Good evening StockBandits!
Traders who got positioned for another Thursday meltdown in yesterday’s closing weakness woke up to a big surprise this morning as the indexes gapped higher by about 2%. Rather than seeing the early strength used for raising cash though, today we saw it get added to. The initial response was a rather choppy trading range into mid-day, with no selling but limited additional upside. But as the afternoon arrived, the buyers got back in gear and propelled the indexes to their best levels, taking stocks out at their highs when the closing bell finally rang.
Turnarounds have been no surprise in this market, as we’ve seen them occur regularly of late in both the daily and intraday charts. Commitment has been a difficult thing in this environment, and it seems as though stocks can hardly stay moving the same direction for more than a few hours – particularly on the upside. We’ve yet to see two consecutive days of strength in nearly a month (since April 29th).
In recent days, multiple tests of the downside have established some closing support zones, although the intraday action as viewed in HLC bars shows a lot of erratic moves. Nonetheless, the indexes have been able to close consistently above the May 6th ‘flash crash’ lows, helping to create some support in that area. That may be enough to prompt a good rally, and today was a good start, but the verdict isn’t in yet. The first thing we’ll need to see is follow through.
Tomorrow is a Friday ahead of a major holiday (the market will be closed on Monday in observance of Memorial Day), so today’s light volume may be slightly attributable to that. We could see quieter action tomorrow as well, as many are starting vacations and schools are getting out. As a result, I’m looking to take it pretty easy, but there are a few plays on my radar which I’ll discuss in tonight’s video.
As a reminder, the next Bandit Broadcast will be posted here on Monday night since the next trading session will be Tuesday.
Please leave your comments and/or questions below if you have any, I always enjoy the interaction.
Here is tonight’s video:
The Bandit Broadcast Video – Click to Watch!
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Video Stocks Discussed: GLD, ABX, GG, CSTR, CAB, SHLD, DO, V
Swing Trading Candidates:
NONE TONIGHT
Bullish Watch:
CSTR, NTRI, VCI, ORLY, HOT, NAV, SPRD, CAB
Bearish Watch:
DO, ABX, V
The Hit List will be coming out soon with discussion on open positions and swing trade stops and targets, so be sure to watch for it.
