Good evening StockBandits!
The main event of the day ended up being a non-event as the indexes finished only slightly changed after the FOMC announcement and policy statement at 2:15pm ET. The indexes were negative at one point and higher than where they finished, but in the end no lasting momentum was found. Apparently traders are undecided at this point on just what to make of all the headlines.
I noted earlier this week how it was possible that the market could take a bit of time to digest all the news, and thus far it seems that’s what’s taking place. Last night’s election results are widely known, and today’s FOMC unveiling of QE2 surprised nobody with the widely-anticipated size of the program. Often times when the market rallies on expectations and then gets what it wanted, we see a sell-the-news response. So far, however, we have yet to either rally or sell off a significant amount, and the wait continues.
We’re still right in the thick of earnings season, and of course on Friday morning we’ll have the Employment Situation, which the market has watched quite closely of late. Stated otherwise, there’s more news to come, but the biggest headlines of the week are now behind us. Perhaps the collective market needs to sleep on it before making a decision, but today’s action was surprisingly subdued for the magnitude of the news we received.
In terms of technical levels of importance, we did see the NAZ make a new 2-year high today as it cleared the April peak just slightly, but the S&P remains roughly 2% shy of its spring high here. The DJIA and RUT each remained beneath their next levels of resistance at 11258 and 719, respectively. More setups have emerged on the daily charts of individual stocks, and with the event risk now largely removed for the week, I’m looking at a number of setups for tomorrow’s trading.
As a reminder, for a few weeks I’ll be utilizing the written format of the Broadcast as we’re in the process of moving and therefore without the equipment I use for recording the nightly video. Once I have my new office set up, I do expect to be back to the usual video format. To those who prefer the video, thanks for your patience. To those who prefer this written format, I hope you are enjoying seeing more text! At any rate, it’s refreshing to me to be able to mix it up a bit. And of course, your input is always welcomed.
For tonight, my notes are on the charts below for index levels and potential trades I’m eyeing for Thursday.
Please leave your comments and/or questions below if you have any, I always enjoy the interaction.
Swing Trading Candidates:
DRIV remains in a solid uptrend here and the most recent push to new highs came on extremely heavy volume following earnings news. It has since pulled back on reduced volume and appears to be stabilizing here. Today it attempted to turn up through a trend line, so I’m watching for follow through to indicate a new leg up is starting. I’m looking to buy this one for a swing trade if the $37.15 level is crossed, and will have my stop and target levels on the Hit List here inside the Hideout.
FCX has spent the past few weeks in a narrowing consolidation after a very clean rally, and this one could easily get back on the move any day now. With the trend being up, I’m watching trend line resistance at $98.50 for a breakout to get long for a swing trade. As with all swing trades, my stop and target levels will be here inside the Hideout on the Hit List post.
EAT turned sharply lower two weeks ago on heavy volume. Since then, it has bounced in a reluctant fashion with closes well off the intraday high each of the past 4 sessions. I’m watching the rising trend line of support for a potential break, which would trigger a short sale for me at $18.60. As with all swing trades, my stop and target levels for this trade will be on the Hit List here inside the Hideout.
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:
TMO, LDK, DRIV, UAL, MAR, SOHU, MOTR, SMOD, BGC, SCSS, RCII, VSEA, SWKS, RHI, SNDK, FCX, SOL, NTGR, PWRD, SWC, FORM, GPS, OAS, AMD, KMX, AMG, TZOO, ALB, JACK, LCC, WMS, BIIB, SVVS
Bearish Watch:
ICE, FLS, PFCB, VFC, LZ, CHRW, MON, CF, XRAY, PVH, EAT, GES
The Hit List contains stop and target levels for my swing trades.
