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Sunday, June 22, 2003 9:56:11 PM
Trading Ideas
by Dave Landry, Director of Research
TradingMarkets.Com
June 23, 2003
Looking to the indices, on Friday, the Nasdaq opened stronger but quickly found its high and sold off hard. It bounced back early in the morning to recover about half its gains but traded back down to new intra-day lows early in the afternoon. It then traded mostly sideways for the remainder of the day. This action has it closing poorly. So far though, it only appears to be pulling back in its uptrend (i.e. Double Top Knockout-looking).
The S&P was a bit choppier. It too sold off hard late in the day but did manage (albeit just barely) to close in the plus column.
Looking to the sectors, on the downside, the homebuilders were hit especially hard. It's too early to tell whether this is just the rolling corrective action that I spoke of recently or the start of something bigger. The semis continue to lose steam. Biotech was able to stabilize in its freefall but remains questionable. On the flat side, groups such as retail and software remain in longer-term trends but continue to trade mostly sideways as of late. On the bright side, the HMOs which have been hit hard recently, appear to have stabilized and might have the potential to resume their uptrend out of a pullback. Ditto for major drugs. Telcom remains in strong uptrend.
So what do we do? The indices remain below their old highs, but so far, only appear to be pulling back. I am somewhat concerned that the VIX is hovering near its lowest levels in nearly a year. However, so far, it's not stretched away from its moving average (i.e. not a sell signal). Most sectors, with the exception of the "debacle de jour", still remain constructive longer-term. Therefore, all things considered, I think you can still continue to focus on the long side. However, continue to honor your stops just in case your sector (and stock) is next on the chopping block.
Looking to potential setups, Healthnet (HNT), in the aforementioned HMOs, looks poised to resume its strong uptrend out of a pullback.
Best of luck with your trading on Monday!
by Dave Landry, Director of Research
TradingMarkets.Com
June 23, 2003
Looking to the indices, on Friday, the Nasdaq opened stronger but quickly found its high and sold off hard. It bounced back early in the morning to recover about half its gains but traded back down to new intra-day lows early in the afternoon. It then traded mostly sideways for the remainder of the day. This action has it closing poorly. So far though, it only appears to be pulling back in its uptrend (i.e. Double Top Knockout-looking).
The S&P was a bit choppier. It too sold off hard late in the day but did manage (albeit just barely) to close in the plus column.
Looking to the sectors, on the downside, the homebuilders were hit especially hard. It's too early to tell whether this is just the rolling corrective action that I spoke of recently or the start of something bigger. The semis continue to lose steam. Biotech was able to stabilize in its freefall but remains questionable. On the flat side, groups such as retail and software remain in longer-term trends but continue to trade mostly sideways as of late. On the bright side, the HMOs which have been hit hard recently, appear to have stabilized and might have the potential to resume their uptrend out of a pullback. Ditto for major drugs. Telcom remains in strong uptrend.
So what do we do? The indices remain below their old highs, but so far, only appear to be pulling back. I am somewhat concerned that the VIX is hovering near its lowest levels in nearly a year. However, so far, it's not stretched away from its moving average (i.e. not a sell signal). Most sectors, with the exception of the "debacle de jour", still remain constructive longer-term. Therefore, all things considered, I think you can still continue to focus on the long side. However, continue to honor your stops just in case your sector (and stock) is next on the chopping block.
Looking to potential setups, Healthnet (HNT), in the aforementioned HMOs, looks poised to resume its strong uptrend out of a pullback.
Best of luck with your trading on Monday!
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