After a massive run-up going into this morning’s job number, the market was certainly set up for a selloff, and when the number came out (which was AWFUL), we certainly got a selloff…sort of. The market started the day with a gap, tried to bounce a bit, but then quickly sold off further. That was about it, however, and around 11:15, a bottom was put in for the day and the market rallied strongly from there, finishing well off of its lows. Although the final numbers will show decent sized losses, in my opinion today was a very impressive showing by the bulls. Remember as well that this was in the face of an AWFUL jobs number…

I went into the day short two stocks (SOHU and BEXP) and long only one stock. I was stopped out of both shorts by lunchtime and began to go long again in force as I saw setups I liked all over the place. This may be the wrong play as perhaps the market needs to pullback further from here, but given the action intraday, I think it was the right move.

Even in the morning selloff, there was no damage seen on any of the charts I went through. If you went solely by the charts of individual stocks, you would have been shocked that the market was down over a percent. A slower pullback with more consolidation would have been better, but based on what we saw today, this might be it. It looks like dip buyers are back in the game and those underinvested during the recent run-up are looking to get invested quickly.

My family and I are lake-bound for our week-long summer vacation, so I am putting a video out now with the stocks that I am watching closely next week. I skipped the overall market commentary as I think today proved for now that this market is one to buy, but as always, make sure you use stops and don’t hold losses in case this market turns. I will have my laptop during the vacation and although I probably won’t be posting much, I will be tweeting occasionally and maybe sharing some thoughts as I get them. Best of luck in the week ahead – it will be quite hard to top this past week. So far, I am liking the month of July much, much better than June.

Recommended Posts

moving-average
Charts

Moving Averages for Trading The Swings

Choosing a moving average for swing trading can be tricky. Many swing traders prefer using a higher period setting because the higher it is, the later it will be – so the lower it is, the earlier it will be, and vice versa. You can also use a lower period setting to confirm trend changes – but remember, the higher the period, the later it will be. So, you can’t depend solely on a moving average to be successful at swing trading. The best way to use a moving average for swing trading is to follow a trend. Traders can use this indicator to confirm their trades, as it smooths out price fluctuations and incorporates older data. However, the first and most important thing to remember is that past performance is no guarantee of future performance. A better way to determine a trend is to use the longer-term chart. However, if you’re a new trader, you can also use the short-term chart as a guide. In swing trading, a moving average can be a powerful tool, but it must be […]

SwingTrader
indicator
Charts

Indicators for Swing Trading – What’s Best?

There are several indicators that you can use to make money swing trading. A moving average is a popular indicator, and is used to validate the direction of an asset’s price behavior over a specified period of time. The moving average can be created in two basic styles, simple and exponential. Simple moving averages are the easiest to use and provide the most recent statistics. The exponential version gives you more recent data and is best suited for shorter-term investment stocks. The Donchian Channel is probably the most common and straightforward indicator. It helps you identify buy lows and sell highs. Another tool that can help you find a profitable trade is the OHLC indicator. The Zig Zag indicator will help you find swing highs and lows, but it’s best used in conjunction with price action. While all three indicators are helpful, they won’t make your life easy. You must know how to interpret them properly. Another indicator for swing trading is the Relative Strength Index. This indicator is a trend indicator that shows when an asset is overbought or […]

SwingTrader