Good evening StockBandits!
It’s getting to be a bit of a jumpy market with decent-sized gaps in 3 of the last 4 sessions. These are most clearly visible on the NAZ or RUT charts, although effectively it’s taking place everywhere. Headlines or just shifts of opinion seem to be the culprits, as we’ve seen it happen in both directions. Yesterday it was on the upside, today on the downside, with each of them looking convincing with follow through in the direction of their respective gaps.
While it’s easy to start overreacting, the truth is that we’re still range-bound. That means we’ve gone nowhere of great significance, which is the hallmark of any zone of indecision. Just when it seems there’s some real momentum starting to emerge, stocks reverse course and temporarily head the other direction.
Knowing this, our job is to bypass it if possible – at least until there’s evidence of a bigger move mounting via a range exit. I’ve been doing that via single-day plays lately, opting not to add swing exposure in a market that’s trending laterally. Why add exposure if there’s no market tailwind to help out?
Let’s get to the charts.
Bullish Watch (click for charts)
Bearish Watch (click for charts)
Trade Like A Bandit!
Jeff
