Thursday, October 28, 2010

State of the Stock Market - 10/28/10

It's my birthday and I will be taking my two boys trick or treating in a few hours, so today's commentary will be short.   Really, we saw more of the same today overall - a market that is moving a lot intraday but not really going anywhere overall.  I said last week that with the breadth signals I follow flashing warning signs, we likely will either top out here or have a choppy consolidation period that lets those signals work themselves out a bit.   So far, the market has not yet cracked, so the trend remains up. 

I overall remain neutral.   If the market has a big selloff on heavier volume, I think it could be enough to get a good pullback going.   If the market has a big move higher on heavier volume, I think it will be a sign that the market has more tread left for further gains.   Right now, however, nothing is really going on - the Nasdaq is slightly higher than it was two weeks ago and the S&P is at about the same spot.

I made one trade last night after-hours, entering IRBT at $20.90 as an earnings trade.   When it opened around $22, I was impressed and set my stop at $20.85, figuring that if it fell that far after opening so well, it wasn't worth holding as an earnings trade (it is my experience that the best earnings trades rarely sell off intraday).   I was stopped out in the morning, but got a poor fill at $20.65 (Thanks Scottrade!) so I took a small loss there.   I saw quite a few nice setups last night but none did anything today.   I remain in cash.

Good luck out there - we need a big move one way or the other to tell us where the market wants to head next but neither the bulls or bears seem strong enough to get that done.   The Worden Report keeps talking about a "holding pattern" until the election, and perhaps that's what we're seeing.   Take care.


Sint said...

Happy Birthday!!

Anonymous said...


Look into move I make in a fills are better and commsions much less....


Mac said...

Sint - Thank you.

Elio - I will check it out - I haven't been trading as much overall but maybe I should think about switching.

positiontrader said...

Happy Birthday Mac! Here's wishing you a great year ahead!

Anonymous said...

You me and Bill Gates