Opening Market Commentary For 12-12-2012
Premarket was higher than yesterday’s close and melted downward after the markets opened this morning on relatively heavy low volume. By 10:15 the volume dried up as fast as it formed. Obvious selling and the ‘dippers’ are waiting for the FOMC meeting this afternoon.
I suspect we will continue to see drifting of the averages until we get word of the FOMC intentions.
The RRR** has been narrow at the opening bell for the past several months and continued the trend again this morning. This continuing trend makes predictions of session movements nearly impossible making trading futile and unprofitable.
As long as market volume remains light or the trading range is narrow, one can expect successful trading to remain elusive. The RRR** has been wider on volatile sessions lately and is expected to become more so as the year ends, but a lot of guessing still 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 this past year.
I also have issues with some pundits writing almost every day that there are setups for day trading. 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. Watch for increasing volume to signal improved trading.
Swing trading is also at your own risk for all the reasons mentioned above. Because the market is at a crossroads of sorts, I would prefer to sit on my hands as the markets are currently untradable. 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 13372 up 25 or 0.19%.
The SP500 is at 1430 up 3 or 0.23%.
SPY is at 143.76 up 0.34 or 0.24%.
The $RUT is at 835.68 up 0.72 or 0.09%.
NASDAQ is at 3025 up 3.03 or 0.10%.
The longer trend is up, the past months trend is bullish and the current bias is down.
WTI oil was up today and is currently trading sideways at 86.88 trading between 85.75 and 87.17 and the bias is positive.
Brent crude was up today and is currently trading down at 109.77 trading between 108.15 and 110.20 and the bias is positive.
Gold was up this morning. Currently trading down at 1716.14, trading range is between 1708.60 and 1718.80 with a positive bias.
Dr. Copper is at 3.69 down from 3.71 earlier.
The US dollar fell from 80.24 earlier to 79.98 and is currently trading up at 80.03.
** RRR = Risk Reward Ratio
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Written by Gary
