January 22nd, 2013
in Gary's blogging
Opening Market Commentary For 01-22-2013
Premarket numbers were flat and non-committal as to any direction early this morning. Oil, copper, gold and the USD were all more or less flat indicating we may have another golfing day in the works. The medium rated Chicago Fed National Activity Index come in at 0.02 down from the last report of 0.27. Evidently, the markets didn't care as the SP500 future didn't react.
Markets opened up flat and slowly melted in a downward fashion with the bulls and bears in a tug of war on moderate volume.
A gathering cloud of enthusiasm is being generated by some financial analysts seeing blue financial skies ahead. I am not ready to jump on that train just yet as the light in the tunnel may be another train bearing down upon Mr. Market. There are way too many financial 'issues' still remaining to be addressed and solved. Personally, I am looking for a 5.5% correction to happen at any time. More than likely towards the end of March when the debt ceiling talks are in play.
There’s a growing consensus that it’s clear sailing ahead. In fact more and more analysts believe the “new normal” which began as the financial crisis unfolded is over and the “old normal” is back. We’ll see. There’s a disconnect between Wall St. and Main St., and when so many line up on one side, sit up and pay close attention.
The RRR** has been narrow at the opening bell for the past several months and continued the trend again this morning. 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 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 several years.
I also have continuing issues with some pundits, writing almost every day, that there are setups for day trading. Best Stock Market Indicator Ever: Unchanged at 79% and Secondaries Confirm "Tradable" 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. I keep hoping for increasing volumes to signal improved trading.
Swing trading is also at your own risk for all the reasons mentioned above although guessing overnight trades would have been most profitable. Again, 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 13657 up 8 or 0.06%.
The SP500 is at 1485 down 0.81 or -0.05%.
SPY is at 148.34 up 0.01 or 0.01%.
The $RUT is at 892.18 down 0.62 or -0.07%.
NASDAQ is at 3129 down 5 or -0.16%.
The longer trend is up, the past months trend is bullish and the current bias is down.
WTI oil was up slightly this morning and is currently trading up at 95.87 trading between 95.00 and 95.89 and the bias is positive.
Gold was down slightly this morning. Currently trading up at 1689.69, trading range is between 1684.32 and 1694.10 with a negative bias.
Dr. Copper is at 3.69 down from 3.70 earlier.
The US dollar fell from 80.15 earlier to 79.79 and is currently trading up at 79.97.
** RRR = Risk Reward Ratio
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Written by Gary