Put two traders in a room, and one might scream to sell while the other puts in orders to buy. So who’s right? Well, they both could be—depending on the indicators they’re looking at and the kind of trading you want to do.
We’ve rounded up our InvestorPlace advisors to give you their read of the market.
John Jagerson and Wade Hansen, Slingshot Trader
Yes, market conditions like this can be stressful and uncomfortable. However, they also present opportunities for new entries on the dips that shouldn’t be ignored. Right now, we would put the odds in favor of a shorter retracement than a larger and more disruptive change in prices. However, as usual, we will need to remain flexible in order to take advantage of a drop below support in the short term.
Jon Markman, Trader’s Advantage and CounterPoint Options
All in all, Thursday was the kind of session that we have seen repeatedly over the past year following death-defying dives to support. Very little has changed in the world except for an increase in bond volatility, and even that should straighten itself out soon. I suspect that most stocks will get back in the groove over the rest of the month. If not, I’ll be setting up some short sells and puts.
Ken Trester, Maximum Options
Our indicators are giving bullish to neutral readings, a downgrade from last week’s bullish readings. The primary reason is that many primary indexes and also sub indexes crossed below their 50-day moving averages Thursday, before rebounding late in the day. With those crosses having been or threatening to be made, the 200-day moving averages are the next, and most key, line of support. For the Dow that line is at 14,040, and it is at 1510 for the S&P 500. The Nasdaq did not cross below its 50-day average at 3370. Its 200-day moving average is at 3180.
John Lansing, Parabolic Options, Trending123 and Power Trading at the Open
During the past couple weeks, stocks from all sectors have been in a complete waterfall as many investors carried out the proverbial “sell in May and go away.” You may have seen my video in which I explain how the bullish pennant in S&P futures portends bearishness in the overall market—and that means there are some select names that we can pick up at a discount. It’s a stock-picker’s market on the long side right now.