Opening Market Commentary For 12-28-2012
Premarkets were down as one might expect from all yesterday’s after market political double-speak from the waring political parties in Washington. But they were only down to the mid point in yesterday’s movements leaving a lot of room to move in either direction this morning.
I have a 10 am meeting this morning so the opening market commentary report will be published a bit earlier than usual.
The markets opened down with a bearish slant. The DOW was down 70, SP500 down 9 and the NASDAQ down 20. Indicators are pointing for an upwards correction, so be on your toes for bull and bear traps this morning. More when I get back.
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 2012 ends and 2013 begins, but 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 year.
I also have continuing 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 9:45 is at 13024 down 72 or -0.55%.
The SP500 is at 1409 down 8.55 or -0.60%.
SPY is at 140.72 down 0.83 or -0.59%.
The $RUT is at 833.16 down 4.21 or -0.50%.
NASDAQ is at 2972 down 13 or -0.45%.
The longer trend is up, the past months trend is bullish and the current bias is down.
WTI oil was down this morning and is currently trading up at 91.17 trading between 91.49 and 90.79 and the bias is positive.
Gold was down this morning. Currently trading up at 1661.37, trading range is between 1665.70 and 1656.96 with a positive bias.
Dr. Copper is at 3.61 up from 3.59 earlier.
The US dollar is falling from 80.04 earlier to 79.71 and is currently trading down at 79.72.
** RRR = Risk Reward Ratio
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Written by Gary