Wednesday Feb. 3 Premarket Analysis
Today in the Stock Market
Dear Fellow Traders,
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February appears to have a good start for the bulls. In the last two days the Dow Jones Industrial average has rallied over 200 points. The market still has a hill to climb as it continues to reclaim lost territory. On Tuesday the DJIA managed to close well above the 10,200. The market started the day at 10,186 and finished the session at 10,296. According to some of the comments that I heard yesterday investors and traders are feeling optimistic over positive housing data. Technically it looks like we will have a reliable pivot point established with the low of last friday.
We saw a similar rally in the tech sector. QQQQ, the ETF of the NASDAQ Composite stared the day in the red but managed to finish in positive territory. At the start of the trading day the ETF hit a low of $43.01, which must have triggered a strong buy signal because the market never looked back. The ETF finished the day just 13 cents from its high, closing at $43.65. The $43 area is once again proving to be a strong support level for QQQQ.
The story of the day was gold prices and the U.S. dollar. The U.S. dollar has been considered a safe-haven investment since the start of the financial crisis. In period of fear and concern people jump out of riskier investment and into greenback. Gold is also considered a safe-haven investment but not to the same degree as the U.S. dollar. However that now optimism is growing again people are jumping back into the gold market as a hedge against inflation and weaker currencies. GLD, the biggest gold ETF, gapped higher for the second straight session and opened at $109.60. The precious metal hit a high of $109.60. Although it finished the day in negative territory, the ETF managed to hold on to most of its gains closing at $109.13. Gold could consolidate in a fairly wide range bouncing between support at $108 and resistance at $110.
It was an exciting day for our latest pick BGOI. The stock was in pullback mode for most of the day but managed to rally back to close flat. The stock dipped to a low of $0.041 before investors jumped in and pushed the stock back up to it’s close at $0.05. I want to highlight Tuesday’s move because it is a good example of practicing proper position management. Some traders were able to take advantage of the dip in price to lower their average cost of the trade. Averaging down can be risky and traders should be very selective when they use it but a strong momentum buy like BGOI can create a very good opportunity to maximize their profits.
BPAC is showing signs of consolidation but there are also signs of strength. The stock gapped higher in the morning opening at $0.57 and finished the day at yesterday’s closing price of $0.55. This stock was also under pressure for most of the day but there were buyers sitting on the sidelines waiting for the right price to jump it. In intra-day trading BPAC was close to touching its 20-day moving average around $0.53, which probably triggered a good buy signal.
AGCZ had a volatile day. Low volatility in the stock is causing some big swings in the price. The stock opened up at $0.28 and hit a low of $0.20 and then finished the day at $0.236. Now that gold is off its lows we should start to see this stock push higher in the near term.
Finally, we continue to monitor RVBF. The stock appears to have found a new support at $0.10.
Have a Great Trading Day.
One Response to “Wednesday Feb. 3 Premarket Analysis”
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Dear Francis, again I did not receive your new pick. I bet it’s too late by now. I would appreciate it if you could let me know how to get the picks on time. Thank you, Mike.