Range Bound Averages Showing Little Activity

October 22nd, 2012
in Gary's blogging

Midday Market Commentary For 10-22-2012

Not a whole lot of action today as the volume tappers off. Averages are in the red and remaining flat. I suspect the markets will remain range bound for the remainder of the session, once again putting traders on the sidelines. The question now of course will the majors remain below the 50 day MA during this coming week.

Follow up:


Markets are weighed down by disappointing earnings

Stocks are mostly lower in midday trading as investors digest some weak earnings reports.

The Dow Jones industrial average was off nine points at 13,334 shortly before noon Monday. It was moving between small gains and losses all morning. The Standard & Poor's 500 was off less than two points at 1,431 and the Nasdaq composite inched up six points to 3,011.

Hasbro, the toymaker behind brands like My Little Pony and Transformers, said its sales for boys and preschool were less than the company had hoped. The results still beat analysts' expectations.

Clothing maker VF Corp., whose brands include The North Face and Wrangler, slipped after its revenue fell short of analysts' estimates.

The RRR** was very narrow at the opening bell, just as it has been for the past month. Any trades today will probably end up on the unprofitable side as long as this market remains flat or continues to have low volume.

I have issues with some traders in that they are saying there are setups for day trading. This is true enough, but the trading range is so narrow that way too money has to be put on the table just to get back meager gains.

Swing trading is also at your own risk and being the market is at a crossroads of sorts, I would prefer to sit on my hands rather than risk guessing incorrectly. Eric Parnell said it correctly “all of the prevailing economic forces today point to a stock market that should be in decline” and “unstable economic and market conditions are becoming increasingly tumultuous”. He goes on to say in his article, 50 Shades Of Stock Market Grey, “How can you best participate in any further upside while keeping things as clean and risk controlled as possible?”.

Guessing where the market is going to be tomorrow or next week, at this time anyway, is a foolish endeavor.

The DOW at 12:00 is at 13325 down 18.50 or -0.14%.

The 500 is at 1431 down 2.18 or -0.15%.

The $RUT is at 820.44 down 0.56 or -0.07%.

SPY is at 143.20 down 0.18 or -0.13%.

The longer trend is up, the past week's trend is bearish and the current bias is down.

Range Bound Trade Continues In WTI Crude

WTI oil was up today and has descended to 89.48 trading between 89.25 and 90.80 and the bias is negative.

Brent crude was up today then crashed to its earlier numbers, rose again to its previous morning highs and then started to melt downwards once more. Currently it is at 110.06 trading between 109.48 and 110.90 and the bias is negative.

Gold is up this morning but has consolidated moving mostly sideways. Currently trading down at 1727.86, trading range is between 1713.90 and 1727.20 with a neutral bias.

Dr. Copper is at 3.62 down from 3.65 earlier.

The US dollar fell from 79.74 earlier to 79.54 and is currently trading at 79.62.


** RRR = Risk Reward Ratio

To contact me with questions, comments or constructive criticism is always encouraged and appreciated:


Written by Gary

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