Markets Close Higher Among Heavy Profit Taking

May 15th, 2013
in Gary's blogging

Closing Market Commentary For 05-15-2013

Looking more and more like a reactionary market and short covering appears to be the BIG driving force today say several analysts. Analysis in our office are not saying much to take side with either the bulls or the bears; each has its own story why Mr. Market should go their way. Most averages either set new historical highs, most notably the DOW and the SP500, while mostly small caps set new inter-year highs. Notably, the $NDX closed above 3000 in November 2000.

Markets closed up after an eye popping roller coaster ride for many with a heavy spurt of heavy profit taking at today's closing bell. The general feeling on the street is that the markets are overbought (not that has stopped a bull market before) “. . But until we get real sell signal it's dangerous to try and short.” says DailyFX and I would agree.

Follow up:

I said this at noon, but I'll say it again. "Think twice before jumping into this fray."


The Other Great Rotation - From Reach-For-Yield To Dash-For-Trash

It appears that the only thing driving this market higher now is shorts covering.

The 'most shorted' names (as we first suggested here) have tripled the performance of the market in the last 4 days (+5.2%).

Simply put, this is not a reach-for-yield anymore (which is somehow pitched as a reasonable conservative 'ah shucks' thesis to be buying stocks), this is a dash-for-trash (at a time when financing for this trash is actually blowing higher) - and that always ends well...

The DOW at 4:00 is at 15276 up 60 or 0.40%.

The SP500 is at 1659 up 8.44 or 0.51%.

SPY is at 165.96 up 0.73 or 0.44%.

The $RUT is at 988.54 up 2.58 or 0.26%.

NASDAQ is at 3471 up 9 or 0.26%.

NASDAQ 100 is at 3002 up 6 or 0.22%.

The longer trend is up, the past months trend is bullish, the past 5 sessions have been bullish and the current bias is bullish.

How Oil Really Gets Priced

WTI oil is trading between 94.43 and 92.20 today. The session bias is bullish and is currently trading back up where it started this morning at 94.34.

More Widening For The Brent/WTI Spread ahead?

Brent crude is trading between 103.58 and 100.91 today. The session bias is bullish and is currently trading up at 103.55. (Way above where it started this morning.)

Gold fell from 1428.63 earlier to 1387.94 and is currently trading down at 1391.95.

Here’s why copper has lost its indicator role

Dr. Copper is at 3.268 falling from 3.311 earlier.

The US dollar is trading between 83.66 and 84.21 and is currently trading down at 83.95, the bias is currently neutral with a possible positive slant.

The 500 at the close.

The DOW at the close.

P.S. Cisco beat revenue by 2 B and estimates by 2 cents.

To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

Written by Gary

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