January 22nd, 2013
in Gary's blogging
Midday Market Commentary For 01-22-2013
Very bullish and very overbought is one way to describe the market based on the S&P. I would be very careful on any positions taken right now. Personally, I need to see where the markets are going to go in relationship to the current resistance levels.
By noon we were right where we started this morning except the volume has fallen off. Flat, mixed and lackluster.
The RRR** has been narrow at the opening bell for the past several months and continued the trend 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 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 12:00 is at 13666 up 18 or 0.13%.
The SP500 is at 1485 down 0.15 or -0.01%.
SPY is at 148.46 up 0.12 or 0.08%.
The $RUT is at 895.19 up 2.39 or 0.37%.
NASDAQ is at 3127 down 8 or -0.25%.
The longer trend is up, the past months trend is bullish and the current bias is neutral.
WTI oil was up slightly this morning and is currently trading up at 96.19 trading between 95.00 and 96.19 and the bias is positive.
Gold was down slightly this morning. Currently trading up at 1695.31, trading range is between 1684.32 and 1695.60 with a positive 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 down at 79.99.
** RRR = Risk Reward Ratio
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Written by Gary