September 22, 2021

Fed Chair Powell was the center of attention today, saying that the taper of the central bank's bond buying program would begin "soon" and might end in mid-'22. The futures market is now discounting the first actual hike of the overnight federal funds rate in late-'22.

For the second-straight day, advance-decline data were better than the showing of the Nasdaq and S&P, a moderate plus.

The charts above indicate relative strength shown in the Nasdaq vs. the S&P. In fact, the Naz has performed in line with the S&P for the past three weeks.

Some participants may be looking for an O'Neil follow-through day. An FTD loses its importance when it is used on anything less than an 8%-12% correction. The Nasdaq's 5.7% loss over nine sessions, then, renders the FTD concept to be moot in this particular pullback.

With that said, it was a distinct positive to see both averages put in major accumulation days today.

While the jury is still out on whether Monday's low was in fact the low, there is enough stand-up action on the part of the growth-stock glamours to warrant some exposure. Unfortunately, there was not enough of a pullback in the averages to reset chart patterns such that a good number of attractive pattern setups are available.

To wit, the best names came out of one- or two-week ledges to new highs. I am not concerned about our being able to enter some of these extended actors. They will require pullback entries which should appear before long.

The following names are believed to be the most attractive for our strategy of speculation in the $13+ market.

Autonation (AN)

Moderna (MRNA)

Semtech (SMTC)

Snap (SNAP

In summation, the better action in a number of growth issues Tuesday and today provides us with a positive bias. There are few pattern setups for the speculator who seeks entry on five-week-plus base breakouts. We expect to see some pullback opps in some of the leaders before long.

Kevin Marder

Trading Lessons
Introduction to the service video (38:00)
Money management and risk management video (20:27)
Bread and butter pullback video (11:10)
Bread and butter pullback: Pt II video (15:09)
Bread and butter pullback: Pt III video (31:48)
Bread and butter pullback: Pt IV video (30:16)
System R