Good evening StockBandits!

Stocks came under significant pressure again this morning as crude oil took a big hit, reaching levels not seen since February.  The blue-chip averages have exposure to major oil, which left them deep in the red early in the session.  Add that to the fact that Bernanke & Co. offered nothing of substance yesterday to suggest things are improving on the economic front, and traders woke up in the mood to lighten exposure.

By mid-morning, last week’s lows had come into view with the S&P 500 and DJIA each getting within just a few points of those levels.  Fortunately for the bulls, that’s right when the buying kicked in.  Aggressive bulls put cash to work, likely using support as their line in the sand, and bears moved to cover shorts quickly into the weakness.  That combination produced a grind higher into the early afternoon before one last pullback was made just to be sure the lows would hold.  They did, and stocks spiked higher and rallied once more with vigor into the closing bell.

Today’s volatility is exactly the kind of price action we expect to see within trading ranges like the one we’re currently in – and particularly near the lower end of the boundary.  Follow through is hard to come by, and emotions in general have been running higher of late.  That raises the propensity of the market to reverse suddenly, which keeps traders on both sides very attentive.

It’s likely that in the days ahead, we can expect more of the same until this trading range is left behind.  It’s easy to get worried about yesterday’s late selloff or excited about today’s rebound, but the fact of the matter from a technical standpoint is that this is all simply noise.  Price is fluctuating, at times violently, within defined trading ranges, and that means we’re still on hold waiting for technical reasons to trust this market for some follow through.  We’ll eventually need to either undercut the lows and head further south, or reclaim former support and start creating some higher lows on the way back up.  Until then, follow through will be fleeting.

My watch lists remain rather anemic, which is a fair tell right now that there’s just not many names in play when it comes to constructive price patterns.  I fully expect that to change sooner than later, but for now it’s a reminder to stay selective and keep timeframes short while we wait for some smoother conditions for swing trading.

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: KKD, ELN, PLCM, VIT

Swing Trading Candidates:

NONE TONIGHT

[table “71” 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!

Following a multi-day bounce from major support (NAZ), the buyers had justification to take a break today.  Things started out rather quiet but positive, then leveled off mid-day.  As the afternoon progressed, however, we saw sellers emerge to take away not only the entire morning gains, but considerably more.

Seeing the market limp into the close the way it did today will no doubt bring about some concern for those who are long.  The fact of the matter is that very few nailed the rebound, so most of those who are long have been long for a little while now – and quite likely from higher levels.  With that said, the bounce was a bit of a relief for them (hence the name ‘relief rally’), and they’re now back to doubting their positions.

This pullback is the one that I’ve been eager to monitor, as we all knew the market would at some point bounce.  The bounce itself wasn’t what was important, because a stretched rubber band will snap back.  Rather, this is the pullback where we find out if those who were putting cash to work over the past few sessions were simply covering shorts, or if the underlying character has again shifted.

Should this pullback bring about an all-out break of last week’s support, that would of course be a failure and therefore another major sell signal.  However, if it remains somewhat shallow and the buyers keep it propped up above support, then we may be staring at an opportunity on the long side with a move back up from held support.  Needless to say, the next day or two could be quite interesting.

I’m sticking with abbreviated timeframes (ie: day trades) for Wednesday due to the unstable condition of this tape.  Today we saw another example of the benefit of that with the short-lived move in VHC, which I’ll point out in the video.

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: VHC, JVA, NVDA, DANG, MCO

Swing Trading Candidates:

NONE TONIGHT

[table “70” 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!

Just a day after a light-volume, minor advance, the indexes surged higher today as buying pressure returned.  A small upside gap saw only a brief attempt at a fill, but prices turned quickly higher and we saw a steady ramp into the afternoon.  Although the pace of the run cooled off later in the session, it was still an impressive trend day which alleviated some of the pain bulls have endured recently.

Despite today’s sharp rally, this market remains in a precarious spot on a technical basis.  Key support was last seen just a couple of sessions ago, and we are still a very long way from even the prior swing high set on May 31.  Well beyond that are the highs from May 2, so there’s no shortage of overhead levels this market will have to contend with on the way back up.  That is, if it continues to go back up.

Psychologically, bulls have suffered a loss of capital on this pullback as well as a loss of confidence, as seen in the shift to a sell-all-rallies environment in recent weeks.  That’s not going to be reversed easily, which means the battle could rage on for a little while between bears and bulls.

In the short term, this market may face continued volatility with a fixation not only on the situation surrounding Greece, but also tomorrow’s Fed day comments from Bernanke regarding the economy.  Clearly, there’s a lot going on right now on the psychological and technical fronts, as well as with anticipation of the news flow.  That’s likely to keep things somewhat unstable, so it’s of utmost importance to continue to manage risk in this kind of environment.  Missing a trade is one thing, but getting run over by incorrectly anticipating a move is far more costly.

One other note is that I had intended last week to introduce a new feature here which I’ll periodically do, but the market simply isn’t conducive to it at the moment.  My plan is to do some Video Chart Reviews by request, whereby you Bandits submit stocks you’d like to see me review and I’ll run through them in video format and discuss what I see in the charts.  With my own watch lists about as sparse as they’ve ever been, my concern is that I’d sound like a broken record reviewing your stocks right now (repeating something along the lines of “I don’t see a clear setup here in either direction.”)!!  So, I’ll give it a few more days and then give you a heads-up when the trading environment appears ready for that, and hopefully it’ll be of benefit to you.

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: ZAGG, VHC, SQNS, VPRT, FLS, ADBE

Swing Trading Candidates:

NONE TONIGHT

[table “69” 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 recovered somewhat quickly from a poor start this morning, erasing a small downside gap to move into positive territory.  The first pullback brought the market slightly negative again, but it also produced a higher low from which the market rallied.  While things did level off later in the day, the indexes were able to post gains for the third consecutive day.

The issue with the state of this market right now is that after three consecutive advances, the indexes are still beneath some important levels (which I’ll point out in tonight’s video).  That may in itself limit the magnitude of this rally, which means it could fail with relative ease should we happen to see selling pressure return.

One other problem with today’s rally was the fact that volume was quite light.  That points to very limited firepower on the buy side at this point, and suggests there’s little conviction that this bounce will stick.  That still remains to be seen, and it’s possible that a continued rally from short-term support zones could take place, but so far the long side appears to have limited appeal.  Shorts are in little hurry to cover, and the bulls are still gun-shy after weeks of losses.

My watchlists tonight are notably sparse.  Sometimes that’s the case, and it will certainly change, but that’s always a pretty good indication to me to keep my risk in check until there’s a greater abundance of opportunity.  As a result, I’ll be a day trader tomorrow with just a handful of candidates.

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: NOC, FTO, HOC, NTES, TEX

Swing Trading Candidates:

NONE TONIGHT

[table “68” 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 Father’s Day StockBandits!

The indexes finished last week mixed, as the NAZ lost more ground while the S&P, RUT, and DJIA did their best to stabilize after nonstop recent weakness.  The S&P broke its 6-week losing streak, although only by 0.52 points, which of course failed to impress anyone.

That’s a great example of how the upside has been in this market for the past few weeks, as attempts at rallies have not only failed to close near the highs of those sessions, but we’ve seen selling pressure immediately resume, keeping a lid on rally attempts.

Volatility has picked up as well, which is evident with the VIX advancing from the mid-teens to the low-20’s.  On a more practical measure, however, we’ve seen more frequent opening gaps in both directions, some wide-ranging bars, and plenty of intraday reversals as well.

Clearly, it’s a tricky market at the moment.  The short side has been a difficult one to trade, as the turn lower came on a big reversal day and we’ve not seen a clean second-chance entry emerge since then with the relentless selling.  On the flip side, the number of stocks which were exhibiting bullish characteristics on a technical basis have fallen victim to widespread selling, negating nearly all those patterns which had been building.

This doesn’t so much spell doom-and-gloom for us as traders (no setups!), but instead it reminds us of the importance of shifting to the sidelines when few opportunities exist (protection!).  Our ability to maneuver quickly as individual traders is a huge advantage at all times, and particularly during correction phases like this one we’re reminded that the safety of the sidelines is always available to us for purposes of protecting both our actual and psychological capital.

Emerging from a market pullback with cash on hand and confidence which isn’t shattered puts us miles ahead of those who now need to dig out of a hole in their account (and mentally), allowing us to capitalize on opportunities when they begin to return.  That could happen at any time, but at the moment caution is still warranted, so I’m sticking with a day trading timeframe heading into Monday’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!

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Video Stocks Discussed: BIG, ZAGG, JNPR, DECK, OPEN

Swing Trading Candidates:

NONE TONIGHT

[table “67” 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 big question on the minds of many after Tuesday’s rally was ‘how far will this bounce carry,’ but I noted the importance of the next decline as the biggest tell for this market.  I didn’t expect to see it happen so quickly, but today we got that answer with a decisive move lower which easily erased yesterday’s gains.

The quick evaporation of Tuesday’s gains (and hope of the bulls) reminds us that it’s been some time since we saw any upside follow through in this tape.  In fact, we’ve yet to see two consecutive advances since late-May.  The last two times a bounce was this quickly erased, we still had more to go on the downside, so continued caution is certainly warranted here.  Stated otherwise, the hero trade remains very out of style, as all attempts at catching the low have thus far failed to produce anything but account damage for those trying.

The S&P 500 has the March low at 1249, and that level’s now just a little over 1% away from tonight’s close.  It could be that we need to undercut that level and flush out the bull holdouts before a bounce is able to stick.

I’m still averse to overnights, particularly with the sizeable gaps we’re now seeing occur more frequently.  That makes it even more difficult to manage risk in a market which remains very oversold yet continues to gain no traction on bounce attempts.  A bounce which matters will eventually occur, but keep in mind that the farther we go down, the higher the number of bulls who become trapped on the long side who will want out on subsequent rallies.  That, combined with the growing confidence of the bears, will likely keep things tricky after the initial bounce kicks in.

** On another note, I’ll be at the Trader’s Expo in Dallas on Thursday through Saturday. If you’ll be there, let me know! Also, there will be no Thursday evening Broadcast this week.

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: TZOO, ARIA, QIHU, IDCC, RAX

Swing Trading Candidates:

NONE TONIGHT

[table “66” 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 much-anticipated relief bounce finally arrived today, and by comparison to last Thursday’s attempt, this one was valid.  A gap up this morning had shorts on the run, and we saw a steady push higher as the morning continued.  Mid-day the market held onto its gains, then pushed to new session highs in the afternoon.  And although we did see the market give back a few points in the final hour (as it’s so accustomed to doing of late), it wasn’t much and the gains of the day were maintained quite well.

All the steady downside pressure of late has kept traders largely frustrated.  Pretty much anyone who understands risk recognized that if you didn’t nail the beginning of the move, it was extremely hard to jump on board and participate on the short side.  Likewise, today’s rally reflected that, as yesterday’s weak finish offered no clues we’d gap so significantly today.  That made the strong open difficult to buy, particularly since we’ve seen a number of upside gaps get quickly filled, frustrating less-aggressive bulls who had intended to buy the turn.

So tonight, the big question on the minds of most is “how far does this carry?”  That’s a valid question, and I’ll cover that in tonight’s video, but another issue is perhaps more important:  what happens on the next decline?  However far this bounce carries, the next wave of selling is going to tell us the most about the state of this market.  If the next dip remains shallow, then there’s a higher shot at these lows sticking.  But if the relentless downside pressure returns on the next pullback, then we could easily see this bounce fail like the others in recent weeks.  That places the highest importance on the next pullback, and not necessarily the magnitude of the current relief bounce.

** On another note, this week I’ll be at the Trader’s Expo in Dallas. If you’ll be there, let me know! Also, there will be no Thursday evening Broadcast this week.

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: MCO, CDE, TZOO, GLNG, CREE, IDCC

Swing Trading Candidates:

NONE TONIGHT

[table “65” 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!

Following 5 straight weeks of declines, many were looking for a market rebound last week.  Technically, we had seen support levels coming into view which could produce a bounce (NAZ 2705, S&P 500 1294).  Instead, they were undercut and left in the rearview mirror while the market headed south for the 6th consecutive week.

Psychologically, the traders’ mindset of fading streaks was acted on by some in hopes that oversold conditions would revert to the mean.  The action proved to be mean alright, but not in the way those bulls had hoped.  What we saw was more downside pressure until a dead-cat bounce arrived on Thursday.  Even then, a poor finish tainted the rally, indicating that it was not to be trusted.

Friday’s hard selloff put an exclamation point on the week for the bears, as Thursday’s gains were quickly erased and much more.  In the end, the NAZ finished more than 3% lower (S&P down over 2% on the week), ending at levels not seen since mid-March.

The hardest part of this selloff is figuring out what to trade.  Virtually anything which had a bearish pattern in recent weeks has long since left the station and has felt like a chase.  By the same token, very few stocks have been able to maintain a bullish posture at all with all the market pressure, which leaves the watch lists understandably sparse.  The market is still oversold, so we should be on watch for a bounce, but we have yet to see a decent bounce kick in.

The bottom line here is that market corrections aren’t easy.  If a shift to cash (as I’ve noted here numerous times of late) was made, plenty of pain was avoided by you.  If you’ve been caught on the wrong side and stayed wrong, then the market is teaching you a lesson you won’t soon forget.  And if you’re itching to make some trades, it may be best to wait just a bit longer.  We’re going to have some excellent opportunities in front of us, but we need to let this storm blow over first.  In the meantime, shortened timeframes are still best for those interested in participating.

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: VHC, GPOR, WLK, NTES, OPEN

Swing Trading Candidates:

NONE TONIGHT

[table “63” 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 was the day the long-awaited relief bounce kicked in, allowing the bulls a day off from their recent suffering.  A relatively flat open led to some early indecision, but soon the market turned higher and trended its way higher.

The one thing that didn’t change today, however, was late-day weakness.  We’ve seen that for several straight sessions now, and it’s indicative of traders unwilling to hold overnight longs.  To see that occur again today on a relief rebound certainly doesn’t inspire much confidence though.  If that was the best the bulls have and they can’t even post a single strong finish, it’s little wonder why we didn’t see a big spurt of short-covering as anticipated.

This was an expected rebound, by both bulls and bears.  That, coupled with the poor finish, means we can’t put a lot of weight on it.  The market had become short-term extended to the downside and was due to come up for some air.  And while it’s too early to write off a more intense rally, the fact of the matter is that the buyers are going to have to bring a lot more power in light of today’s pathetic rally attempt.

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: BAS, BEXP, GDP, PDC, COST, FLR

Swing Trading Candidates:

NONE TONIGHT

[table “62” 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!

Stocks gapped slightly lower this morning, but not enough to really produce the washout-type of exhaustion move this market seems to need.  We spent the first few hours of the day range-bound but in negative territory, but right on cue we saw early afternoon weakness produce more downside follow through, and the market closed just a short distance from its lows on the day.

We’ve seen plenty of streaks before, with rallies and selloffs lasting anywhere from 5-9 straight sessions at times.  While it’s fine for the media to fixate on them when they do arrive, what we have to do as traders is stay on our toes and watch for a turnaround to begin – and it will.  That’s not to say that it will be a lasting reversal, but simply one which is likely to be worth trading.  I say that because the initial part of it at least is going to involve bulls putting cash to work as well as bears rushing to cover shorts into weakness before seeing profits evaporate.

So, the proverbial rubber band is getting rather stretched, and with each passing day the odds for a turn increase dramatically.  We’re through key levels and there’s still plenty of room to slide further – anything’s possible – but the odds for even a dead-cat bounce are getting high after this relentless pressure of the past 6 sessions.

Rather than step out in front of the slide in hopes of catching a turn, the best approach here is to wait for one of a couple things to occur.  One would be an exhaustion gap.  That would be a spooky kind of gap where it brings capitulation-type selling by the remaining holdout bulls.  They’ve endured pain, but on another wave of pressure they finally spit the bit and capitulate.  Another would be the creation of a higher low and higher high on the intraday chart.  Whether referring to the futures (ES or NQ) or SPY/QQQ, at some point we’ll see the tide start to shift with the creation of a higher relative low.  So watch for a bounce followed by a shallow pullback to indicate that.

Personally, I’m unwilling to short anything here and tomorrow will be focused on just a few names.  I’ll cover individual stocks in the video down below, but I’ll of course be involved in the major ETF’s should either of the above scenarios come into play, using a 1% stop to allow for a little wiggle room while still staying disciplined.  And we may slide further again tomorrow, that’s not out of the question, but right here I’m intent on trading the long side once conditions are suitable for a shot at buying.

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: MON, OC, MPEL, CLR

Swing Trading Candidates:

NONE TONIGHT

[table “61” 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