Good evening StockBandits!
Following a 2-day bounce on less-than-impressive volume and a quiet day of churning yesterday, the sellers returned to the Street today in full force. Pre-market weakness set the early tone, but no bounce attempt was ever made as the opening bell simply began a steady intraday downtrend with the indexes each undercutting last week’s lows to reach new depths on the current pullback. By the closing bell, the indexes had given up 3%.
Today’s move not only reminds us that the correction from the January highs is still underway, but the volume which accompanied it points to heavy distribution taking place. Light-volume pullbacks tend to occur during uptrends, suggesting only minor selling pressure is present. Right now, however, we have ample evidence that the institutions are raising cash quickly in expectation of lower prices.
It’s important that you and I as traders continue to respect this decline, because it may not be done yet. Today’s finish on the lows tells us the sellers simply ran out of time as they unloaded shares right up to the closing bell. Regardless, the change of character noted here a couple of weeks ago is still playing out, and that means there’s no room for attempting to call the low or buy perceived bargains simply because stocks are cheaper than they were. Stated otherwise, it’s an environment where cash is a great place to be, so I’m content tonight to have sidestepped this sharp decline.
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: F, UTX, AVY, LH, PVH
Swing Trading Candidates:
NONE TONIGHT
Bullish Watch:
EEV, TYP, SMN
Bearish Watch:
H, F, WLL, TECD, CAT, UTX, RINO, AVY, COH, DFS, ANR, BCS, LH, ARE, WYNN, AMZN, ED, RRD, RTH, PVH, AIG, LZ
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.
like the new site.
Jay