Good evening StockBandits!
Another sizeable gap hit the market today as pre-market buy orders built up on the heels of a quiet weekend in Japan and what looks to be the start of some changes in Libya. The opening minutes provided just about the only excitement, however, as the indexes topped early in the session and then spent the remainder of the day in choppy sideways trading ranges.
Volume failed to confirm today’s upside as well, and was well below average in each case. Given the combination of little intraday follow through and light volume on the third straight up day (and following a pair of weak finishes on Thursday and Friday), this isn’t the kind of setup that inspires big confidence for the bulls. Yes, they’ve seen plenty of V-shaped recoveries over the past couple of years, but those were one-off pullbacks which were quickly erased. At this point, we’ve got 1 confirmed lower high and this bounce could still quite easily lead to a 2nd. Stated otherwise, this appears to be a bounce within the intermediate-term correction.
I’m still not trusting of this bounce, and intend to remain in cash on Tuesday, instead sticking with day trades. The daily charts of many stocks are still obviously quite messy with the wide-ranging volatility of just the past few sessions, plus we’re still getting big gaps. That makes holding overnight positions (swing trades) very difficult at best since risk can’t be managed in the same manner as it can be when the market is trending better. That’s perfectly alright though, as there are times when capital preservation is the best plan, and right now is one such time.
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: URI, CVI, WSH, BHI, INFY, JAZZ, ULTA, OC, PRU, FCX
Swing Trading Candidates:
NONE TONIGHT
[table “8” not found /]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.
