February 25th, 2013
in Gary's blogging
Midday Market Commentary For 02-25-2013
By 11 am many of the major averages had dipped below the closing numbers of Friday – so much for today's big gap up. This morning rise is just DaBoyz dipping their hands into the sheeples pockets once more.
By noon the averages were fall unabated. Update shortly.
The RRR** has been narrow at the opening bell for the past several months and has continued the trend into the midday session. This continuing trend makes predictions of session movements nearly impossible making trading futile and unprofitable. As of right now, it is too late to jump in to catch the highs and still may be too early to start shorting.
As long as market volume remains light or the trading range is narrow, one can expect successful, or at least profitable, trading to remain elusive. The RRR** has been wider on some volatile sessions lately and is expected to become more so as 2013 enters the first quarter, but unfortunately 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: Rises to 85% 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 over the past year. 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 14069 down 63 or -0.45%.
The SP500 is at 1508 down 7 or -0.46%.
SPY is at 151.12 down 0.76 or -0.52%.
The $RUT is at 910.19 down 6 or -0.65%.
NASDAQ is at 3155 down 6 or -0.20%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been bullish and the current bias is down.
** RRR = Risk Reward Ratio
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Written by Gary