Good evening StockBandits!
The NAZ is now up 156 points from its intraday low of just 7 sessions ago, and the buyers remain in charge. Today we saw the indexes follow a day of rest with some modest strength, taking the Big 3 to their best levels in years. More importantly, it counts as follow through to the breakouts we saw take place on Tuesday.
While the market run over the previous 7 sessions has been indeed impressive, it is not happening at a sustainable pace. The uptrend line during that time is visible clearly for the NAZ, and it’s quite steep. I’m not at all inclined to short into this move, but rather I’m just approaching it with some added caution as it gets a little longer in the tooth. I’m still focused primarily on the long side, but am eyeing abbreviated timeframes as we head into Friday’s option expiration session.
Many charts of individual stocks continue to need rest at this point, but even a day or two of sideways price action would do wonders for allowing some patterns build and further mature. My aim here is not to chase stocks which appear short-term extended, but to shift toward those which look ripe for a move as they attempt to catch up.
The big focus for Friday among the indexes will in my opinion be the RUT, which has yet another opportunity to clear the 833 hurdle it has faced for several weeks now. The small-cap stocks are the more speculative bunch, so should we see them finally start to participate in this move it could be very positive. Next levels are outlined in tonight’s video on the way up and they’re from July.
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: CRL, GTLS, EXH, YNDX, PLCM, DECK
Swing Trading Candidates:
NONE TONIGHT
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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.
Hi Jeff,
Recently you had an article in the Market Watch of the Wall Street Journal about TVIX. Is there any danger of staying with it too long? I get a little confused about the rebalancing they do on some of the ETFs. Obviously it has to go back up since stuff happens.
By the way, I had hung in with the swing trade of Whole Foods, and it hit the first target, $85.00 on 3/13. It did take too long, but I figured they are pretty robust so was willing to sit a lot longer than for some other company.
You do know they have a policy of not being over-solded? If you find a price that is higher elsewhere, they will match it and add on another 10% markup.
Best regards,
John
Hello John!
TVIX the only issue is that it’s a levered ETF so the longer you hold it, the more it tends to erode (Google for “Levered ETF Drift). When volatility pops, it will definitely spike, just a matter of from what level. It has made a new low on the daily chart so in my opinion it’s still working its way lower. I am out. Nice work on the WFM trade, glad it eventually paid you.
Go get ’em Friday!