Good Set Up

8:30 am EST The action yesterday was very encouraging. While the early afternoon session started looking weak, there was a strong reversal into the close. Financials ended the day very strong and supported the market into the close of the day. I am encouraged by the action yesterday and the reaction to the GDP and jobless claims numbers.

It looks like we got the necessary capitulation in Newell Rubbermaid (NWL) yesterday. We had huge volume and a lower close. With this trade, I will buy the stock in stages and allow it to head lower if it wants to. As with everything else in this market, I will keep my overall position size small and I will be ready to take the loss if the stock breaks below the Mar 9 low of $4.54. There is a lot of room to the downside with this one right now. It also recently slammed up against the 50 day MA and got turned away. This trade might take a little while. That is why using options for this trade is probably not a good idea. If you can get a break above $7-$7.10 this stock will be off to the races.

Keep an eye on this. This stock can head higher. As always be careful in this market and until next time, stay low risk..