Monday, December 10th Recap
Lethargic is probably the best way to describe the market today, as it gimped along to start the day before it started to slowly roll over. On the 5-minute chart, we can see that 142.80 was significant resistance, as it was quickly pushed down .50 cents. Selling did pick up at the end of the day today, and it appears that until the fiscal cliff dilemma is figured out, we may just limp around until a firm trend is established. A slow and lethargic market is typically not good for the bulls, so be very prepared and chose your day trades wisely. Overall, the SPY chart still remains bullish - however today just seemed to have a weird feel to it. Not many traders are committed to positions right now, and I do see a pull-back in our future. The key here is if it is controlled selling or a panic sell related to the Fiscal Cliff news.
Today was another rough day for the high beta stocks. PCLN got downgraded in the pre-market and took an absolute beating. As it finished the day in a bear flag, I think we'll see lower prices soon (620 and then 610). AAPL still shows indecision, also not a good sign for the bulls. If 528 can't hold, look out below - as we'll soon be testing the lows of 11/16. GOOG is holding on to 685 like it is life support, and a dip on significant volume will be the final straw. I think 674 is a high probability of being printed this week.
As far as the sectors are considered, the industrials are still the market leaders (just as we posted yesterday in our Weekly Watch). We may start to see some resistance up at 37.80, so my advice is to buy on the pull backs. 37.00 would be a great entry if you can get it, but I think 37.20 will also fare well. The one industrial still on my watch list is CMI, with a potential move to 110 I like where its headed.
The financials are also holding higher, and you can just feel that they are waiting for an answer out of Washington. Until then we will see some tough and annoying market action, so don't feel like you're compelled to trade anything. Now is a time to relax and observe, rather than force trades.
Overall, the market just has a general lull feel to it. Not much is happening and there is just no incentive to press big trades with the Fiscal Cliff on the back burner. On top of that we can expect that most traders are re-positioning their portfolios to set themselves up for 2013, or they are out of the office not really trading. I am not expecting much as of now, but I am definitely keeping a watch on potential easy trades.
For now, I am currently long December calls in MNST, LNKD, and FB and I will be monitoring them very closely this week. Tight stops are key to an indecisive market.
Today was another rough day for the high beta stocks. PCLN got downgraded in the pre-market and took an absolute beating. As it finished the day in a bear flag, I think we'll see lower prices soon (620 and then 610). AAPL still shows indecision, also not a good sign for the bulls. If 528 can't hold, look out below - as we'll soon be testing the lows of 11/16. GOOG is holding on to 685 like it is life support, and a dip on significant volume will be the final straw. I think 674 is a high probability of being printed this week.
As far as the sectors are considered, the industrials are still the market leaders (just as we posted yesterday in our Weekly Watch). We may start to see some resistance up at 37.80, so my advice is to buy on the pull backs. 37.00 would be a great entry if you can get it, but I think 37.20 will also fare well. The one industrial still on my watch list is CMI, with a potential move to 110 I like where its headed.
The financials are also holding higher, and you can just feel that they are waiting for an answer out of Washington. Until then we will see some tough and annoying market action, so don't feel like you're compelled to trade anything. Now is a time to relax and observe, rather than force trades.
Overall, the market just has a general lull feel to it. Not much is happening and there is just no incentive to press big trades with the Fiscal Cliff on the back burner. On top of that we can expect that most traders are re-positioning their portfolios to set themselves up for 2013, or they are out of the office not really trading. I am not expecting much as of now, but I am definitely keeping a watch on potential easy trades.
For now, I am currently long December calls in MNST, LNKD, and FB and I will be monitoring them very closely this week. Tight stops are key to an indecisive market.