Opening Market Commentary For 05-06-2013
Premarkets were flat this morning as not much happened over the weekend in Europe. The problems in the EU and the issues in Cyprus are still there and the bulls have run out of money – for the day anyway.
Markets opened flat and directionless with the small caps making a feeble attempt to rally which turned into a decent of sorts.
By 10 am the DOW was down -0.16% and the NASDAQ was up +0.20% and falling.
The RRR** has been narrow at the opening bell for the past several months, over a year actually, and it looks like it is going to be this way all week, like last week. This continuing trend makes predictions of session movements nearly impossible making trading futile and unprofitable. As of right now, it is too late to jump in to catch the highs, safely anyway. As for shorting it may be too early to start shorting, but I feel you will not have to wait much longer.
As long as market volume remains light or the trading range is narrow, one can expect successful, or at least profitable, trading to remain elusive. The RRR** has been wider on some volatile sessions lately and is expected to become more so as 2013 enters the second quarter, unfortunately 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: Rises to 92% up From 87% and Secondaries Confirm “Tradable” This might be true, but still above 60% where I think it should be! Hard to believe and challenging to deal with considering ‘not so good’ current events. There is a wedge between perception and reality going on right now where the reality doesn’t match this 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. 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 10:15 is at 14956 down 17 or -0.14%.
The SP500 is at 1615 up 1 or 0.08%.
SPY is at 161.60 up 0.25 or 0.15%.
The $RUT is at 958.20 up 4 or 0.40%.
NASDAQ is at 3388 up 10 or 0.30%.
NASDAQ 100 is at 2953 up 9 or 0.30%. (A lot of analysts are currently watching the 100 for a heads and shoulder formation.)
The longer trend is up, the past months trend is bullish, the past 5 sessions have been bullish and the current bias is flat.
WTI oil is trading between 96.44 and 94.94 today. The session bias is bearish and is currently trading down at 95.24.
Brent crude is trading between 105.15 and 103.91 today. The session bias is bearish and is currently trading up at 104.22.
Gold fell from 1478.06 earlier to 1465.44 and is currently trading up at 1467.75.
Dr. Copper is at 3.297 falling from 3.323 earlier.
The US dollar is trading between 82.04 and 82.29 and is currently trading up at 82.27, the bias is currently bullish.
** RRR = Risk Reward Ratio
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Written by Gary