Good day! It's pretty interesting that so many people have apparently given up on trying to decide what to do with the market right now. We've been in one of the narrowest and most choppy ranges the market has seen in quite a long time and it's taking out a lot of traders. While difficult, I don't think the current market is impossible. It certainly takes a great deal of patience, but to be around for the long haul, you have to have a plan for times like this.

Up until this week, the majority of my own trades have been swingtrades over the past month or so. This is a pretty big difference since, before May, I had a lot higher focus on daytrading the EMinis. As those began to jump around a lot more, however, many stocks on the daily charts were shaping up and we saw some very nice one to three week holds on daily breakouts. In the past week I've come across fewer such setups and have had to switch modes once more.

I have found that for equities, the best setups lately have been in the morning. Interest just seems to dry up past that point, although there have been some exceptions. Nevertheless, I have still found significantly fewer low risk patterns as compared to previous months. While opportunities are there for breakouts and flags and the like, there are more cons on the average trade than is ideal.

It's very important to recognize this type of a market and to guard against the common mistake of overtrading out of boredom or just the itch to be in something. Sitting and waiting for opportunities to materialize is just part of being a trader. The best trades are often those that seem obvious and don't require a great deal of analysis. If you feel like you are working extra hard just to find something to trade and your fingers are starting to cramp up from hitting the down arrow as you flip through charts, then you are probably trying too hard. There are only so many stocks you can scan in a day before you are looking at things that only trade a few thousand shares a day.

I try to stick to stocks over 750k average daily volume for daytrades because it's easier to not get flushed out of those stocks. The stocks on the gainers and losers lists for the day also tend to be some of the best ones for daytrading. Lately those have had a lot more thin stocks listed and hence higher risk stocks. While patterns on these still work overall, the amount you loose in slippage and the higher degree of execution skill needed makes them difficult for a lot of traders. When you determine your share size based upon risk amount if you do trade these, you should be sure to figure in that slippage so that you don't end up losing more on the thinner stocks than you would on a trade in something more liquid.

I still have a more bullish bias on the daily charts at this time. I'm not overly tied to that bias, however, and am willing to go either way. In individual stocks for daytrading though, I have not found a great deal for shorts so far this week, despite the Dow technically closing lower for three days in a row. I will continue to hold off from trading aggressively for the rest of the week and look primarily intraday for setups at this point. I did spend a good deal of time looking for new swingtrades Wednesday evening, but nothing really jumped out at me to catch my attention.

Updates: AAP from the $51.88 zone on the 4/25 hit new highs of $65.37. Trailing stop initiated for position trades. Some hit. CI triggered on 5/26 with the break of $97.55 and has highs of $107.79. Targets hit and trailing stops now initiated. SLXP broke out on 6/15 over $18.13. It has highs of $18.91.

Economic Reports and Events
June 23: Initial Claims 06/18 (8:30 am), Existing Home Sales for May (10:00 am)
June 24: Durable Orders for May (8:30 am), New Home Sales for May (10:00 am)
June 27: -
June 28: Consumer Confidence for Jun (10:00 am)

Earnings Announcements of Interest
Only stocks with an average daily volume of 500K+ are listed. List may not be complete so be sure to always check your stocks' earnings dates before holding a position overnight. (A) = Earnings after the close, (B) = Earnings before the open, (?) = Earnings time not specified at the time of this writing
June 23: ATYT (?), COGN (A), DLM (?), FDO (B), FDX (?), OVTI (A), RAD (?), SLR (?), TEK (A), TIBX (?)
June 24: -
June 27: NKE (B), PAYX (A), WAG (?)
June 28: APOL (B), EMMS (B)

Toni Hansen is President and Co-founder of the Bastiat Group, Inc., and runs the popular Trading From Main Street. She can be reached at Toni@tradingfrommainstreet.com.