Why The Indices May Have Dodged A Bullet
Enviado: 5/8/2003 10:44TradingMarkets.com
Why The Indices May Have Dodged A Bullet
Monday August 4, 6:27 pm ET
By Dave Landry
Looking to the indices, on Monday, the Nasdaq (NasdaqSC^IXICNews) sold off hard in early trading. However, it found its low by mid-morning and began to rally. The rally accelerated late in the day. It did give back some of its (earlier) gains going into the close but still managed to close well.
This action has it testing the bottom of its recent trading range
The S&P put in a similar performance.
This action has it tailing down and testing its recent trading range and keeps it right at its 50-day moving average
So what do we do? Monday was a tail (pun intended) of two markets. In the morning, the indices were breaking down out of their trading ranges and it was 'obvious' that they were rolling over. However, by the afternoon, they had recovered and it then appeared that they have completed a successful 'test'. Further, the VIX reversed after hitting multi-month highs. This action triggers several CVR buy signals. Therefore, based on this (both price and VIX action), it appears that the indices could bounce. However, there's no reason to bet the farm just yet since we still remain in a trading range.
No setups again today tonight (Monday). Aggressive traders may look for a bounce trade in the index shares.
Other
In case you were wondering, I'll do an update on the recent money/position management example using Healthnet (NYSEHNTNews) on Tuesday.
Best of luck with your trading on Tuesday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
Why The Indices May Have Dodged A Bullet
Monday August 4, 6:27 pm ET
By Dave Landry
Looking to the indices, on Monday, the Nasdaq (NasdaqSC^IXICNews) sold off hard in early trading. However, it found its low by mid-morning and began to rally. The rally accelerated late in the day. It did give back some of its (earlier) gains going into the close but still managed to close well.
This action has it testing the bottom of its recent trading range
The S&P put in a similar performance.
This action has it tailing down and testing its recent trading range and keeps it right at its 50-day moving average
So what do we do? Monday was a tail (pun intended) of two markets. In the morning, the indices were breaking down out of their trading ranges and it was 'obvious' that they were rolling over. However, by the afternoon, they had recovered and it then appeared that they have completed a successful 'test'. Further, the VIX reversed after hitting multi-month highs. This action triggers several CVR buy signals. Therefore, based on this (both price and VIX action), it appears that the indices could bounce. However, there's no reason to bet the farm just yet since we still remain in a trading range.
No setups again today tonight (Monday). Aggressive traders may look for a bounce trade in the index shares.
Other
In case you were wondering, I'll do an update on the recent money/position management example using Healthnet (NYSEHNTNews) on Tuesday.
Best of luck with your trading on Tuesday!
Dave Landry
P.S. Reminder: Protective stops on every trade!