December 10th, 2012
in Gary's blogging
Closing Market Commentary For 12-10-2012
Markets traded sideways for the most part on low volume except for a short burst off selling towards the closing bell. No news today and the $VIX has melted down all day stopping around 16 – if that really means anything.
The averages closed in the green but flat and trading once again in a very tight zone.
If the charts can be trusted much less believed, a break out should be in the cards any day. Be very much on the alert for a bear trap as it appears investors seem to buy first and then consider the ramifications of the 'great' news that just heard. (How many ways can one write another boring day?)
The RRR** has been narrow at the opening bell for the past several months and continued the trend throughout the afternoon session. 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 4:00 is at 13169 up 14.75 or 0.11%.
The SP500 is at 1418 up 0.48 or 0.03%.
SPY is at 142.56 up 0.15 or 0.11%.
The $RUT is at 826.26 up 3.99 or 0.49%.
NASDAQ is at 2986 up 8.92 or 0.30%.
The longer trend is up, the past months trend is bearish and the current bias is neutral.
WTI oil was up today and is currently trading up at 85.68 trading between 85.90 and 85.30 and the bias is negative.
Brent crude was up today and is currently trading down at 107.40 trading between 107.00 and 108.52 and the bias is negative.
Gold was up this morning. Currently trading up at 1711.77, trading range is between 1717.38 and 1716.70 with a negative bias.
Dr. Copper is at 3.70 up from 3.66 earlier.
The US dollar was up from 80.29 earlier to 80.77 and is currently trading down at 80.44.
** RRR = Risk Reward Ratio
To contact me with questions, comments or constructive criticism is always encouraged and appreciated:
Written by Gary