Good evening StockBandits!

The sell-the-news scenario I discussed as a possibility here on Thursday night came to fruition Friday morning as the reaction to the jobs number left stocks heading lower in a hurry.  The futures spiked lower, bids disappeared, producing a sizeable downside gap in the major indexes at the opening bell.  That was the move of the day, and it took place outside of market hours.

No real attempt was made to fill the gap for the first several hours of the day as the market spent those in a choppy range.  Then the final hour of the day arrived, and we saw a modest lift out of the range into the closing bell, erasing a fair amount of the morning losses.  Nonetheless, in the end it was a down day, which this market actually needed.

While the bulls may balk at the notion of lower prices being a good thing, the fact of the matter is that this market badly needed rest.  The NAZ 100 had tacked on nearly 9% in the previous 8 sessions, which is clearly an unsustainable pace to maintain.  Lower prices are actually a positive for both camps, as they allow bears to cover at better levels while the bulls who want more long-sided exposure are able to step in and buy the dip.

The big question at this point is how far this dip carries.  Is it a one-day selloff?  Is this the start of a multi-day decline that will spook out anyone who went long in the past few days?  Those are good questions, and since my battery ran down on my crystal ball, I’ll have to simply defer to the charts and go with the patterns and levels I see.  We’re sitting shy of the May highs, which could pose a threat to the short-term health of this rally.  Therefore, in the bigger picture we’re back up to the upper end of a multi-month trading range, still overbought.

My plan for this next week is to take it pretty easy on the front end, then if we see some consolidation and bases begin to form on the charts, there should be some good opportunities for adding more swings to the day-to-day cash-flow day trades.

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: NTES, OPEN, X, SOHU, FSL, ATI, GGC, VIT, P, EL, IPI, ANR, CIEN

Swing Trading Candidates:

NONE TONIGHT

[table “81” 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.

Trade Like A Bandit!

Jeff

Good evening StockBandits!

The market melt-up continued today as the NAZ and S&P 500 both added more than another percentage point to the run which started a week ago Monday.  I’ve noted here recently that this pace is unsustainable, which it actually is, and yet it’s still going.  What’s perhaps so interesting here is that those who have been long are now wondering if a quick trade on the short side is reasonable, while at the same time those who are short are considering caving in and going long just to avoid the daily punishment of being on the wrong side.  Clearly it’s a very interesting time right now.

Technically, this ramp has pushed the indexes beyond prior support levels which were expected to serve as at least temporary resistance.  However, those areas have been ignored as the buying persists.  We’re now not far at all from the May highs which seemed like such a long way off just two weeks ago.  This market over the past two months has been alot like springtime weather here in Texas…if you don’t like the conditions just wait a little while, because they’re likely to change.

With the market being extremely extended here, it’s important to be on watch for a potential short-term pullback.  That may not evolve into an all-out reversal, but it would be quite healthy after a run of this magnitude and is becoming more likely by the day.  Tomorrow morning in the premarket we have economic news with the Nonfarm Payrolls number which could produce a knee-jerk response, and given all the positivity of the past 8 sessions, a sell-the-news reaction isn’t out of the question.  I’m sticking with day trades for new positions tomorrow with that in mind, as well as the fact it’s a summer Friday (typically lighter volume) and there are very few quality patterns to choose from in the charts anyway after this rally.

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: ZIP, P, VMC, MOS

Swing Trading Candidates:

NONE TONIGHT

[table “80” 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.

Trade Like A Bandit!

Jeff

Good evening StockBandits!

Buyers stepped in again today to defend even a minor pullback this morning, taking the indexes into positive territory where they stayed for the afternoon.  The highs were made in the early afternoon, but the market didn’t give back much ground despite some late-day churning.

The indexes are still contending with some key areas, and considering they’re still somewhat extended, this would make for a logical spot to put in some rest.  The issue is that of late, logic hasn’t driven the moves, as traders have been gunning on emotion instead.  Regardless, the S&P 500 is respecting the 1341-1345 area, while the NAZ is sitting just shy of 2835 from the May 31 high.  Volume is still running light, which has been expected this week of July 4th.

My watch lists are still pretty sparse, although even a couple of days of rest would do wonders for creating some bull flag and pennant types of patterns.  In the meantime, I’m doing my best to stay patient and stick with the best setups from the charts each evening.  Today offered a couple of swing entries which I’m sitting in overnight, which is nice.  I’d like to see more setting up in the coming days to go along with the day trades we’ll no doubt see, but the key will be if this market is able to either pull back in a shallow fashion or simply sit still for a couple of days.  That may make for some low-key price action, but for a longer timeframe it could easily serve as the pause that refreshes.

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: GNK, CREE, JDSU, PCX

Swing Trading Candidates:

NONE TONIGHT

[table “79” 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.

Trade Like A Bandit!

Jeff

Good evening StockBandits!

Finally we saw stocks take a breather today with minor net changes and mixed results.  That equates to a well-deserved day of rest for this market which has been running nonstop since 6/27.  Today’s action (or lack of it) was a welcomed sight for those of us eager to see stocks begin basing and digesting this big run.  Today may have been the start of that.

Generally speaking, the sharper a move is, the more prone to reversal it becomes.  However, it’s a little more tricky when we see one-way moves which carry as far and last as long as this one has.  When that’s the case, it has a different effect than the usual 1-2 day spikes which often are met with an abrupt pullback.  In this kind of a situation, it catches so many off guard, that defense is the only response.  That means shorts who got caught on the wrong side of this move are quick to cover in hopes of repositioning at another level, and underinvested bulls feel the need to play catch up by putting cash to work on virtually any dip.

Whether we see that play out this time around remains to be seen, but my gut tells me this has potential to be that way.  Stated otherwise, I’m expecting some rest and a pullback, but not a quick return to the June lows anytime soon.  Instead, I’m interested in seeking out some upside continuation plays and will only short stocks which have proven to be weak despite this impressive rally.

Lately I’ve been patiently waiting for individual stocks to set up for good multi-day moves, and particularly those with some defined risk associated with the pattern.  Although the market has made a big run higher, few stocks have met that criteria.  We’ve also been in a highly volatile environment with many wide-ranging days and more frequent overnight gaps.  That has added to the difficulty of not only locating such plays (as it has led to very sloppy charts), but it also makes managing risk effectively much less possible.

Tonight, there are several setups which are working on quality patterns, including some long-awaited swing trading candidates.  I love to have capital at work across multiple timeframes, but the erratic nature of the market of late has simply prevented me from taking overnights.  With the dust starting to settle, and with plays which look appropriate, I’m willing to take swings once again in addition to the cash-flow types of day trades I’ve been focused on (speaking of, did you grab TSCO from last night’s Broadcast?…it was a day-maker).

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: VRX, TITN, PANL, JDSU, WDC, CREE, SWKS, AEM, NOG

Swing Trading Candidates:

AEM sold off for several months before spending the early part of this summer attempting to stabilize.  Last week this stock may have created a higher low just after establishing a short-term higher high, making this an upside reversal candidate which could quickly gain interest.  I’ll be going long if this one clears the trend line at $63.65.  As with all swing trades, my stop and target levels for this stock are on the Hit List here inside the Hideout.

Chart courtesy of TeleChart

NOG corrected in a steady fashion until a couple of weeks ago when it established a higher low.  The stock then rallied past a short-term high to change its trend, and now sits in a bull pennant pattern with potential to run further.  I’ll be a buyer if this one clears the upper trend line at $22.50 on its way to higher levels.  As with all swing trades, my stop and target levels for this stock are on the Hit List here inside the Hideout.

Chart courtesy of TeleChart

[table “78” 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.

Trade Like A Bandit!

Jeff

Happy July 4th StockBandits!

Fireworks arrived well ahead of schedule as last week the indexes vaulted higher in a nonstop fashion to reach new recovery highs off the June lows.  Multiple key levels of former support were reclaimed on the way back up despite quieter volume than we’ve had of late.  That was likely due to this being one of the two quietest volume weeks of the year (along with Thanksgiving), but it didn’t stop the buyers.  Upside gaps saw no attempt at getting filled, as profit-taking was delayed in favor of chasing momentum and shorts anxiously covering to get out of the way of a runaway advance.

The rebound accomplished quite a bit, both from a psychological and a technical perspective.  Psychologically, the bulls reasserted themselves to produce nearly a full recovery of the early-June slide, reminding the bears that they don’t intend to completely walk away at the first sign of a selloff.  Technically, levels which were expected to pose as resistance were entirely ignored as the buying never relented.  We left the low-level trading ranges of the previous 3 weeks, ,and then ripped right through important levels on the way back up. No matter what happens next, we’re virtually guaranteed to see some additional battles between bulls and bears in the months ahead.

The big question on everyone’s mind is “what happens next?”  One could easily make a case for overreactions in price in both directions over the past several weeks, and it’s hard to dispute that.  Methodical moves tend to last the longest, yet this market has shown nothing of that sort lately.  The most reversal-prone moves are the sharpest, and we’ve certainly seen that in recent days.  Just how far the next pullback carries remains to be seen, but we can bet that it’s coming after this straight-up run.

Individual stocks for the most part continue to exhibit sloppy charts.  That’s understandable considering we saw a waterfall-like selloff followed by a few weeks of volatile indecision, then a violent rally right back up.  Fortunately though, that’s a temporary condition and things will smooth out.  Quite a few stocks have recovered to an extent that they’re probably safe from complete breakdowns for at least a little while.

Should the major averages (and of course individual stocks) remain inside these multi-month very wide trading ranges (found between the March/June lows and the May highs), it’s going to continue to make this a trader’s market for a while.  Subsequently, working the charts on a regular basis and considering risk for every new trade is going to be critical until we exit the range.  That spells opportunity, so long as we stay on our toes and wait for quality setups to emerge.

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!

–

Video Stocks Discussed: TITN, YOKU, MOBI, TSCO, PLCM, WLK

Swing Trading Candidates:

NONE TONIGHT

[table “77” 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.

Trade Like A Bandit!

Jeff

Good evening StockBandits!

Despite the run of the previous three sessions, the bulls didn’t back down at all today as they propelled the major averages to new recovery highs.  Each of the big three indexes added more than 1%, which is no small feat considering they were becoming a bit short-term stretched before today’s session even started.  Nonetheless, the buyers have momentum right now, and on a light-volume week ahead of a major holiday, nobody seems interested in getting in the way.

The issue here from not only a technical but also a psychological standpoint is simply finding entries.  Most names have seen considerable volatility in recent weeks, then have abruptly turned higher over the past few days and now are in no-man’s-land when it comes to tradable setups.  Toss into the mix that tomorrow’s a mid-summer Friday in front of a 3-day holiday weekend, and we could see some quiet activity as the market digests this move and traders step away to fire up the BBQ or hit the pool.

I’m looking at a few day trading candidates for tomorrow, which I’ll outline in the video.  There remains a distinct lack of setups for swing trades right now, so until we see things settle down and aren’t seeing daily triple-digit moves, the most appropriate way to manage risk is via shortened timeframes.

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!

–

Video Stocks Discussed: DE, MELI, P, CTSH, MTL

Swing Trading Candidates:

NONE TONIGHT

[table “76” 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.

Trade Like A Bandit!

Jeff

Good evening StockBandits!

The bulls maintained respect today as well as their recent momentum as they stepped in to provide support this morning.  A positive start was met quickly with selling as the morning gap was filled and two of the three major indexes went negative.  The sell-the-news response to the events in Greece, combined with overbought conditions from a couple of trend days higher could easily have produced a sizeable reversal to the downside.  Instead, the bulls continued their run with another solid advance.

Volume remains light, but that’s to be expected around July 4th (this next Monday), as that’s usually one of the two lightest volume weeks of the year.  We could see continued quiet volume for Thursday and Friday as traders lock in gains ahead of the long weekend and step away to travel or simply hit the pool and the BBQ grill.  That means we’ll have to focus on price until at least next week, and possibly the second week of July.  Price is of course always most important, but my point is that we can place less importance on volume activity right now due to the seasonal influence of July 4th.

The market is a bit short-term stretched here, but the bulls have momentum and don’t seem intent on relinquishing control just yet.  After seeing important support held in June and then this rally, we may face some opportunities to buy dips once stocks take a breather.  Shorts have been hit on this advance and will be looking to cover, and underinvested bulls will be adding exposure in case we’ve just seen a low that’s able to stick.

Tonight in the video I’m going to take an extra few minutes to explain a couple of lessons tied to two of last night’s day trade candidates.  My hope is that you can learn something from it before we get to tomorrow’s plays, as the aim here is to help you grow and learn continually.

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!

–

Video Stocks Discussed: ZAGG, RBCN, AG, WNR, CTSH, JDSU

Swing Trading Candidates:

NONE TONIGHT

[table “75” 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.

Trade Like A Bandit!

Jeff

Good evening StockBandits!

Today arrived with something unusual in tow:  follow through.  After Monday’s rally back up toward the upper ends of the recent trading ranges, the stage was set for either another failure at resistance or a push through, and the latter is what we got.  A positive start never saw profit-taking, and the market trended higher intraday to finish right at its best levels of the session.

From a technical standpoint, few would have been surprised to see some ground given back today after yesterday’s light-volume rally.  That hardly seemed the ideal scenario for a push back up and out of the trading range of the past few weeks, yet that’s exactly what happened.

It was positive for the indexes to reclaim some important short-term levels, but there’s still plenty of work yet to be done by the bulls.  We’ll need to see some follow through sooner or later, as well as some stronger volume to help confirm this move.  In the coming weeks, we’ll also need to see some sort of a higher low established on the daily charts of the indexes, as that will really help to create some interest on the long side.

The verdict is still out as to whether this is simply end-of-the-quarter window-dressing, or some actual buying and accumulation.  One thing is for sure…with the July 4th holiday just a few days away, we’re approaching typically the lightest-volume weeks of the year.  That doesn’t suggest we’ll see a big pick up in activity, so the jury may be out until once that milestone has been passed.  Price will have to be the focus until then.

The charts of individual stocks remain quite sloppy with all the recent back-and-forth, so my watch lists are still quite limited.  I’ll be focused on a handful of short-term plays for Wednesday’s session.

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!

–

Video Stocks Discussed: LAVA, ZAGG, SQNS, MOS, RBCN

Swing Trading Candidates:

NONE TONIGHT

[table “74” 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.

Trade Like A Bandit!

Jeff

Good evening StockBandits!

Right on cue, the market followed a weak Friday with a strong Monday, continuing the back-and-forth range-bound price action we’ve seen so much of lately.  And it was another rather convincing rally from a price perspective, with the NAZ adding 1.3% on the day.  However, it’s again important to remember that we’re still beneath key levels (as discussed in tonight’s video), as well as the fact that today’s advance came on lackluster volume – particularly compared to Friday’s selling.

So, the trading ranges are still intact for now, and volatility continues to be elevated with the frequent gaps and wide-ranging days.  Tomorrow the bulls have a shot at reclaiming some important levels, but they’ll have to prove it if they want to propel this market out of this short-term range.  If they don’t, we could see yet another slide back toward the lower end of the range.

It’s a trader’s market right now, but really and truly just for day traders.  The limited follow through and frequent overnight gaps have prevented much opportunity from a multi-day swing trader’s perspective, which means cash continues to be a good thing to have on hand.  Eventually we’ll leave this range, but until then we should expect more of the same.  Stated otherwise, let’s require that the market prove it’s back on the move rather than chasing a rally or selloff and hoping that this time it’s going to see follow through.  At some point it will, but so far it’s been false-alarm city and that’s a good reminder to stay on our toes.  I’m sticking with day trades tomorrow for that very reason.

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!

–

Video Stocks Discussed: OPEN, ONTY, MCO, RBCN, CIEN, CREE

Swing Trading Candidates:

NONE TONIGHT

[table “73” 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.

Trade Like A Bandit!

Jeff

Good evening StockBandits!

Indecision continues to run rampant on Wall Street, as the bulls and bears have been taking turns grabbing the steering wheel of this market lately.  One day we ramp higher, the next we sell off hard, with both moves being delivered in a convincing fashion.  Such was the case last week as the major indexes zigged and zagged back and forth, ultimately finishing mixed.

The truth is that until the current trading ranges get broken, we could see plenty more of this kind of price action.  That’s simply the nature of trading ranges, which is what this market is currently dealing with.  We do have some higher volatility at the moment, which is producing more frequent overnight gaps as well as more wide-ranging bars on the daily charts, but the bottom line is that the tape is best characterized by indecision.  Anytime that’s the case, follow through is fleeting and the market tends to exaggerate its response to every headline which crosses the wire.

I noted recently that “the mood has shifted decisively from a buy-all-dips mentality to a sell-all-bounces reality…that will take some time to heal, so our expectations for lasting upside should be set accordingly.” That’s still very much the case, particularly as long as we remain beneath key short-term levels like 2705 NAZ, 1294 S&P, 807 RUT and 12100 DJIA.  Beyond those levels, there’s plenty more overhead to contend with, but for now those are the areas where sellers have been camped out.

Now for some encouragement!  First, my watch lists are beginning to expand once again, which is to say more stocks are attempting to set up for trades.  Second, we know this market won’t be dipping and ripping in this range forever, so every day spent inside it not only verifies the levels but brings us one day closer to the next meaningful move.

The market remains in correction mode for now.  It’s imperative that we keep an open mind to what may come next, whether that’s a turn higher or a continued slide toward lower levels.  Being short-term traders, we have the flexibility to stay sidelined when conditions warrant (like now) or participate on either side of the next move.  The key right now is not getting committed for more than a few hours, at least until we see these ranges left behind one way or another.

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!

–

Video Stocks Discussed: GNOM, UA, FIO, P, VIT, JDSU

Swing Trading Candidates:

NONE TONIGHT

[table “72” 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.

Trade Like A Bandit!

Jeff