Wrong This Time?
On Thursday, the Nasdaq opened firmer but quickly found its
high and began to chop its way lower. It did manage to rally late in the day but
turned down again going into the close. This action sets up a pullback from lows
and suggests the index will return to those lows.
The S&P (and the Dow) was choppy but managed to
put in a decent performance. It too could be setting up as a pullback from lows.
So what do we do? I see no reason to fight the big blue
arrows. Sure, I’ll be wrong on the last pullback, but in more recent
times, this hasn’t been a problem. Therefore, focus on the short side especially in technology, now that the Nasdaq itself is set up as a pullback from
lows
Looking to potential setups, the Software ETFs
(
SWH |
Quote |
Chart |
News |
PowerRating)
look poised to continue their downtrend out of a pullback from lows.
On The Trail
When I last left off, I was discussing how I choose where
to place my trailing stops, using Varian Semiconductor
(
VSEA |
Quote |
Chart |
News |
PowerRating), a stock mentioned recently, as an example. Recently, I had
discussed using a stop just above the 2-bar high. Let’s assume that this got hit
on Thursday. FYI, the stock now looks like it has the potential to make another
leg down.
Thanks!
Thanks for all the well wishes regarding Isidore. Other
than the potential of being trapped in the neighborhood (don’t worry, I had
Marcy buy lots of beer, meat and charcoal before it hit), it looks like we
skirted this one.
Other
The storm has put a bit of a dent in my schedule. If you
did not get a reply on last night’s offer regarding my sector analysis (see
archive), I should be able to get to it on Friday.
Best of luck with
your trading on Friday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
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