Good evening StockBandits!
The seemingly nonstop rebound off the recent lows continued today with a strong open being followed by additional buying. That took each of the major indexes to new recovery highs, and in the case of the RUT to new 52-week highs.
Volume improved slightly with today’s action, although it remained below-average. That has been a glaring technical concern throughout this bounce, yet the buyers are still driving prices higher – whether bulls putting capital to work or bears in desperate need of covering short positions.
The bounce is approaching melt-up pace at this point, but it’s important to remember that even though price is quite stretched here, some stocks will still see rotation in the coming days. The trick to playing a bounce like this is to participate in names which aren’t yet extended, so that’s my plan for new buys heading into tomorrow. I’m still going to keep a close eye on potential short setups, because at some point this rally will relent, but for now it seems traders are doing their best to get positioned for another possible start-of-the-month advance (which could occur Friday) like we’ve seen so many times recently.
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: MEE, STJ, MCHP, ICO, MTZ, PXP, CVC, SM
Swing Trading Candidates:
SM continues to base beneath resistance while maintaining its uptrend. A breakout with a push through resistance at $75 could free up this one to move higher, so I’ll be going long if that level is cleared for a swing trade. As with all swing trades, my stop and target levels for this trade are found on the Hit List here inside the Hideout.
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.
