Good evening StockBandits!
Stocks gapped higher this morning and the stage was set for a relief bounce after three consecutive declines, but the sellers showed up once again. Despite finishing in the green, we did see intraday selling take place as the highs of the session were made in the opening minutes and the gap was filled by mid-morning. From there, the market simply churned without demonstrating any lasting momentum in either direction.
We remain in an environment right now where rallies are getting sold, which makes it very difficult to trust strength to last beyond a day or two. That’s a tough market for swing trading (multi-day moves), aside from the fact that relatively few setups are even present in the charts.
My watch lists are pretty sparse at the moment, and that’s keeping me fixed on catching short-term moves and nothing more, at least until we see either (1) the market commit to a direction by exiting the wedge, or (2) the prevalence of more high-quality setups which point to longer-lasting moves.
Until then, it’s a day trader’s market, and for those who don’t prefer that timeframe it’s all about preserving capital until some better setups arrive. That could happen in a few days, so we’ll just have to see how things play out.
Tomorrow is options expiration day, which many think adds volatility, but which I interpret to simply be another factor at work to drive stock prices in different directions due to the impact of derivatives on common stocks.
Also keep in mind that as we enter these final days of the year, several other factors are at work which aren’t present the rest of the year. Those include portfolio managers exiting positions and adding others for the year-end books, tax-related selling for this calendar year, and of course declining volume at the end of the year as traders stand aside and tend to other matters (holidays with family and simply taking time off to gear up for 2012). With that in mind, it’s a good time to trade lighter and stay selective.
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!
Video Stocks Discussed: DOV, OPEN, GRPN, SFLY, CTRP
Swing Trading Candidates:
NONE TONIGHT
[table “187” not found /]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.
Catched your AGP trade idea today – entry over 54 with stops at 53.49 – worked out fine – thx
Would be nice if you could also mention in the videos f.e. how you managed a trade you have made on a day.
Regards
Achim
Achim, glad you made some jingle. I kept thinking it might sprint a bit higher, but with the overall market so sluggish it was just a modest winner.
The nightly video is a look forward for tomorrow. Additionally, I’m reluctant to be in the habit of discussing every day trade I took and how I managed them simply because it only adds minimal value. I don’t want my exits to be your exits, so the day trades are provided for traders who don’t mind determining their own exits. However, I’ll try to include some periodically to give you guys a look at my thought process on them.
Go get ’em Friday!
Yeah we got them. AGP huge winner and VRSN also ended up very nice. Took ok each and the little trend channel high.
Still hold 1/2 of both with a 1 day low stop for a possible swing.
Looks like V now wants to make a move, but VOL wasn´t that high on friday. Also nice setups AVID BWS CMC and FFIN.
Take care and let´s rock on monday. Have a nice weekend
Achim, glad to hear it! You worked the Bullish list for AGP, I like that & nice work. VRSN nice catch as well, looks good. I agree on V, it’s setting up but not really indicating a huge surge higher yet, so it’s one to be conservative with I think. You have a good eye with the setups you’ve listed here, thank you for sharing them inside the Hideout.
Tonight’s video will be out soon, go get ’em this week!