Good evening StockBandits!
**SFUN PRICE CORRECTED**
Bears in need of a dip have gotten it. Simultaneously, underinvested bulls have been wanting a pullback, and they’ve gotten it. The door is wide open for bulls to put cash to work and carve out a short-term higher low, but will they walk through it? That’s the question on the minds of traders tonight after a 5-day pullback in the S&P. A streak like that sounds a bit harsh, but it’s been rather controlled with just a 2% slide from the highs. Meanwhile, the NAZ and RUT continue to sit not far from their highs and the waiting game continues for those of us wondering who’ll take charge next.
From the looks of things, we’ve pulled back and/or based pretty quietly the past few sessions, and that could quite easily pave the way for a more emotional move whenever it begins. Either we see the NAZ and RUT start to follow the senior indexes (S&P 500 and DJIA), or vice-versa. Any turn higher could quickly be embraced as an opportunity to buy, whereas any downside acceleration could further solidify that some short-term highs are in place. All we need now is a catalyst for the direction.
On the bright side, this mild pullback and basing action has helped to create some new patterns on the charts and I’m expecting to see more setups arriving over the next couple of sessions. I’ve got a new swing candidate tonight after going several days without any on the multi-day front, but a bit more work is still needed on the charts to either reduce risk or better-define entries, depending upon the pattern in question. My watch lists are growing though, and that’s a positive.
By the way, if you’re interested in submitting a couple of tickers for tomorrow’s video (Charts on Demand), hit reply to this email and I’ll be glad to cover them.
Let’s get to the charts.
NAZ – The NAZ saw another minor net change today and another finish near the middle of the day’s range. That’s 3 straight, which just points to this index marking time. The highs are within reach, but a deeper pullback has some room before the next level would be tested (3694).
SP500 – The S&P is respecting a small gap which stands between 1691 (today’s low) and 1687 from a couple of weeks ago. It moved slightly lower today to retreat a little further from 1709, although that’s only about 1% away from tonight’s close. The bulls have a shot here if they want it, but the delay in producing a turn back up points to some fatigue after the 102-point rally off the August low.
RUT – The RUT edged to a new high intraday but again closed well off the high. It keeps closing in the same little window between 1072 and 1077, with today’s finish marking the 6th consecutive finish inside that range. A move away from here could be a decisive one, so we’ll need to watch the high on the upside and 1063 (tested Monday) on the downside.
DJIA – The DJIA retreated again today to further accent the failed breakout attempt from last week after a new incremental high was made. Despite the short-term failure, the bulls still have a shot here to make this pullback into a higher low, but they’ll need to get in gear. The next bounce should reveal more to us about the resolve of the bulls in this index and the others.
Notable Names:
GOGO is still basing here and I’d prefer to see it tighten even further. A new high would happen at $19.25, so this one remains on my radar after all the recent strength it has exhibited.
XONE is below support tonight and still looks to have room on the downside with no nearby support. This one belongs on the radar of intraday traders as it has been a mover and could accelerate further here.
SFUN is at the apex of this wedge and a turn higher through $51.25 could produce a quick rally back toward the recent high. I like it for a single-day play if it can clear that level, but only if. A downside break could be equally potent, but given the trend is still up I’m only looking to trade the long side upon an upside breakout.
SINA is at trend line resistance tonight and could see a quick rally if it’s able to clear it. I like it for a single-day play above $83.50, but this is a sloppy base and a swing stop is just not readily apparent so this isn’t an overnight candidate for me.
TSLA is basing at the highs here and another breakout at $186.50 could produce another spike. I like it for a momentum play above that level but won’t look to hold it overnight.
QCOR is starting to falter after a minor bounce and looks poised to turn lower again. A break below $55.70 sets up a momentum play on the short side with room to quickly fill the gap to the $52 area. Here again, I won’t be holding this one overnight due to this being such a small base and a biotech as well (gap-prone).
FLTX is trying to bounce but just can’t seem to get it done after the big recent selloff. A turn down through $38.10 breaks rising support and sets up a single-day play on the short side for me. This base would need to tighten for me to consider it for a swing.
New Swing Trade Candidates:
These stocks look ready for imminent multi-day moves. Pattern confirmation occurs with a move through the entry level. Initial stop and target levels are also provided.
VIPS is starting to stabilize here after a 3-day dip and now a turn up through the trend line at $59 could put it back on the move to resume the uptrend. I’ll get long there for a swing with a stop below the pullback low in case of a reversal.
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Trade Like A Bandit!
Jeff
