Good evening StockBandits!
The bulls had yet another great opportunity on Friday to produce a meaningful breakout from the multi-week trading range as the major averages got to within just a few points each of their respective key resistance levels. Needing a close above 2205 (NAZ), 1113 (S&P 500), and 10,500 (DJIA), the indexes could never quite gather enough steam to clear the hurdles. Instead, we saw a quiet Friday with more sideways trading action, along with only minor net changes and mixed results by the closing bell.
The thing about trading ranges is that they can really test our patience. Continuation traders find them extremely frustrating, and there’s a sense that just a little nudge might do the trick to get prices back on the move. As a result, it’s easy to get focused just a little too under the microscope, where every newly-painted bar on the chart appears it could be the start of the next meaningful move. Of course, the series of failures and reversals will slap the hands of many traders who are overly anticipatory, which serves as a great reminder to us that we must wait for confirmation of a new move before aggressively taking action.
We are still bound by a trading range, and therefore if we’re going to be effective, we must keep timeframes shortened and a tighter leash on trades, staying selective with new plays until the overall market can get back on the move. Once that happens, we’ll be able to count on some better follow through and the assistance of the broad market. For now though, the waiting game continues.
Please leave your comments and/or questions below if you have any, I always enjoy the interaction.
Here is tonight’s video:
The Bandit Broadcast Video – Click to Watch!
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Video Stocks Discussed: NSC, PSS, RMBS, RIG, FLS, ACL, BBY, CLI, FCX, ARO, PBR, GDX, RGLD, VNO
Swing Trading Candidates:
VNO has bounced sharply from its lows of just a couple weeks ago, and over the past several days it has rested quietly with only a minor pullback. This price action has created a well-defined bull flag pattern, so I’m watching for a breakout through the upper flag trend line at $70 to trigger a buy. My trade parameters are in the Hit List post.
Bullish Watch:
ACL, NTRI, NSC, BBY, PLD, HCP, CHKP, TTM, SEED, F, TRW, GD, SWSI, WY, CBS, CBT, VNO, ASIA, BEAV, PSS, RMBS, CLI, SLG
Bearish Watch:
CLF, PCU, FCX, MTL, RRC, CNQ, DO, STR, DVN, CNX, XOP, RIG, PBR, OXY, NUVA, ERTS, FWLT, AIG, LNC, RYL, MBT, STT, MFE, FLS, BIDU, AU, GG, BVN, GDX, RGLD, GOLD, ABX, SLW
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.
Took position on VNO @ 69.32, then added some after confirmation of upside breakout….
Good work there Jim, I like how you quick-flipped the anticipatory portion for the fast payoff.
Thanks, Jeff…I see I posted in 2 spots now…sorry…I will keep my comments in the hit list area to keep things simple..
took some profit at 70.76, still 3/4 position.