If we have a down gap on Monday, I would have greatly regretted not having acted on a negative signal. In this type of market, better be safe than sorry.
Later in the day, BWA (Regional bank) broke down on volume, but it was already too far down when I noticed it. I therefore decided to enter a buy limit on a bounce to the intraday resistance and basically breakdown point. This worked well, but I only took 1/2 position as the oversold bounce might still have some legs.
This is also the reason why I opened a long IBB position later in the day. We could indeed notice that the IBB MF looked positive in the afternoon small pullback.
If we have a continuation of the bounce on Monday, IBB should do well. If we break on Monday, BWA should do OK.
The list of trade ideas for Monday is below. Most of the ideas are still on the short side. This indicates that the oversold conditions of the market has been resolved and since the trend is still down, more short ideas will be produced by the system.
The four ideas colored in Blue are weak stocks that will issue earnings this week. Hence, it is not advised to trade them. I however include them here for monitoring purpose only to see if the system is correctly predicting the next move for these stocks.
TXN, INTU and CTXS have earnings on Wednesday
PCAR on Friday.
On a side note, this week is heavy on earnings. CVX has earnings on Friday and XOM on Feb 2.
I would be cautious into trading XLE ahead of these two announcements.