Good evening StockBandits!
A gap higher on Friday was met with some initial selling as stocks settled into a choppy range for the session. Some level of strength was maintained though, and with a late push we saw the market go out within spitting distance of the day’s highs.
On the week, the NAZ and S&P 500 each gave up more than 2%, which was actually healthy from a technical standpoint. The previous two weeks had seen nearly straight-up ramps which left the indexes very stretched to the upside. The sharper a move gets, the more reversal-prone it becomes, so some profit-taking like we’ve seen actually opens the door for the market to possibly reset for another advance.
The biggest challenge of the past several weeks has been the erratic price moves and the effects that has had on the charts. That has prevented individual stocks from setting up the kinds of bases and rest phases needed for swing trading setups, but now with some continuation patterns appearing in the form of flags and pennants, more potential plays are beginning to surface.
I’m encouraged by that, as it brings another timeframe into play rather than just day trades. I don’t mind the cash-flow nature of day trades, but ideally like to have capital at work across multiple timeframes as a way to participate on more moves. That also adds a layer of diversification for trading, so I’m hoping to see more swings going forward no matter which way the market heads.
We’re getting into earnings season and it’s time again for a reminder to check the earnings calendars daily for any multi-day trade. Amateurs like to gamble on earnings outcomes, but professionals avoid that risk since it can’t be managed effectively. Keep that in mind these next few weeks! I like to check both EarningsWhispers and Yahoo Finance. No matter where you look, just be sure to look and compare multiple sites to help confirm reporting dates.
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: TZOO, TSCO, P, HOG, GSVC, FIO, DE, WDC, WLP, PPO, CROX, CAM
Swing Trading Candidates:
PPO pulled back from its recent high on light volume, and now has a shot at a turn back up if it can clear the trend line. I’ll be using that as a pivot for a buy, getting long if the stock clears $69.20 on the way back up. Earnings are due out August 1st according to Yahoo Finance, so I’ll look to be out of this trade ahead of that date. As with all swing trades, my stop and target levels for this stock are on the Hit List here inside the Hideout.
CROX has pulled back quietly but held its uptrend quite well, and now could turn back up for another leg higher. I’ll be going long this stock if it can cross the trend line with a push through $26.60. Earnings are due out August 1st according to Yahoo Finance, so I’ll look to be out of this trade ahead of that date. As with all swing trades, my stop and target levels for this stock are on the Hit List here inside the Hideout.
CAM broke through a multi-month downtrend line with good upside acceleration, and has pulled back quietly to digest that move. It now looks ready for another push up, so I’ll be a buyer if this one can clear $50.75. Earnings are due out July 28th according to Yahoo Finance, so I’ll look to be out of this trade ahead of that date. I’ve set only 1 target for this play on the Hit List, but if earnings are approaching and the stock seems to be slowing down, I may look to make an exit prematurely (along with an intraday update via Twitter & email). As with all swing trades, my stop and target levels for this stock are on the Hit List here inside the Hideout.
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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.
