Good evening StockBandits!
Last week we saw some very interesting price action in the market, to say the least. It began with Monday’s downgrade of the US debt by Standard & Poor’s from Stable to Negative, sending stocks to new pullback lows off the early-April peak. However, by the end of the week we saw the NAZ and DJIA making new April highs. Upside gaps took place on the final 3 sessions of the week, with each of them followed by additional buying by the end of the session.
At this point, we now have technical proof of the emergence of the bulls (again), as well as some confirmation of higher lows on the daily charts of the indexes. The S&P 500 is just a couple points shy of clearing the prior bounce highs (from the March lows), and the RUT has a little ground to make up, but apparently this market is finding some encouragement from the earnings announcements we’ve seen so far. Many more companies have yet to report, so we could see the complexion change a bit in the days ahead. Some rest and digestion of this move wouldn’t at all be a negative thing, although the buyers are in gear and don’t seem eager to relent.
Volume sagged a bit on Thursday, but with a 3-day weekend and a sizeable move which preceded it, it was little surprise to see traders stepping away early or simply doing less ahead of Easter weekend. Things are sure to stay interesting in the coming days, as we have a 2-day Fed meeting on Tuesday and Wednesday with the announcement on interest rates and the accompanying policy statement at 2:15pm ET Wednesday.
Needless to say, it’s a time to stay on our toes and keep working the charts, just as we always do. That prevented us from embracing the recent pullback as a downside reversal, and served as a good reminder to keep an open mind in the market – especially when it’s such a news-driven environment.
For Monday: there will be no Broadcast as I have a personal engagement which will prevent me from producing the newsletter. Things will return to normal on Tuesday.
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: ANF, DKS, ICO, CCL, GOOG, EXK, MAKO, PRGO, PAY
Swing Trading Candidates:
PAY just pulled back for a few weeks but has maintained its overall uptrend. This looks like a potential buying opportunity, particularly if the stock is able to resume its trend. I’m watching for a push north of the descending trend line at $53.80 as a trigger for a buy. As with all swing trades, my stop and target levels for this stock are 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.
