May 20th, 2013
in Gary's blogging
Opening Market Commentary For 05-20-2013
Premarkets were down -.020% with no important news coming out of Europe, appears to be an ordinary Monday morning start.
Markets did open down but soon began to melt up to Friday's highs where the small caps made new highs by +0.01% on low volume. By the 15 minute mark the averages started to melt down again +0.08% to +0.19% on moderate volume.
By 10 am the small caps were the first to report a small gain of +0.01% to +0.05% as the BTFD crowd timidly stepped in to melt the averages back up to previous morning highs. I do not see this market going anywhere, in a radical way, today except for a sea-saw action.
The RRR** has been narrow at the opening bell for the past several months, over a year actually, and it looks like it is going to be this way all week, like last week. 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, safely anyway and be careful how close you set your stops. As for shorting, it still may be too early to start picking out your best candidates, but I feel you will not have to wait much longer.
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 second quarter, 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: Stays At 96% Unchanged From 96% and Secondaries Confirm "Tradable" This might be true, but still above ~60% where I think it should be! Hard to believe and challenging to deal with considering 'not so good' current events. There is a wedge between perception and reality going on right now where the reality doesn't match this bull run.
The trading range has been so narrow that way too much 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 10:15 is at 15346 down 5 or -0.04%.
The SP500 is at 1668 up 1 or 0.05%.
SPY is at 167.13 up 0.23 or 0.11%.
The $RUT is at 997.15 up 0.87 or 0.09%.
NASDAQ is at 3504 up 5 or 0.14%.
NASDAQ 100 is at 3030 up 1 or 0.03%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been bullish and the current bias is positive.
WTI oil is trading between 95.52 and 96.33 today. The session bias is neutral and is currently trading up at 95.96.
Brent crude is trading between 103.85 and 104.75 today. The session bias is neutral and is currently trading up at 104.44.
Gold rose from 1340.06 earlier to 1363.50 and is currently trading up at 1353.95.
Dr. Copper is at 3.324 rising from 3.282 earlier.
The US dollar is trading between 84.04 and 84.39 and is currently trading up at 84.19, the bias is currently positive.
** RRR = Risk Reward Ratio
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Written by Gary