Good evening StockBandits!
The major averages slipped into the red right out of the gate today, chopped around for a few hours, then tumbled further into the close. The pullback has already erased the gains seen since Monday’s open for the each of the indexes, which puts at least a temporary kink into the bulls’ plans for a recovery. The S&P 500 and DJIA are each just a few points above their respective breakouts, leaving them not on the edge of greatness, but rather the edge of failure as virtually any downside from here would mean yet another peek-a-boo breakout failure.
We’ve had plenty of indecision in recent weeks, which was why there was so much pressure on the blue-chip breakouts to hold. Without the sympathy of the NAZ and RUT, they have gone it alone in hopes of dragging the speculative bunch along with them. But bounces are apparently still being used for raising cash in the latter indexes, and they’ve exhibited a reluctance to play along. Now with a 2-day pullback, we’ve seen them again take the lead on the downside.
Lasting momentum is still elusive right now, which makes this mostly a flipper’s market right now. With mixed messages among the averages, light volume, and frequent reversals, it’s just not yet an ideal time to be aggressive on a multi-day timeframe. That means single-day plays are still where the majority of the action is, and serves as a reminder to stay very selective with new plays until we see this market exhibit some better traction – up or down.
Tomorrow I’ll have the Charts on Demand video where I’ll take a look at the stocks you submit for review. The aim is to simply offer a 2nd opinion on the price action, but it’s usually good for some lessons and a few new names worth putting on watch. If there are some tickers you’d like to see me cover, send them my way!
Let’s get to the charts.
NAZ – The NAZ is pulling back here after stopping well shy of 4185 on the bounce which began last week. It looks like it could easily fill the gap created on Monday morning which extends down to 4071. Overall, it’s range-bound and these frequent reversals should be expected as long as the range stays intact. Note the light volume showing no commitment either way.
SP500 – The S&P is pulling back to test the breakout zone here, making the next few sessions potentially very important – especially for the bulls. 1883 is the big number to watch, followed by 1859 and then 1850. If it finds its footing, the high stands at 1902.
RUT – The RUT remains very weak and just carved out another lower high on the bounce. Price is now heading quickly toward 1091, now just 12 points away.
DJIA – The DJIA is also testing its breakout area after today’s pullback, so we’ll see if it can hold it or not. Volume is giving no meaningful indications here so all we have to go on is price. The good thing is that this level has been tested numerous times going back to December, so there is a clear zone to keep an eye on for a directional bias.
Notable Names:
PBR is shaping up for another lift here as it bases to digest the recent rally. A push through $15.90 looks good for a single-day play on the long side with potential for a quick lift to the unfilled gap near $17.
QCOR is another stock holding up well here after only a minor pullback in recent days. A turn up through the small trend line would occur at $88, with the next level to watch beyond that near $91. I like this one for a single-day play if it clears $88, but being a biotech I’m just not interested in an overnight.
SSYS has a string of lower highs in place so the trend is down. Here price has bounced slightly but is stalling out, so I’m looking for a turn lower through the small trend line at $89.20 to grab it for a single-day play on the short side. The low from last week is near $85, so there’s some room here.
FSLR was listed here last night but showed some hesitation this morning before some afternoon weakness. I’ll give it another shot on the short side if it makes a new low to show some continuation through $61.45 on the downside.
YELP made limited progress today after being listed here last night but still looks good on the short side now that it’s starting to roll over. There’s plenty of room, but this one is somewhat gap-prone so I’ll just grab it for a single-day play if it breaks $54.30 on the way down.
New Swing Trade Candidates:
No new swing candidates tonight, choppy market conditions and loose bases too prevalent.
Bullish Watch (click for charts)
Bearish Watch (click for charts)
Trade Like A Bandit!
Jeff
