Good evening StockBandits!
Thursday’s failure to hold new highs when reached last week left traders with something to ponder over the weekend, and it wasn’t long today before some selling kicked in. Once the indexes moved into the red, they stayed there for the remainder of the session. Although some support was found after the morning selling, the lift from the lows into the afternoon was very minor. That raises the question of the whereabouts of the dip-buyers who have been so prevalent in this market lately.
One day of downside doesn’t seal the fate of the market, although there are certainly some reasons here for caution. Aside from last week’s failure to hold short-term breakouts to new highs, we have the NAZ breaking a 3-week uptrend line today and the RUT falling back beneath 670. The S&P 500 did hold the 1130 zone where it recently broke out, but all in all, we saw some selling today that could test the bulls in the near term.
Should this pullback happen to get deeper in the coming days, that wouldn’t be unhealthy to see. Pullbacks and rest phases actually help to perpetuate uptrends, as they help prevent advances from getting too stretched. The steeper a move tends to be, the more easily it can simply reverse. So, ideal uptrends are in fact accompanied by some dips along the way, and even the bulls realize that in the current environment.
For now, a pullback is getting underway but we lack clear signals that the selling is intensifying. Heading into Tuesday, I’m planning to stick with shortened timeframes for new trades while waiting further technical clues.
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!
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Video Stocks Discussed: VXX, CAGC, FTNT, MON, APA, ENER
Swing Trading Candidates:
NONE TONIGHT
Bullish Watch:
EQR, VXX, NTES, RES, LVS, FTNT, MIPS, ARBA, MAR, MYGN, EBIX, CAGC, HOG
Bearish Watch:
CRK, MON, CSX, ADBE, BIG, NE, SWN, NYX, RTN, PXD, ENR, APA, LLL, PNC, ACM
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.
