Opening Market Commentary For 02-06-2013
Just a few opening remarks this morning as the markets opened lower and then recovered to yesterday’s closing numbers. Volume is low and investors are waiting for something to happen, just what is anyone’s guess.
This market needs a breather and perhaps we are witnessing it, but the jury is still out on whether or not we are going to continue up or take a fall.
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. It is too late to catch the highs and may be too early to start shorting.
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 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 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: Unchanged at 87% and Secondaries Confirm “Tradable” 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. 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. 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 13944 down 33 or -0.24%.
The SP500 is at 1509 down 2 or -0.15%.
SPY is at 150.87 down 0.19 or -0.13%.
The $RUT is at 906.04 down 2 or -0.24%.
NASDAQ is at 3165 down 6 or -0.21%.
The longer trend is up, the past months trend is bullish and the current bias is up.
WTI oil was down this morning and is currently trading up at 95.69 trading between 97.72 and 95.03 and the bias is positive.
Brent crude was down earlier and is currently trading up at 116.14 trading between 117.25 and 115.72 and the bias is neutral.
Gold was trading erratically this morning. Currently trading sideways at 1676.06, trading range is between 1662.25 and 1684.60 with a somewhat positive bias.
Dr. Copper is at 3.74 down from 3.78 earlier.
The US dollar rose from 79.49 earlier to 79.92 and is currently trading sideways at 79.81.
** RRR = Risk Reward Ratio
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Written by Gary