December 10th, 2012
in Gary's blogging
Opening Market Commentary For 12-10-2012
Premarket was flat and opened the same but on really anemic green volume as investors seem to waiting for the Santa Claus Rally which may or may not happen this year. About 10 minutes into the opening the HFT algo computer melted the averages up a tad to near Friday's closing numbers.
By 10 am the green volume pick up, but still low as it has been for the year. $VIX is dropping as the markets are generally melting up. I can not see today as being a day for the bulls as there is way too much negative news floating around. Plus there are no US financial reports today to either float or sink the market. Most likely we will see another lackluster session with the averages remaining mostly in the red.
The RRR** has been narrow at the opening bell for the past several months and continued the trend again this morning. This trend makes predictions of movements during the session nearly impossible and trading becomes futile and unprofitable.
As long as market volume remains light or the trading range is narrow, one can expect successful trading to remain elusive. The RRR** has been wider on volatile sessions lately and is expected to become more so as the year ends, but a lot of guessing still remains. Correctly 'guessing', of course, is the tricky part of the successful trading equation. Any trades today will probably end up on the meager side of profitability if you are lucky as most trades have been less than optimal during this past year.
I also have issues with some pundits writing almost every day that there are setups for day trading. This may be 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. Do not fall into the trap of money burning a hole in your pocket, sit tight better days are coming. Watch for increasing volume to signal improved trading.
Swing trading is also at your own risk for all the reasons mentioned above. Because the market is at a crossroads of sorts, I would prefer to sit on my hands as the markets are currently untradable. Guessing where the market is going to be tomorrow or next week, at this time anyway, can be a foolish and costly endeavor.
The DOW at 10:00 is at 13179 up 22 or 0.17%.
The SP500 is at 1418 up 0.40 or 0.03%.
SPY is at 142.47 up 0.10 or 0.07%.
The $RUT is at 824.49 up 2.28 or 0.28%.
NASDAQ is at 2989 up 10.77 or 0.36%.
The longer trend is up, the past months trend is bearish and the current bias is up.
WTI oil was up today and is currently trading down at 86.11 trading between 85.90 and 86.77 and the bias is negative.
Brent crude was up today and is currently trading down at 107.59 trading between 107.00 and 108.52 and the bias is negative.
Gold was up this morning. Currently trading down at 1712.50, trading range is between 102.50 and 1716.70 with a positive bias.
Dr. Copper is at 3.71 up from 3.66 earlier.
The US dollar was up from 80.29 earlier to 80.77 and is currently trading down at 80.49.
** RRR = Risk Reward Ratio
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Written by Gary