Interpreting stock vs. market weakness

T

TraderGreg

I bought a call on DELL in the last five minutes of the market Monday with a very bullish breakout close above crucial 8 month levels, as well as a good RSI trend and other indicators, etc. However, saying that DELL looked weak vs. the rocketship market today would be a huge understatement. How should I interpret DELL's movements, even though it is still in breakout territory?

I am a relatively new trader, although I have been learning the markets for a long time. I haven't been able to interpret these situations correctly, and is something I run into here and there.

My instincts tell me to watch it very closely and keep a stop right below the resistance, in the event that it is simply a breakout consolidation.

How do you interpret these situations, and what would you do?

Thanks for your help.
 
DELL rarely travels up 4 to 5 days without resting.. In the current market a 4 day move is as much as you will get in a stock. You need to buy as soon as it breaks out of a congestion area,,, Also use weeklies more and you'll see 26 is a problem area for DELL.. Finally, Sectors... The Financials (ETFs UYG or SKF) are the market movers lately as they got us where we are, hence they move the most, along with Commodities.. up AND down.

No a bad pattern in DELL overall though..

Hope this helps..
 
I will definitely add a week chart to my collection. I was looking at the levels back to the gap 9 months ago, but interpreted breakout from the double top gap resistance as the breakout, and missed the other falters around 26 (which I would have seen on a weekly). I like your trading style. Thank you.
 
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