Good evening StockBandits!
The wild ride known as October came to completion today, but not before another move was made. A weak start to the day produced a downside gap which stuck, followed by several hours of churning, trendless price action. No real attempt was made to fill the gap, and ultimately new session lows were seen in the final hour of the day.
Last Thursday’s gap was mostly respected today as prices retreated to that area for a test. We saw a slight gap fill begin, but it was only partial. It wouldn’t be surprising to see that gap ultimately get filled, which would mean a return to Wednesday’s closing levels (NAZ 2650, S&P 500 1242, RUT 727, DJIA 11869). The market has made great strides off the early-October lows, so some backing and filling would be a healthy technical event. We wouldn’t need a complete turnaround or even a long-lasting pullback, as even just a couple of weeks worth of digestion would allow many charts to set up new bases.
The good news is that the market has been able to put in some rest in recent weeks, which was something we saw absolutely none of after late-July. With that said, traders aren’t necessarily counting on another hard reversal like we saw numerous times throughout August and September. With the end of the year approaching and stocks just having put in a big advance, performance anxiety may play a role in the weeks ahead. If so, that could result in a higher low and another attempt at a rally as bulls put more cash to work and bears back away from a strong market.
I’ll cover my game plan for tomorrow in the video, and as always, feel free to share your own thoughts, trade ideas, and questions down below in the comments section.
Here is tonight’s video:
The Bandit Broadcast Video – Click to Watch!
Video Stocks Discussed: ADTN, SODA, VRA, P, FSLR, IDCC, DV
Swing Trading Candidates:
NONE TONIGHT – 100% cash.
[table “157” not found /]The Hit List is a separate post which contains discussion on open positions and swing trade stops and targets, so be sure to check it for further details on swing trades.
Hi Jeff,
Are these trading candidates for tomorrow the right ones?
NAV seems to be in two places. Bearish and Long. ????
Updated, sorry for the oversight. Was heading out a bit early for some trick-or-treating with our little boys (Milli Vanilli)! Go get ’em tomorrow and thanks for the heads up Brad & Tao.