Archive for June, 2007
Dead Cat Bounce or Another Higher Low?
June 10, 2007 at 10:54 pm
Last week we saw bookend gains, but the downside in the middle was just too much to overcome. The indexes finally took a dip which lasted more than a couple of hours, and that’s actually a healthy thing whether you’re bullish or bearish.
This week should be an interesting one as we wait for more clues as to whether the sellers will use the relief bounce to continue unloading shares at higher prices, or if the bargain-hunters are going to resume their usual activity of buying all weakness. One thing is for sure, and that is that last week’s dip helped to shake up many individual stocks, which is a good thing for those of us who trade from the charts. No matter which way you’re leaning this week, be sure to check out this week’s Market View page over at TheStockBandit.com for a closer look at the indexes.
Trade well this week!
Jeff White
President, The Stock Bandit, Inc.
Swing Trading & Day Trading Service
www.TheStockBandit.com
[tags]Stock Market, Day Trading, Stock Trading, Investing, Swing Trading[/tags]
When Patterns Fail
June 7, 2007 at 11:08 pm
Things turned ugly this week for the first time in a while, and a lot of charts actually needed this shakeup. The CNBC headlines and dreary comments of “the worst week since March” don’t actually say much, especially since all we’ve done pretty much since then is climb higher each week. But it’s been a pretty quick correction so I can agree to that.
It’s too late to short sell on this move and a very high-risk spot to buy, so it’s the ideal time to clean out the watch lists and remove the stocks that all of a sudden are simply clutter. Lots of stocks were setting up bullish chart patterns just a few days ago, but in the last couple of sessions they’ve pulled back sharply and negated their patterns. In my book, that’s grounds for dismissal from the watch list!
One example is JRCC, which I highlighted earlier this week in my stock newsletter for members at TheStockBandit.com. The stock had been trending higher and had built a bull pennant pattern, implying more upside could come if a breakout could be produced. Instead of breaking out and triggering a buy for us, it simply sat on the watch list until today when it folded up like a cheap tent, making the pennant pattern obsolete. I’m anything but a camper, so I’ve removed this one from my watch list. Here’s a look at the failed pattern:
(Click for full-size image, courtesy of TeleChart)
The good news is that we never bought this stock because it never broke out. That’s the beauty of trading from the charts. If the expected move never comes or the stock reverses entirely, it doesn’t even matter. And that’s a far cry from trying to be overly anticipatory and buying before the chart says it’s time to.
This volatility in the market is going to keep the trading environment good for a while, and the pullback will help to produce lots of new setups for trading in the coming weeks. In the meantime, keep those watch lists streamlined with stocks that look ready to move, and get rid of everything else. It’ll help you move faster once it’s again time to buy. But not yet.
Jeff White
President, The Stock Bandit, Inc.
Swing Trading & Day Trading Service
www.TheStockBandit.com
[tags]Stock Market, Day Trading, Stock Trading, Investing, Swing Trading[/tags]
Trading Multiple Timeframes
June 4, 2007 at 10:27 pm
It’s such a strong market right now that if you’re trading the long side, there are lots of opportunities across multiple timeframes. An excellent way to diversify your trading (which I’ve discussed before) and boost your bottom line is to Trade Multiple Timeframes.
This week’s Free Newsletter over at TheStockBandit.com discusses precisely that. So, if you’re interested in learning more about putting your money to work for you across multiple timeframes, be sure to stop by and read this week’s Free Newsletter for my thoughts on the topic.
By the way, you can sign up for the free newsletter on the Free Newsletter page at TheStockBandit.com and we’ll notify you every time one is published. An opt-in form is provided at the top of the page which puts you in full control of your email subscription at all times.
Trade well this week!
Jeff White
President, The Stock Bandit, Inc.
Swing Trading & Day Trading Service
www.TheStockBandit.com
[tags]Stock Market, Day Trading, Stock Trading, Investing, Swing Trading[/tags]
