Good evening StockBandits!
The rebound from Monday’s lows continued today, although the indexes once again found it tough to hold onto gains. They finished slightly positive, but for the third straight day they backed off their session highs by the closing bell. That suggests there are still sellers present, and it’s keeping this bounce difficult to trust.
From a technical perspective, it’s not surprising to see a bounce take place. We saw multi-week uptrend lines broken last week with a harsh move lower, and that quickly took the market into short-term oversold territory. To see some attempt at a bounce following that was to be expected, but it’s the way this is unfolding that should leave the bulls feeling a bit unsettled.
Aside from the poor finishes of the past 3 sessions, we’ve also seen volume remain light on the way back up. That’s no doubt in part due to the seasonality of late-August with many traders taking late-summer vacations before school starts, yet technically, it’s still a negative. A high-volume selloff followed by a weak-volume bounce is not what lasting rallies are made of. And on top of all that, the market is still struggling to reclaim former key levels, such as 1100 on the S&P 500 – a level tagged both yesterday and today before pullbacks in each case.
For Thursday, I’m once again looking to limit my activity to intraday plays, as this market simply isn’t showing enough follow through to justify putting more capital to work on an overnight basis. We’re getting a relief bounce right now that’s lacking conviction, but it hasn’t come to a halt yet. That leaves me unwilling to commit to new longs or shorts at the moment, so I’m mostly waiting.
I’ll cover my game plan for tomorrow in the video, and as always, feel free to share your own thoughts, trade ideas, and questions down below in the comments section.
Here is tonight’s video:
The Bandit Broadcast Video – Click to Watch!
–
Video Stocks Discussed: NETL, ICE, UFS, APKT, WDC, VMW, CME, SM
Swing Trading Candidates:
NONE TONIGHT
Bullish Watch:
AUXL, MMYT, APKT, DRQ, BORN, EBAY, UFS, BAX, BID, CROX
Bearish Watch:
WDC, VMW, CSC, GOOG, CME, MFE, NETL, ICE, RRC, SM, VECO
The Hit List will be coming out soon with discussion on open positions and swing trade stops and targets, so be sure to watch for it.
