Good evening StockBandits!
A gap-up-go-up day caught shorts by surprise today as stocks bounced big. Pre-market strength was buoyed by encouraging economic data, and with stocks having held above the lower end of the short-term trading range, the stage was set for a lift. That’s exactly what we got, with the indexes flying back to the upper end of the range in today’s action.
Both bulls and bears alike have been conditioned in recent months to buy dips, as we simply haven’t seen any downside gain traction. The pullbacks have nearly all lasted just a day or two, and have quickly been followed by more strength. Bulls are stepping in to accumulate on weakness and put cash to work in order to avoid feeling left behind. Bears have been torn to bits and are on shaky confidence, leaving them prone to covering shorts quickly after catching even a small decline. That combination of both sides being buyers on weakness has maintained a persistent bid beneath this market, and today that certainly played a role.
What’s still unclear at this point is whether this market has made its highs for now, or if we’ll soon set more new 52-week highs. The pullback last week saw a failed bounce and a quick turn lower this week, which made for the first attempt at downside follow through we’ve seen in quite a while. We’re still dealing with the short-term trading range I’ve highlighted here the past couple of nights, so the jury’s still out for now. Tonight we’re back at the upper end of the range, so tomorrow could prove to be a pivotal day.
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!
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Video Stocks Discussed: KSU, SBGI, HS, POT, TTWO
Swing Trading Candidates:
TTWO has pulled back only slightly from its recent high, and put in some needed rest to digest the February run. This stock is now challenging the upper trend line of this consolidation, and may be ready to go soon. I’ll be going long if this one clears the trend line at $16.30. As with all swing trades, my stop and target levels for this trade are found on the Hit List here inside the Hideout.
Bullish Watch:
SRZ, MCO, KSU, CLR, KEG, TXN, SGY, PLCM, RDC, SBGI, IO, SKH, HS, CVX, XOM, COP, COG, NDAQ, CHS, NOG, OII, RRR, MFC, TTWO, IT, ICO
Bearish Watch:
AA, IVN, F, LVS, POT, HPQ
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.
