Monday, December 7, 2009

State of the Market - 12/7/09

I once again have very little to say today simply because very little happened. Stock rose slightly early on, fell slightly into the final hour, and then bounced to close basically flat on the day. Volume was lower compared to Friday's heavy totals and just about the same compared to the rest of last week.

Technically, we are still just locked in a range here and that makes swing trading difficult. As I said last night, I did nothing today and will likely continue to do nothing until we break this range one way or the other. Both oils and financials were lower today and appear poised to breakdown soon - if that happens, then I would assume the market overall will breakdown as well. There are certainly enough reasons for it to do so, and the possibility of us putting in a slow top here is very high. It's not certain, and a break to new highs would have me reconsidering my views, but that's the way I am leaning right now.

I don't know how comfortable I feel getting short yet - I want to see some confirmation first - but I will go through my scans tonight to see if I see anything interesting. I certainly didn't this weekend and I doubt one day will change things. To wrap up, I will be remaining patient and mostly if not totally in cash as sometimes that is the best play in the stock market. Until we break this range, I think now is one of those times. Take care.

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