Good evening StockBandits!
In Sunday’s Broadcast, I included a comment regarding the stage being set for some drifty price action this week “unless some big news surfaces.” Well, today’s market drop was caused by exactly that, as stocks sold off with a downside gap in response to tensions between North & South Korea. The situation there could easily escalate and include the involvement of other nations as well. After an exchange of fire overnight, the world is on watch to see whether tensions will mount further or subside.
The market hates uncertainty, and anytime war is on the table we tend to see money flow to safe havens (such as the sidelines) and out of stocks. On a holiday-shortened week like this one where the volume is lighter to begin with, it takes even less to produce a meaningful move in price either way (up or down). So to see a sizeable gap down this morning get followed by some additional weakness on the heels of major geopolitical news isn’t surprising. With little else to focus on Wednesday and during Friday’s half-day session, we can expect the market to fixate on all headlines regarding this situation.
From a technical standpoint, the indexes have failed to reclaim key levels after attempts in recent days stopped shy, and we’re now seeing them turn back down toward the pullback lows of last week. It would be short-term bearish to see last week’s lows get taken out, and would imply this market has at least another leg lower to go.
With the market being closed Thursday and with Friday only being a half session and one of the lightest volume sessions of the year, I will not be trading on Friday (never do during Thanksgiving week). The action is just too difficult to gauge with all the light volume, and my attention is on spending time with family. As a result, the next Broadcast will be on Sunday night, hopefully with a return to video format! I hope you enjoy your Thanksgiving and get away from the screens for a few days to relax and be with those you love the most.
As a reminder, my wife & I are expecting our 2nd child sometime in the next 4 weeks, and our first child arrived 4 weeks early. Ideally this baby holds off a couple more weeks, but if I happen to fall off the radar for a couple of days, you’ll know why. Currently there are no signs to suggest that will happen, but with babies you just never know!
For tonight, my notes are on the charts below for index levels and potential trades I’m eyeing for Wednesday.
Please leave your comments and/or questions below if you have any, I always enjoy the interaction.
Swing Trading Candidates:
NONE TONIGHT
Day Trading Candidates:
These are the trades I’m eyeing for potential plays tomorrow. I will not be holding these overnight, and will wait for these levels to be crossed before entering trades.
Bullish Watch:
NOV, PSS, ABX, NG, ACOM, TSLA, JOBS, IVN, TGA, JAZZ, SODA, CREE, UA, SINA, VSH, MW, DKS, SRS, POWI
Bearish Watch:
MMM, SOHU, FCX, LNCR, OFC, JAH, MCP, PSA, JKS, LAZ, HCP, HCN, AKAM, ADTN
The Hit List contains stop and target levels for my swing trades.
