Stimulus Plan Fails to Pass Buy Stocks Today? 3.23.20
Stock futures traded limit down, again, after the Senate failed to pass a stimulus bill.
But is that a bad thing for stocks? Does that mean stock traders wake up and sell the bad news?
No. Not so fast.
Price action. Always pay attention to price action. Profitable active traders only care IF a stock moves, not why.
Sure we will read WHY after the fact but we aren't analysts. Do you really think your $49 per month subscription to a news service is going to give you actionable insights before the smart money?
So be a trader, Build a game plan from your strategy and ignore the news. Much of which is written or said from people who have never bought or sold a stock in their life.
Video: Stocks for Breakfast
TODAY'S TRADING GAME PLAN
Since this mornings gap lower and halt, stock futures are in a range. No further selling has occurred.
So it's smart to look both ways this morning. Could we trade lower when the stock market opens? Sure. Is it a lock BECAUSE of the bad news.
No. No way.
Today I'm monitoring two key stages of price action. If we break Friday's lows, and if we break the opening range.
If we break both to the downside. I'm ready to short sell, as long as we are well-offered on my main charts.
However, if we break down and reverse, many poorly planned traders will be stuck in bad trades, and that means opportunity to the long side.
Because we are in a pre-market consolidation, the key stocks in my watch list are inside days that I'm looking for a trend day.
This means I'm looking to buy stocks or sell short (depending on price action) and then hold to the close. I'm looking for a large green or red candlestick and a big pay day in those stocks.
Stocks mentioned that meet the criteria: DIS, FB, LOW, TJX, GOOGL, MS, AND SQ. One stock in particular has set up an inside, inside day. A potential powerful day.
The theme for today could be called "Look both ways." Bad news for sure. But good traders let price tip its hand.
I don't believe we've seen a long-term bottom.
If you have questions or feedback, please leave a comment below this episode of Stocks for Breakfast.
Have a great day.
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