Midday Market Commentary For 02-12-2013
By the 12 o’clock hour the averages were still elevated and generally above yesterday’s numbers but remaining mixed and directionless. Although the bias appears to be somewhat positive the swings are getting smaller on falling volume I am suspecting a minor sell-off later today. The whole action today also appears to be the work of the algo HFT computers as I don’t know anyone actively trading in this market. It seems a lot of us are unsure as to the future and would rather wait for Mr. Market to make his move.
The RRR** has been narrow at the opening bell for the past several months and has continued the trend into the midday session. This continuing trend makes predictions of session movements nearly impossible making trading futile and unprofitable. As of right now, 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 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 12:15 is at 14010 up 40 or 0.28%.
The SP500 is at 1519 up 2.37 or 0.15%.
SPY is at 151.99 up 0.23 or 0.15%.
The $RUT is at 916.23 up 3.21 or 0.35%.
NASDAQ is at 3190 down 0.2 or -0.06%.
The longer trend is up, the past months trend is bullish and the current bias is neutral with a positive slant.
WTI oil was up this morning and is currently trading sideways at 97.48 trading between 95.07 and 97.80 and the bias is slightly negative.
Brent crude was up earlier and is currently trading up at 118.24 trading between 117.50 and 118.91 and the bias is negative.
Gold was generally down this morning. Currently trading up at 1652.11, trading range is between 1668.30 and 1639.08 with a positive bias.
Dr. Copper is at 3.74 up from 3.72 earlier.
The US dollar fell from 80.59 earlier to 79.99 and is currently trading down at 80.07.
** RRR = Risk Reward Ratio
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Written by Gary