Good evening StockBandits!
This market is really struggling to bounce. With the first substantial pullback in a while having taken place in recent days, the word “oversold” is surfacing in many places. While everyone’s definition of that may differ slightly, we can all agree that the underlying premise is that prices are moving lower at a pace which isn’t sustainable. From there, we know that either some stabilization will set in and a rest arrives, or a bounce eventually comes along to alleviate some of the pain (temporarily at least). Right now we’re still oversold, but stabilization hasn’t happened and neither has the bounce.
The index charts show rapid declines from the October highs, but the relentless dip-buying we have seen for so many months has, for the time being, disappeared. Profit-taking off the top brought about some heavier selling, and at this point it seems the bulls are finally considering whether or not that was “it” for this run. Today, for example, we saw the NAZ post its 7th straight session where the day’s high failed to meet or clear the prior day’s high. So we have 7 straight sessions of lower highs, and we’re still waiting for the short-term slide to end.
Meanwhile, I’ve really been eager to see a bounce come along. Not because I want the market to move higher (because being a trader I don’t care which way it goes), but because I think the character of the bounce and seeing how it’s received will shed a lot of light on the situation and let us know whether this pullback will ultimately be a blip on the radar or the first signal that the trend is changing. The jury is still out for now.
Here is tonight’s video:
The Bandit Broadcast Video – Click to Watch!
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Video Stocks Discussed: APOL, V, MAN, MICC, MON, TNB
Swing Trading Candidates:
TNB has held up very well lately, particularly given the weak market conditions, and the trend is still up for this one. A push above the trend line will trigger a buy for me at $35.10.
Bullish Watch:
TNB, DECK, NTRI, WHR, VPRT, V, JOYG, HS, MICC, MAN
Bearish Watch:
APOL, NTRS, AONE, MON, MTB
The Hit List will be coming out soon with discussion on open positions and swing trade stops and targets, so be sure to watch for it.
two comments…
COMPX inside day today. Last time the next day resolved down (direction of trend).
Wed is FOMC day. 2:15 announcement. Past few FOMC’s have been up in the morning into early afternoon, then who knows. Worth keeping in mind and caution from about 1:45. I typically tighten stops on any open day trades.
Hey Jon,
Good point on the last inside NAZ day, that gave us a good signal last week. This time, I’m reluctant to interpret it the same way just given the short-term oversold conditions we are in still without a multi-day bounce of any meaning. FOMC is always a wild card, anything is possible on those days especially.
Thanks for your comments!
Jeff