Markets Close Down, $RUT Leading the Fall

November 15th, 2012
in Gary's blogging

Closing Market Commentary For 11-15-2012

I said earlier that we were sitting on a minor support. That is not quiet correct as it is the ending of a major support zone that extends from ~1356 to a high of 1415. It appears we are near breaking through and the next step is ~1320 with several support bumps along the way. Tomorrow may tell the story and I would not be surprised to see the markets jump on any kind of halfway good news.

The markets closed down but a minor and weak rally off the 1350 area saved the day from being a complete waste. Worth noting is that the Russell 2000 led the declines once again and bringing forth more bearishness to the mix.

Follow up:

The RRR** was inviting at the opening bell, but not wide enough, even at the closing bell, to want to take a chance of being on the wrong side of a trade. Yesterday for example, the premarket was up and with higher than usual volume indicating a possible gap up. As we all know now that would have been a very unprofitable move had anyone acted on that and gone long.

Way too much guessing is required and any trades today could end up on the unprofitable side as long as this market continues to have low volume. Low volume is the key here as the averages CAN be manipulated by the HFT computers. Large blocks may also have difficulty in completing the desired numbers with low volume.

I also 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 sometime 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 as the markets are currently untradable. Guessing where the market is going to be tomorrow or next week, at this time anyway, is a foolish endeavor. Yesterday I 'guessed' that the markets could be up after 2 days of below normal numbers.

The DOW at 4:00 is at 12542 down 28.57 or -0.23%.

The 500 is at 1353 down 2.17 or -0.16%.

The $RUT is at 769.48 down 3.72 or -0.48%.

SPY is at 135.78 down 0.13 or -0.10%.

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

How Oil Really Gets Priced

WTI oil was up today and is currently trading up at 85.56 trading between 86.09 and 84.70 and the bias is negative.

Oil Inches Higher Amid Gaza Strike, Investors Downplay Risk

Brent crude was up today and is currently trading up at 110.98 trading between 109.60 and 111.12 and the bias is positive. Only Brent is rising because of the unrest in the middle east.

Gold Tumbles As Same Dedicated Seller Reemerges

Gold was down this morning with a brief stint to the upside and then turned back down - significantly. Currently trading up at 1714.81, trading range is between 1727.51 and 1706.00 with a neutral bias.

Dr. Copper is at 3.47 up from 3.45 earlier.

The US dollar rose from 80.96 earlier to 81.24, then back down to 80.99 and is currently trading down at 81.11.

The 500 at the close.

The DOW at the close.

Read at Zerohedge this morning.

Listening to Rehn, Van Rompuy, Juncker and their cohorts is rather like listening to the cheerleaders at the football game and their advice on financial matters is probably right in-line with the knowledge of the cheerleaders; but then I don’t want to insult the cheerleaders.

The economy in Europe is so bad now that a picture is only worth two hundred words. The Europeans blame everything on the ratings agencies lately. There is some wisdom to this. “Moody” is how they are feeling and “Standard & Poor” is what they will be feeling soon.”

** 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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