Good evening StockBandits!
Last night I noted the fact that while the market was rebounding from support, a trading range was still in effect and therefore reversals were still likely to take place. That remains the case, and today we saw the market respond to negative AAPL news (with Steve Jobs’ departure) as well as upbeat BAC news with Buffett taking a sizeable stake. Ultimately, the buyers weren’t motivated to take action, and early strength disappeared in favor of more selling. By the closing bell, the indexes had given back the entirety of Wednesday’s gains and then some.
The major averages therefore remain caught in their respective trading ranges tonight. Although the environment remains volatile, the wide ranges allow for plenty of movement between the boundaries. This appears to be a phase of digestion from the selloff which started in late-July and carried into early-August, and until we get free of the range, we can expect continued indecision. The wide-ranging bars we’re seeing on most days in recent weeks also means sloppy charts for individual stocks, leaving us with little to focus on in terms of trades for anything but a few hours at a time.
Tomorrow, the Fed takes center stage with Bernanke’s 10am ET speech. While traders may have been jockeying for position this week ahead of the main event, the fact is that nobody knows what will be said tomorrow. That opens the door for surprise or disappointment, which could make tomorrow another lively trading session. It would take a significant move for the market to exit the range tomorrow, so while that’s possible, it’s more probable that we’ll have to wait until at least next week for a push beyond one of the boundaries (early-August lows or mid-August highs).
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: SINA, P, GOLD, PLCM, RVBD, APKT
Swing Trading Candidates:
NONE TONIGHT – 100% cash.
[table “108” 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.
