1. Expaning red volume
2. Outside day
3. $IWN sold off very swiftly today
4. QQQ's had an outside day
5. We are extended on the daily chart from last Friday and could chop around a little bit before going
I say all this not to convince you to short the market too, I am may very well be wrong. I am more over doing this to show and tell you my reasoning and what I see, this helps me and you. Go forward, I think we can see a little downward pullback action, and if all go according to plan, this pullback could be a buyable one. We need to form a higher low to confirm this though. I drew some key levels on the chart that includes my target (right now) for this short.
Apple had a nice day today despite the market selling off, it didn't have an outside day so that is a plus. Apple also traded on lower volume today, which seems good. Going forward, I would keep an eye on Apple and see if falls below today's lows. Apple is also a little extended on the daily chart after having such a strong week last week.
Google had a nice bullish engulfing day on decent volume. I would like to see Google to break the 8 EMA to have any continued momentum. I would not enter long now, it is at resistance and the volume today wasn't overall impressive.
Amazon formed a doji and slight outside day on lighter volume. Amazon is extremely extended on the daily chart and could pullback a little to get some more buyer interest. The doji represents some indecision on the market going forward. The volume is better sign though, the thing we like about that is that the major reversal usually come on high volume, this is not on high volume.
Going forward, I would still be careful and play only the strongest stocks but we have moved alot and could be due for a little bit of a pullback, which is a healthy action for the bulls. I am short and could be long in a couple days depending on the action. Overall the signs call for a pullback, not a downtrend bear market.
And as always, look on my StockTwits/Twitter (@BenCBanks) for some charts of some of these stocks I mentioned plus more.
StockTwits - http://stocktwits.com/BenCBanks
Twitter - https://twitter.com/BenCBanks