Tuesday, April 28, 2009

State of the Market - 4/28/09

Another day, more chop. That's about all I can say right now, as we had another day of up and down movement that in the overall picture didn't take us anywhere. Futures were down a good amount in the pre-market and things looked ominous this morning, but much as they did yesterday, the bottom was put in on the opening gap down and stocks rallied right from there. They reached a high around 11:00, consolidated sideways until around 2:30, and then tried to break out again. That failed as stocks faded into the close, finishing basically flat and in the middle of their intraday range. Volume appears to be lower once again.

Technically, we are still in the range between 830 and 875 on the S&P and until we break out one way or the other, I don't know that I feel comfortable doing much. The Nasdaq is still below its high from Friday on the attempted breakout to new highs and hasn't been able to muster much the past two days. If you are a bull, you are probably looking at the past few weeks as much needed and healthy consolidation. If you are a bear, you are seeing the indices slow down here and possibly setting up a rounding, long-term top. I am still more bearish, but I know anything can happen so I am not discounting either of these outcomes. But as I said yesterday, with seasonality coming into play soon along with the end of these manufactured earnings reports for so many of the financials, I find it hard to believe we are just going to keep moving up and up for the rest of the year.

I was watching a few shorts today and almost went into one or two but we had a quick power outage that obviously shut down my computer and by the time I got connected the market was up 30 points. Sometimes you do get lucky I guess. I still don't have a good feel here and this chop could continue for a little longer in an effort to frustrated both bulls and bears alike. Sometimes the best trade is no trade at all and I am getting the feeling that may be the case right now. Be ready, but don't force anything. Sorry for the short posts the past two days, but there really hasn't been much to write about. Take care and good luck Wednesday.

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