As a follow-up to this post  from late last week, WYNN indeed found some initial support right where it needed to  at $101. As you can see on he second chart below on the updated daily timeframe, if you had followed the elements I laid out for a “going to the mattresses” setup, you would have gotten a nice long intraday flip on Friday before the stock came back down to the $101 handle. From a broader timeframe, WYNN printed a massive inverted hammer candlestick on Friday and could be putting in a more durable bottom. Once again, your well-defined stop-loss level should be no lower than $99 or so and you should have no trouble getting away from a long if you play this for a bounce. If we see strong upside confirmation in the next few days supported by good buying volume, we now have, at a minimum, a tradable range to work with on a stock like WYNN from $100 up to about $120.

As far as the other major casino stock goes, LVS presents a similar “going to the mattresses” setup, though without as well-defined a support level as WYNN. However, shorts should be looking to cover in this zone, as LVS has tons of prior price memory in this general area now. If you are nimble, these casino stocks are likely to be good short-term trading vehicles during a broad market bounce.

Of course, the overall market is still on shaky footing and bounce plays should not be viewed with any type of conviction. Playing great defense should be more important here. Be sure to see my weekly video market recap from this weekend for more in-depth analysis. I also laid out a more specific game plan for this week inside the 12631 Trading Service. Please click on the 12631 hyperlink for details about joining out service.

_______________________________

_______________________________