January 25th, 2013
in Gary's blogging
Closing Market Commentary For 01-25-2013
Markets melted up the entire session with mini-bear traps thrown in for good measure to catch anyone not paying attention. After calling around to my colleagues to see who is buying or selling I find that they are sitting on their hands like I am. Mostly lighting their portfolios to 'catch' the next dip which 'everyone' is certain to happen sooner than later seems to be the trend.
With the Q4 earnings coming in far worse than anyone suspected the HFT computers keep melting up the markets.
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 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 4:00 is at 13895 up 70 or 0.51%.
The SP500 is at 1503 up 8 or 0.54%.
SPY is at 149.92 up 0.84 or 0.56%.
The $RUT is at 905.24 up 5 or 0.56%.
NASDAQ is at 3149 up 19 or 0.62%.
The longer trend is up, the past months trend is bullish and the current bias is down.
WTI oil was up this morning and is currently trading down at 95.98 trading between 95.46 and 96.56 and the bias is negative.
Gold was down this morning. Currently trading down at 1658.65, trading range is between 1672.00 and 1655.28 with a neutral bias.
Dr. Copper is at 3.65 down from 3.71 earlier.
The US dollar fell from 80.17 earlier to 79.74 and is currently trading up at 79.83.
The 500 at the close.
The DOW at the close.
** RRR = Risk Reward Ratio
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Written by Gary