Markets Melt Up From Morning Lows – Remain Lackluster

January 28th, 2013
in Gary's blogging

Midday Market Commentary For 01-28-2013

Markets rose after disappointing news that Pending Home sales fell a whopping 4.3% while expecting 0.0%. The prior report was +1.6%.

At noon the markets climbed back up to mostly positive, but remaining flat and uninteresting just like the 5 previous sessions. The melting up smacks of HFT algo interference when volume levels are low. The day isn't over, but I suspect we will see the averages report in lower numbers by the session ending bell.

Follow up:

Leavitt has expressed my views exactly.


The most bearish comment I can make right now – and this is very bearish – is that everyone is bullish.

The bears have completely left the room – or at least they’re not making any noise – and the bulls are loud and proud and pounding the table 2013 is going to be a great year.

So far this looks to be the case, but you gotta start to wonder when they need to be brought back to earth.

If the bulls have already taken their positions, who’s left to push prices higher?


Really?  9 out of 10 S&P 500 stocks now have a positive Strength level?

The actual percentage of S&P stocks with positive Strength was 90.4% at the close on Friday.

This is the third time since January 4th. that this level has appeared. So Friday's level is the third time it was getting close to the 90.8% level.

What is one way of describing 9 out of 10 stocks with positive Strength?   The answer is "Overbought".

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 13897 up 5 or 0.03%.

The SP500 is at 1502 down 0.19 or -0.01%.

SPY is at 150.16 down 0.09 or -0.06%.

The $RUT is at 905.42 up 0.17 or 0.02%.

NASDAQ is at 3160 up 10 or 0.31%.

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 up and then turned down this morning and is currently trading up at 96.31 trading between 96.80 and 95.75 and the bias is negative.

Gold was trading down and has turned up this morning. Currently trading up at 1654.47, trading range is between 1662.15 and 1652.35 with a neutral bias.

Dr. Copper is at 3.66 down from 3.67 earlier.

The US dollar fell from 79.99 earlier to 79.79 and is currently trading down at 79.85.

** 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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