Monday, December 6, 2010

State of the Stock Market - 12/6/10 - "Consolidation Day"

A pretty slow day today on Wall Street, as stocks started lower, fought back to regain the early losses, and finished mainly flat on the session.   It is good to see dip buyers continue to come in and be there - it wasn't like this morning was a major selloff, but the market still bounced back which is a big positive.   After the big gains last week, the market had a right to sell off, but a few more days of this type of consolidation would be even better.  Volume appears to be quite low today.

Technically, we continue to be in an area where we may consolidate, but there is nothing that says we can't go higher first.   The small caps continue to lead (Russell 2000 outperformed today) and that is also always a good sign.  Overall, things remain bullish and it certainly appears any dips back to the short-term moving averages are simply buying opportunities (as I mentioned this weekend).

As I continue to do research and decide on a broker to switch to from Scottrade, I remain out of the market - it kind of stinks but I accept it.  Right now, I am thinking about Think or Swim, Interactive Brokers, and Trade King.  This is not a decision I want to jump into without doing research however, so I am doing my due diligence now to hopefully avoid the type of mess I was put in by Scottrade.  When I do pick a broker (, it will still take probably a week or two for things to clear, so I may not be trading myself until the New Year.    I do hope, however, you have been able to benefit from my videos - we had some nice winners today.

Both REE (+14%) and CCME (+11%) were highlighted in this weekend's video as potential movers and both obviously acted well today.  HTHT is the only one the acted "poorly" and I would take that off any watchlists you may have for the time being.  Most of the setups are still valid but you may want to wait for a bit more consolidation in the overall market.

That's about it for today - good luck Tuesday.

1 comment:

MorninTrader said...

You just named three VERY (VERY) different brokers.

ToS has good free software and data feeds, but they're filtered and can go down. The commissions are higher than most.

Tradeking is web only, no bracket order, level 2 data, anything. I'd only use it for long term investing.

IB has super cheap commissions. If you trade $30 a month in commissions everything is free. The software is not great and takes a lot of time to get used to. The data is also very slow and filtered. You can pair it with NinjaTrade + Kinetick (or esignal but it costs more and isn't as good) if you want great software and unfiltered tick data. Going to run you ~$150 a month.

Tradestation also fits some people's needs. If you trade over 5k shares the software is free. The software is great, but you still have to pay commissions and it can cost a lot if you don't hit 5k shares. The per share commissions are almost couple what IB is, but they're still less than most.

If you want to keep everything on the cheap. Put 2k in a ToS account and just use their software. Then trade from IB. No data fees and the cheapest commissions you can get.