Good evening StockBandits!
A quick selloff from the open today failed to threaten yesterday’s lows, so in keeping with the current trading range, stocks bounced considerably. The lack of follow through I’ve noted day after day here was again exemplified in today’s action, as Monday’s decline was perfectly erased in the S&P 500. Such is the nature of trading ranges, as support gets bought and resistance gets sold.
That’s not to say we’ll stay here forever, because we won’t. The moves within the range have become pretty emotional, so once we do see a break, it’s likely to catch some off guard and produce a meaningful move. At the moment though, we’re still waiting for that break.
Tonight on the daily charts of the indexes, some wedges have become more pronounced. That gives us well-defined trend lines to watch for both resistance and support, giving the aggressive trader some closer levels to keep an eye on for a possible exit from this range. Conservative traders can continue to monitor the highs and lows of the past 2 weeks, which aren’t far outside the wedge trend lines.
My trading focus right now continues to have a short-term timeframe, as this reversal-prone market simply doesn’t aid multi-day moves. Swing trading is best done with the proverbial “wind at your back,” which is to say long-sided swing trades work best in a climbing market, and short-sided swing trades work best in a declining market. In the short-term, a trending market is absent (since we’re range-bound), and therefore one less favorable element is present for swing trading. Once we leave the range, some good opportunities should surface, but this market just isn’t trustworthy yet for multi-day follow through in either direction.
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!
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Video Stocks Discussed: OKE, HSIC, SRZ, TDC, MGM
Swing Trading Candidates:
NONE TONIGHT
Bullish Watch:
OKE, BKD, ALXN, KMX, JNPR, SM, MCO, RAX, RCII, ROK, KSU, SWK, CSX, EMN, WAT, MERC, SKH, BIIB, CVX, FCEA, HSIC, SRZ, TTI, CTSH, TUP, TDC
Bearish Watch:
MGM, AKAM, SCCO, SFY, NVDA, CMI, TRW
The Hit List is a separate post which contains discussion on open positions and swing trade stops and targets, so be sure to check it for further details on swing trades.
