December 31st, 2012
in Gary's blogging
Midday Market Commentary For 12-31-2012
At noon the markets are 'muddling' along at or near Friday’s closing. FX markets are closed and Bonds will be at 1 pm.
I am cautiously optimistic that the markets will close somewhere in the vicinity they are now. HOWEVER, if you are trading today I would be ready for a sudden market movement, either up or down. Otherwise and regardless of what happens today, the first trading day of 2013 is going to be the same 'ol, same 'ol.
Happy New Year – yeah, right!
If you haven't read my thoughts on this 'Fiscal Cliff' drama please do at: Icecream and Fiscal Bypass Surgery
The RRR** has been narrow at the opening bell for the past several months and continued the trend again into the midday session. This continuing trend makes predictions of session movements nearly impossible making trading 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 today ends and 2013 begins, but a lot of guessing 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 2012.
I also have continuing 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. Until the 'fiscal cliff' issue is resolved, we will not have much direction indicators showing us the way.
The DOW at 12:30 is at 12935 up 2 or 0.02%.
The SP500 is at 1406 up 4 or 0.27%.
SPY is at 140.41 up 0.37 or 0.26%.
The $RUT is at 839.96 up 8 or 0.95%.
NASDAQ is at 2981 up 21 or 0.71%.
The longer trend is up, the past months trend is bullish to neutral and the current bias is up.
WTI oil was down this morning and is currently trading up at 91.25 trading between 90.00 and 91.40 and the bias is neutral.
Brent crude was down earlier and is currently trading up at 110.59 trading between 109.30 and 110.75 and the bias is positive.
Gold was up this morning then turned down radically and now is trending up again. Currently trading up at 1665.36, trading range is between 1659.49 and 1669.00 with a positive bias.
Dr. Copper is at 3.62 up from 3.59 earlier.
The US dollar fell from 79.94 earlier to 79.71 and is currently trading down at 79.87.
** RRR = Risk Reward Ratio
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Written by Gary