internet and security are a good
place to look here. However, wait for signs of follow through to the upside
since many have been hit hard as of late. On the short side, now that interest-rate-sensitive areas have bounced a bit (i.e., are pulling back), begin watching for
shorting opportunities here. REITs, electric utilities, banks, and homebuilders
are a good place to look.
As far as setups, Ask Jeeves
(
ASKJ |
Quote |
Chart |
News |
PowerRating), in Internet,
looks like it has the potential to resume its accelerating uptrend out of a
pullback. However, wait for entries since it, and Internet itself for that
matter, was down hard on Thursday.
Best of luck with your trading on Friday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
P.P.S. My new 20-hour course is now shipping.
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*Who never seemed to have a problem with his shorts going down.