Wednesday, March 2, 2011

State of the Stock Market - 3/2/11 - "Difficult to Discern"

Messy.  Choppy.  Frustrating.  Confusing. Dangerous.   All words that can describe today's action on Wall Street.   The market started the day with a nice bounce but that bounce ended quickly and sharply around 11:00.   Another bounce ensued at 12:00, but that bounce failed as well.  Around 2:00, stocks got going once again, but that met the same fate as the others with the indices selling off again into the close.   The Nasdaq did finish with gains but ended in the middle of its intraday range.   The S&P closed only slightly higher.   Volume looks to be lighter.

I'll be honest - I really don't know what to expect tomorrow.  I'll post this chart and let you decide for yourself.  It's a three day chart (5 minute) of the Nasdaq - we are coiling down here and a break of those lines maybe give us a clue as to whether this market is going to indeed roll over or break the bears again. 

Overall, be careful.   I was already stopped out of one of my shorts from yesterday and remain mostly in cash.   Headfakes are definitely a possibility.   Good luck Thursday.

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