Opening Market Commentary For 08-13-2013
Premarkets were up 0.30% even after the morning 'not-so-good' financials (see chart below) were reported.
The markets opened up in the green, about 0.20%, and began a sea-saw action where the bulls and bears were battling it out – well, sort of. The volume was anemic suggesting the only ones trading was the HFT folks and the crooked DaBoyz. Most investors, at this point, are highly skeptical of Mr. Market and what brazen plans he has for the cash crowd. The green changed quickly to red as the bears took control.
By 10 am the averages were in a down trend while traders were awaiting the BTFD folks to step in, but the decline is relatively deep as red volume is increasing. However, if prior sessions are any indication of today's action, we will see the morning numbers climb out of the red by noontime and then slide sideways until the close.
The 'not-so-good' reporting is primarily the cause of this morning decline. The first column is what was reported this morning. The second column is what analysts were expecting and the third is the last report.
The RRR** was narrow at the opening bell today continuing a recent trend. This trend of low volume and narrow trading sessions makes any predictions of session movements nearly impossible, thus making trading futile and mostly unprofitable.
As of right now, it is too late to jump in to catch the market highs, safely anyway. Traders need to be especially cautious how close you set your stops as we have seen lately several corrections that unnecessarily wiped out a lot of investment profits. Also need to be careful of the opening traps. Yesterday we saw a bear trap and today the opening looked somewhat like a bull trap as the markets appeared to be easing up at the opening.
As for shorting, it still may be too early to start picking out your best candidates because Dr. Ben's QE∞ is still an ongoing program handing out free ice cream. As long as the sheeples enjoy the free ice cream, the longer this bull run will continue and guessing what Mr. Market will do next.
Correctly 'guessing', of course, is the tricky part of the successful trading equation lately. Any trades today will probably end up on the meager side of profitability if you are lucky as most daily trades have been less than optimal during the past several years.
There is a wedge between perception and reality that has been going on for some time now where the reality doesn't match this continued 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.
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 15344 down 72 or -0.46%.
The SP500 is at 1683 down 6 or -0.36%.
SPY is at 168.55 down 0.55 or -0.32%.
The $RUT is at 1047 down 7 or -0.65%.
NASDAQ is at 3651 down 19 or -0.50%.
NASDAQ 100 is at 3109 down 16 or -0.51%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been negative and the current bias is bearish.
WTI oil is trading between 107.18 and 105.60 today. The session bias is negative and is currently trading down at 105.73.
Brent crude is trading between 108.59 and 107.74 today. The session bias is negative and is currently trading down at 107.98.
Gold fell from 1340.69 earlier to 1323.00 and is currently trading up at 1328.80.
Dr. Copper is at 3.302 falling from 3.342 earlier.
The US dollar is trading between 81.44 and 81.88 and is currently trading up at 81.86, the bias is currently bullish.
** RRR = Risk Reward Ratio
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Written by Gary