Good evening StockBandits!
The indexes gapped lower to start the week, and the buyers emerged once again as support zones were tested and held. That provided a decent lift from the opening lows, and each of the averages moved into positive territory except for the NAZ. The bounce was unable to persist, however, and by late morning the market started working its way lower. We trended down in the afternoon in an orderly but steady fashion, leaving the S&P 500 and NAZ beneath key support zones.
To see those zones get defended multiple times in the past couple of weeks, only to fail today, gives today’s break some validity. Time will tell, but for the time being we have a downside resolution to the recent indecision, and that’s not a technical event we want to take lightly. This appears to be the market’s way of following the leaders we’ve recently seen break down (AAPL, BIDU, SOHU, NTES, UA, OPEN, to name a few), so the big question at this point becomes “where do we stop next?”
There’s no easy answer to that, but we do have some levels to keep an eye on if/when we approach them, which I’ll cover in tonight’s video. Suffice it to say though, cash is a good thing to have on hand right here as the market threatens to correct further, and it’s important to remember the role which good defense plays for us as traders. Capital must be protected first and foremost, with profits being a secondary objective. We’ve caught some good moves on the short side since last week, but if the pullback continues, we should see plenty more opportunities in the days and weeks ahead.
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: VNO, XOP, XLE, APC, HP, XEC
Swing Trading Candidates:
NONE TONIGHT
[table “45” not found /]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.
We have a hostage situation where both sides are using the market/economy to achieve their own agendas. Makes the best sense to stay away from the foolishness.
I am going to stay hunkered down with some GLD and SGOL and protective puts till the storm passes. Ironic that today we passed the way point into insolvency.
I agree, it seems the argument is being spun to benefit both bulls and bears. Gotta defer to the charts anytime that happens to truly locate the ‘correct’ side, and at the moment we are breaking down. Defense is imperative in trading!