Avoid Self-Inflicted Traps

The market is challenging enough, as is, without us being our own worst enemies and leading ourselves into traps like the brutal one shown above. 

Thus, we want to avoid overthinking and extrapolating too much when it comes to growth stocks which have held up very well this summer. 

Case in point: COUP GH TTD, a software, healthcare, and software growth monster, respectively, were red yesterday and notably lagging the market's rally. If we had extrapolated that underperformance by cherry-picking yesterday in a vacuum it likely would have been a mistake, since anything given thing can happen in the market on any given day. 

But the integrity of their charts had not be disturbed.

And, in fact, as I write this we have COUP GH TTD all flashing green even as the indices struggle to bounce off session lows but remain red. 

While it likely true that COUP GH TTD, among others, will need the broad market to either remain rangebound or improve into the autumn months in order for them to successfully sustain fresh uptrends, their general outperformance this summer reflects the impressive growth those firms have. So long as we do not suffer a deep correction this autumn, all three should remain on the long radar for viable swing trades, yesterday's isolated red be darned.