Good evening StockBandits!
With the NAZ having broken the uptrend line which began in March yesterday, it was poised for follow through. It didn’t disappoint. Stocks suffered another down day as the dip buyers remained absent, allowing the S&P 500 to also undercut its uptrend line with today’s weakness. This is both technically & psychologically significant for this market, as it shows a shift in the mindset of buyers and an expansion in volatility for the first time in quite a while. That’s great for us as traders, I might add!
Heading into tomorrow, it’s a really tough call and there’s not a lot out there set up for new plays. I have no interest in stepping out in front of a southbound freight train and trying to buy this market, at least until some stability sets in. At the same time, many stocks are short-term oversold, which means it’s difficult and risky to initiate new short sales for anything but day trades (due to the ability to set tight stops). This market could continue lower, but if we get a downside washout early in the day, such as a gap down, I think it’s possible we see a bounce kick in. That’s pure speculation, but worth noting.
Whenever we do see a bounce, it’s going to be very insightful as we’ll be able to gauge much better whether things have truly changed or not. If the buyers are reluctant, or are quick to raise cash soon after a bounce begins, then it’ll be a signal that perhaps a little larger correction could unfold. For now, we’ll wait and see what the next few days bring.
Here is tonight’s video:
The Bandit Broadcast Video – Click to Watch!
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Video Stocks Discussed: FCX, WHR, FCN, MCO, MON, BAC
Swing Trading Candidates:
NONE TONIGHT
Bullish Watch:
SRS, RAI
Bearish Watch:
CA, PWRD, FCN, PFCB, MCO, MPWR, UTHR, VNO, MON, BAC, BIIB
The Hit List will be coming out soon with discussion on open positions, stops and targets, so be sure to watch for it.
