Markets Melt Up, SP500 At Highest Level

January 4th, 2013
in Gary's blogging

Closing Market Commentary For 01-04-2013

The market rise this afternoon is primarily due to the HFT algo computers. Volume has been anemic and no news to speak of which would account for the unusual melting upwards.

Aftermarket indicated a sharp profit taking stint. SP500 moved up to highest level since 2007.

Not much to add except to add that Monday may be a selloff of some sort as the small caps didn't follow through.

Follow up:

The RRR** has been narrow at the opening bell for the past several months and continued the trend into the closing 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 2012 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 the past year.

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.

The DOW at 4 pm is at 13435 up 43 or 0.33%.

The SP500 is at 1466 up 7 or 0.49%.

SPY is at 146.28 up 0.55 or 0.38%.

The $RUT is at 879.15 up 6.55 or 0.75%.

NASDAQ is at 3101 up 1 or 0.04%.

The longer trend is up, the past months trend is bullish and the current bias is up.

How Oil Really Gets Priced

WTI oil was down this morning and the reversed itself and is currently trading up at 93.10 trading between 93.16 and 91.55 and the bias is positive.

Brent crude was also down earlier and is currently trading up at 111.14 trading between 112.10 and 110.39 and the bias is positive.

Gold was down this morning and has since reversed its course. Currently trading down at 1656.75, trading range is between 1689.70 and 1626.00 with a positive bias.

Dr. Copper is at 3.70 up from 3.67 earlier.

The US dollar fell from 80.99 earlier to 80.52 and is currently trading down at 80.59.

The 500 at the close.

The DOW at the close.

** 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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