Monday, April 12, 2010

State of the Market - 4/12/10

A slow day today on Wall Street, as stocks closed slightly higher but the trade was lackluster and quite slow based on my quote screen.   The S&P traded in about a five point range the entire session.   Volume looks like it was quite weak and today will likely be the third consecutive day of higher prices on decreasing volume.

Technically, same old story - the market keeps going up on lower volume.   I am starting to get that feeling again that we are due for a pullback (probably just one of those one-day variety ones) but my gut was wrong last week so it may be wrong again.   If anything, I would be a little more cautious about buying stocks after today.   I know I am going to be.   Individual stocks didn't act great today - a lot of fade jobs in the stocks I was watching.

I di made a few trades today - first I was stopped out of DEER at $11.36 for a 3.6% loss.   I really thought Friday could have been an important reversal day but it wasn't.   That's what you get when you anticipate.   I also entered two longs today - EGI at $3.09 and BZH at $5.   Both of these moved nicely higher from there, but EGI gave it all back and I was not impressed at all with the action.   I may be out of that one soon - gold might need a rest overall as well.   BZH faded as well but I have a little cushion so I'll hold it. 

From last night's video, there were some big movers (PDO was up about a $1.70 at its peak - great for daytraders) but most of these movers (ULTA, SMCI, BZH, EGI) closed weak.   FRPT had a decent session but I passed on it early on due to volume.   CADC had a nice little breakout from a coiling pattern but I also passed here as I have enough longs for my taste right now, at least until some of my current longs take off.

In fact, I may look to unload some of these long positions that are just sitting there doing nothing tomorrow.   SEED and NEP are two that have had no movement the past two days and just don't seem to have much momentum.   I hope I am not getting impatient here, but I just get the sense that we are not at a great point for holding stocks for several weeks as swing trades.   I was hoping for some one or two day  moves out of these but haven't gotten that yet.   We'll see how they perform tomorrow.  

That's about it for today - we're in a position where a pullback won't surprise me.   The 9 day moving averages are at 1185 and 2432 for the S&P and Nasdaq respectively and that has been the magic spot for any pullback we've had so I would watch it closely.   And if we grind higher again tomorrow I might just look to unload some longs going into the start of earnings season.   That's going to be a fun time - we'll have to see what expectations look like and how the results will meet up.   Good luck Tuesday.

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