Friday, February 4, 2011

State of the Stock Market - 2/4/10 - "Uninspired"

A slighty positive session today on Wall Street, but really it was kind of a snoozer, as volume was low and trading seemed uninspired at best.  The lows for the Nasdaq and S&P were put in quickly this morning and from there, stocks bounced slowly to finish near their highs for the day.  

Technically, the Nasdaq finished just slightly above important resistance and therefore did close at new highs for the year.  That is positive, but I really don't like seeing volume as low as it was.   There just didn't seem to be much enthusiasm today from the bulls.  Something about this market still just doesn't feel quite right to me - I don't exactly know what it is.   I am not saying this market can't go higher - actually, I think it probably will.  I guess I just think it is a tricky time to trade right now.   There are "fish" out there, but they're more in a really big swimming pool rather than a barrel if that makes sense.   It is not an "easy" market.

One thing that has made things tricky for me this past week is that there definitely seems to be some rotation going on in this market from smaller-cap companies to bigger-cap ones.   Perhaps this is one reason why I keep saying that I see very few exciting setups in my scans.   Stocks like LULU, CMG, NFLX, and GMCR acted well today.   Names like REDF, DQ, and CBPO (names I've had on my lists recently) acted poorly today.  We'll see next week if this continues to play out but it is definitely something I am going to take into consideration for the near future.   The Russell 2000 is the only major index that I follow that has not gotten past its January resistance, and that is meaningful.

Overall, if you have setups you like, there is no reason not to take them - just be careful.  I am seeing a lot of breakouts that are not following-through like they did at the start of the year.   I am seeing a good bit of reversals in stocks that had nice moves the day before.   I would shorten my time frame in general and shrink my position size in most cases but that's just me.   I remain in cash right now and really am not complaining.

I don't know if I will have a post up this weekend - my Steelers are going to be a little busy Sunday, and since I don't exactly have the best feeling about the outcome, I don't know how much my mind will be on stocks.   Take care and enjoy your weekends. 


bmbull said...

Go Packers. Sorry Mac. :)

Born and bred in WI, I gotta take the other side of this one! Should be quite a battle.

Mac said...

Really tough matchup for my Steelers. I am hoping we can grind it out by running the ball and maybe Troy can make a play or two on defense to win the game. It should be a good game regardless.

Green Bay is set up for quite a run themselves. Put Finley on this team and take out Rodgers's concussion and they probably are more like 13-3 than 10-6. Let the Steelers win one more and then the Pack can get two or three in a row. :-)

Anonymous said...

Goooo Steelers!

I too hope Troy can get back in the game. It's almost like he's been AWOL in the playoffs.

But Big Ben is clearly in command of the field.

bmbull said...

Yeah, the Pack had a pretty rough year on the injury front, and lost a few games they should have won. But they seem to be putting it all together at the right time. The last couple of wins of the regular season (NYG, CHI) were both real gut checks, and they won all three playoff games on the road.

Reminds me of the Steelers of a few years ago -- weren't they a #6 seed when they won SB XL?

Don't underestimate the Steelers this year, though, either. That defense can be a monster.

Well, here's to hoping that both teams play well.

JP said...

The market's been good to me this week. I'm in seven positions now and most have followed through very nicely. Stops are set tight though, and the positions are all fairly small relative to earlier this year.

As for football, I couldn't care less so may the [insert your favored team here] win! :)

Anonymous said...

i recharted dow, the target zone is 1212x~1214x, cant be more precisely for me. :(

for GS, i entered below 164 but not near the daylow. i maynot buy more if it swings above 165.5x next week.