May 31st, 2012
in Gary's blogging
Opening Live Market Commentary For 05-30-2012
Markets opened flat as expected with anemic red volume as investors and traders are sitting on their hands awaiting news from Europe before making a move. The 'dippers' finally came out bargain hunting but there were but a few scraps to be found as many investors viewed this as a last ditch effort to cash in changing the volume to moderate and red. Trading is in a very narrow range as the markets move cautiously sideways looking for a augury of things to come. And come they did as the markets started to tumble in earnest under very heavy red volume.
The DOW tested its support at 12347 and the $RUT tested its 200 day MA at 755 before stopping for a breather. Other markets are a ways from their supports and need to catch up if in fact we are to see further declines. The could very well be a bear trap and caution is warranted as the DOW and $RUT seriously challenge their markers. Follow up:
Dailyfx says: “I would keep stop loss tight on short positions as the markets are a bit too oversold to react on the weaker US data.” Probably a good idea if you are afraid the markets are suddenly going to take off. Believe me that isn't going to happen to any great extent as we will see the markets test the supports and 200 day MA's very soon – maybe today.
FaceBook had settled in at 28.37 and then started to fall with the markets 15 minutes after the opening is down to 27.70 (and falling). The DOW is at 12359 down 57.74 or -0.44%, the 500 is at 1304 down 8.86 or -0.68%, the $RUT is at 755.19 down 7.03 or -0.92% and SPY is at 130.89 down 0.84 or -0.62%. The trend is down and the current bias is down.
Gold is down to 1554 with a negative bias. WTI oil is at 87.10. Brent crude is currently trading in the 102 area and falling. The USD is at 83.04 and climbing.
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Written by Gary