Good evening StockBandits!
Yesterday’s afternoon bounce from the lows of the session proved to be a turning point as stocks vaulted further away from their short-term lows in today’s session. An opening gap to the upside was followed by plenty of additional strength, taking the indexes up through their descending trend lines on the daily charts.
This puts the market in an excellent position to rally further, but follow through will be the key. Today’s spike higher was the kind of kick-start needed to break free of the short-term pullback phase we have spent the past several sessions inside of, but one day does not a trend make. It may very well be day 1 of a new leg higher though, in which case the indexes would have ample room to run. I’ve noted lately how the descending channels and falling wedges were creating bull flags and pennants, and today those patterns were confirmed on the indexes. I’ll point out the next levels to keep an eye on down below in the charts.
In looking through many charts tonight, there are quite a few which look to be turning up from potential higher lows. The June lows were not quite tested for many stocks, giving us potential higher lows with the July pullback and this subsequent turn back up. Should this technical development be embraced going forward, we could see this market back up at the upper ends of the ranges in short order.
The setups in which I’m most interested for tomorrow’s session are day trades. I’m holding 4 swing positions on the long side tonight, and don’t mind adding more, but with the setups which look ready for imminent moves from here, there were interfering earnings dates as well as risk/reward profiles which just didn’t look suitable for swings. Instead, I’ll look to take them as day trades with 1% stops from entry and look to ride intraday momentum for 2-4% gains if they trigger tomorrow.
Tonight I’m going with the written format as I know some of you enjoy being able to skim the setups. As noted recently, I will be utilizing more written newsletters to compliment the videos. My notes and trade levels are provided on the charts below.
Please leave your comments and/or questions below if you have any, I always enjoy the interaction.
Swing Trading Candidates:
NONE TONIGHT
Day Trading Candidates:
These are the trades I’m eyeing for potential plays tomorrow. I will not be holding these overnight, and will wait for these levels to be crossed before entering trades. Please see the Day Trading Strategy for more details on how I manage these trades.
[table “88” not found /]
The Hit List will not be posted tonight as I am 100% cash overnight and there are no new swing trades for Tuesday. The Hit List typically contains stop and target levels for my swing trades.
