Good evening StockBandits!
The morning econ news wasn’t very well-received, and the market traded slightly lower in the early going, including a gap to the downside. Knowing that the FOMC was coming though, traders abandoned aggressive positions and opted for the sidelines until the big market-moving event of the day came to pass. That delivered a gap fill before a few hours of lateral movement. With the Fed sticking with the expected plan, there were no surprises and stocks saw a modest lift for the final two hours of the session. That made the difference, because by the closing bell, each of the averages had gained some ground.
The S&P actually closed at 1883, which is the major resistance level it has faced going back to early March. Volume increased with today’s action, although we’ve not yet broken out. Stated otherwise, today’s action just left something to be desired. The gains were pretty lethargic, the DJIA stopped shy of a breakout, the S&P landed right on the number (didn’t blow through it), the NAZ barely nudged past the Monday-Tuesday resistance, and the RUT finished 0.4 above yesterday’s high. That hardly constitutes strength in my book, but the bulls are maintaining a bid for now which still gives them a shot at building on the higher-low scenario.
I’m finding right now to be a particularly difficult time to find good trades. On occasion, that just happens. Sometimes it’s a matter of recent volatility not allowing sound bases to form, sometimes it’s scheduled news like earnings season, sometimes it’s mixed signals among the averages, and right now it’s pretty much all of those. Even corresponding with other veteran trader friends I’m hearing the same thing from them, which adds some validity to what I’m finding. What I’ve found over the years is that during times like this, staying selective helps me stay objective, and that means I’m better positioned for a lasting move once it finally arrives. Until then, I’m taking what the market is offering by way of quick-flip trades while otherwise sitting on my hands.
Send me your tickers for tomorrow’s Charts on Demand video if there are a few you’d like me to include. Sometimes it’s helpful to get a 2nd opinion on what you may be seeing in the charts.
Let’s get to the charts.
NAZ – The NAZ saw a slight improvement in volume today, although it remained below average. Price was hesitant to lift, but a higher short-term low is in place right now so the bulls have a shot at another rally here if they want it. Next resistance is 4185 which has stopped the previous two bounces.
SP500 – The S&P continues to deal with 1883, and tonight’s fractional close above it doesn’t yet constitute a breakout. What we now need to see is some follow through and upside acceleration to leave this range behind and get a breakout which can stick. We’ve seen plenty of rest in recent days, so if the bulls can’t produce it now, they just don’t have it.
RUT – The RUT painted a bullish engulfing bar today, which isn’t saying a whole lot given the very small range we saw on Tuesday. Nonetheless, the stage is set here for a bounce with a short-term higher low already painted, so all eyes are on the bulls to see whether or not they’ll produce it. 1160 is the next big level, so there’s certainly some room here for a lift.
DJIA – The DJIA tried to break above the December high again today, but ultimately closed a few points beneath that big level. This is a wide range of roughly 550 points which could produce a nice measured move higher if we do get a breakout. The next couple of sessions are likely to be pivotal as we either break out or roll over within the range. Any upside breakout will need to stick, so some acceleration would be important.
Notable Names:
SUNE closed down a few cents today but well off its low. The stock may be attempting to complete this light-volume pullback, so I’m watching the descending trend line just overhead. A push past $19.40 looks good to me for a single-day play on the long side with room back to the high from last week.
OAS saw a bit of a shake-out day today with a wide-ranging bar and a strong close. It now looks poised for a pop so I’m looking to get long for a single-day play if price can clear $46.70. If it can, the high from last week at $48.22 becomes the next resistance.
WUBA is a volatile stock which is also pretty liquid. It just held support and then finished higher today, within a short distance of the descending trend line marking the pace of the pullback it’s trying to complete. I like this one for a single-day play on the long side if price can clear $40.20, and there’s plenty of room for a spike higher (including the unfilled gap near $44 from last week).
PTEN is at the descending trend line drawn along the recent highs and looks to be trying to turn back up after a minor dip and a few days of lateral movement. A break above $32.70 looks good to me for a single-day play on the long side as this one attempts to regain some momentum.
AMBA is at key support here after plenty of failed bounces in recent weeks. A breakdown at $24.40 looks good to me for a play on the short side. I like this for a single-day move since no swing stop is evident, so I’ll just look to grab it for the initial break if it occurs.
WTW keeps rolling over to support despite a massive gap lower in February and lots of lateral movement since then. A new low at $19.40 looks good to me for a single-day play on the short side to participate in the initial break. Here again, no swing stop is readily apparent, which leaves me uninterested in an overnight swing.
New Swing Trade Candidates:
No new swing trades tonight, maintaining cash to put to work once better setups arrive.
Bullish Watch (click for charts)
Bearish Watch (click for charts)
Trade Like A Bandit!
Jeff
