March 4th, 2013
in Gary's blogging
Midday Market Commentary For 03-04-2013
Volume has fallen below anemic, if that is possible, and the markets are drifting sideways with a slight bullish tint. Any movement today is contributory to the HFT algo computers because no human is about to test the waters.
The $VIX is descending from 16.17 to 15.14 and $TRIN is sliding sideways inline with the slight trend upward. The trading range is tight and narrow.
The RRR** has been narrow at the opening bell for the past several months, over a year actually, 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 86% and Secondaries Confirm "Tradable" This may be true enough, but difficult to believe, 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 12:15 is at 14065 down 23 or -0.17%.
The SP500 is at 1516 down 2 or -0.10%.
SPY is at 151.97 down 0.16 or -0.11%.
The $RUT is at 912.58 down 2.17 or -0.14%.
NASDAQ is at 3166 down 4 or -0.11%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been neutral to bearish and the current bias is sideways with a slight slant upwards.
WTI oil is trading between 93.12 and 89.53 this morning. The session bias is negative and is currently trading down at 89.77.
Brent crude is trading between 108.88 and 107.73 this morning. The session bias is negative and is currently trading up at 108.14.
Gold fell from 1587.00 earlier to 1565.10 and is currently trading down at 1571.75.
Dr. Copper is at 3.51 up from 3.48 earlier.
The US dollar is trading between 82.28 and 82.52 and is currently trading down at 82.39, the bias is currently sideways.
** RRR = Risk Reward Ratio
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Written by Gary