Good evening StockBandits!
European concerns weighed on the market this morning to trigger a significant downside gap, but it ended up simply being a case of the bulls running late for work. The lows of the session were set in the opening minutes of the day, and a slow grind higher followed. By the closing bell, the market hadn’t erased all the losses, but the damage was contained.
Each of the averages probed support levels, and for now, held them. That included the lower channel line for the S&P 500, the 1160 level for the RUT, and the 4371 level for the NAZ.
Last night’s swing candidate EOG did not trigger today and actually failed the bullish pattern, so it is no longer on my trade list. Heading into tomorrow’s session, there are only a handful of names of interest to me, with each of them being single-day candidates in this fickle tape.
Let’s get to the charts.
NAZ – The NAZ broke 4371 today by 20 points, but lifted enough off the session low to close back above it by 25. That gives it just a little bit of breathing room, making the next couple of sessions potentially pivotal. The bulls could produce a lift and this would be a very important technical test, whereas a breakdown would likely set the stage for a lower high on the next bounce.
SP500 – The S&P finished 12 points off its low today but still down on the session after briefly undercutting the lower channel line. Tonight it stands some 26 points from the upper channel line, giving it some room to rally if the buyers step up.
RUT – The RUT is still the heavy index as it finished 10 points off its low today and still ended the session lower by 1%. The 1160 level has been tested now, but it’s only a few ticks away. That doesn’t give the bulls much room to work with, plus we saw each of the prior pullback lows broken today at 1168 and 1154, respectively. The creation of a lower low and the intense selling of the past several days leaves this index looking vulnerable to something deeper than the 5% correction off the high it has already seen.
DJIA – The DJIA saw a wider range today as it pulled back deeper into the former trading range. The breakout failure remains in place for now, keeping this senior index between two well-defined boundaries at 16735 (support) and 16978 (resistance).
Notable Names:
PCYC has been in this wide low-level channel since April following a big decline. Here it’s starting to work higher within the range, and looks good for a quick rally to the $104 area if it can clear $98.50. I like it only for a single-day play given the range-bound price action and the sector (drugs).
QUNR is just beneath the upper trend line of a bull flag here after a big recent rally and subsequent profit-taking. I like this one for a single-day play on the long side if it can clear $28 on Friday to exit the flag and start heading higher.
MKTO has been pulling back and today made a new low before reversing to finish slightly positive (and only 5c off the session high). This looks good for an upside trade if price can show some follow through to clear the trend line at $27.60 and resume the snapback which may have started today.
GDP is resting here after a hard selloff and therefore is building a bear flag pattern. It may need a bit more time, but if it makes a new low at $22.20 I’ll look to grab it for a single-day play on the short side Friday.
SFM is looking heavy here after a prolonged rally and the rollover move which is now underway. I like this one for a single-day play on the short side if it can show some downside follow through with a new low at $31.10.
New Swing Trade Candidates:
No new swing candidates tonight, still waiting for patterns to develop further with better risk/reward profiles.
Bullish Watch (click for charts)
Bearish Watch (click for charts)
Trade Like A Bandit!
Jeff
