Remain Open-Minded and Flexible
By Rev Shark
RealMoney.com Contributor
4/13/2011 8:52 AM EDT
Life is not about how fast you run, or how high you climb, but how well you bounce.
-- James Koford
The market has been under pressure the last two weeks with the selling accelerating the last few days. We have seen consistently poor intraday action for a while and some ugly technical breakdowns yesterday, particularly among the more thinly traded issues. Apple (AAPL) and a number of other key leadership stocks have been struggling and the dip-buyers have not been showing much interest.
Despite the negatives, the selling pressure has been intense enough for long enough to create oversold conditions that are helping to produce a bounce today. Earnings from JPMorgan Chase (JPM) beat expectations and that is helping. After a sharp drop over the last couple days, crude oil is also stable and that is helping to boost the commodity sector.
The market is now in the classic situation now of having suffered some technical damage but it's oversold enough for some sort of relief bounce. This marks a point in the market that has been quite tricky over the last two years. It makes sense to expect some sort of relief rally, but once the market starts to bounce, investors seem to forget all those negatives that mattered so much. So the market just keeps on running higher.
Logically, we should be looking for a failed bounce to develop at this point. Some upside for a couple days would relieve the oversold conditions and provide exit points for trapped bulls and entry points for aggressive bears. However, in this market that sort of thinking has been a recipe for trouble.
Anticipating a failed oversold bounce has been a nearly impossible trade and we have to wonder if this time it is going to be different. One added complexity is that earnings season is kicking off and that is going to determine the market mood. The first report of the season, Alcoa (AA) , was very disappointing but Google's (GOOG) report on Thursday evening will provide a better test.
President Obama's speech this afternoon in which he plans to set forth his budget plan could be another market moving event today. It will receive much attention but it is unlikely to have lasting market impact. The battle lines are already well drawn with the Democrats pushing for higher taxes and more spending while the Republicans insist we need to focus on making budget cuts. The market needs some fiscal discipline to keep inflation from building so any austerity measures will likely be seen as a net positive, although it is obvious the political battle will continue unabated.
At this juncture, the best trading opportunities are going to be some short-term bounces. The challenge will be to determine how far we can trust them. We will need to keep time frames short, stops tight and not be too trusting of an immediately recovery. It can be a good environment for opportunistic trading but quick reversals are a real danger.
It is a good time to stay open-minded and flexible. The action over the past couple weeks has been negative and there are strong indications it could continue. But the market is due for a respite so we might as well try to capitalize on it while we can.
February Business Inventories +0.5% vs +0.8% Briefing.com consensus; prior revised to +1.0% from +0.9%
Nagu arvata oligi, siis BIDU ja SINA-le sobib igasuguse kvaliteediga kütus. SINA avanes $114,77 pealt (+3%) ja peale esimest põrget $ 116 alla tuli aktsia korraks $ 115 tasemele tagasi ning on sealt alates aina ülespoole tiksunud. Hetkel kaupleb aktsia $117 kandis, 5,1% plusspoolel.
BIDU avanes $143,34 pealt (+1,9%), kuid aktsial võttis liikuma saamine natuke pikemalt aega kui SINA-l. BIDU põrkas peale avanemist $144 peale ning tuli seejärel avanemistasemeni tagasi. Sealt on aktsia ülespoole liikunud ja kaupleb hetkel $ 144,80 kandis, 3% plusspoolel.
BIDU avanes $143,34 pealt (+1,9%), kuid aktsial võttis liikuma saamine natuke pikemalt aega kui SINA-l. BIDU põrkas peale avanemist $144 peale ning tuli seejärel avanemistasemeni tagasi. Sealt on aktsia ülespoole liikunud ja kaupleb hetkel $ 144,80 kandis, 3% plusspoolel.
RBC prognoosib täna, et toornafta hinna nii-öelda „pullback“ ei möödu niipea ehk teisisõnu järgneva paari kuu vältel peaks hind pigem langema. Strateegide prognoosi demonstreerib allolev graafik, millel on kujutatud turul spekuleerijate neto lepingute arv (non-commercial traders) ning toornafta hind. RBC hinnangul langeb toornafta hind paari nädala jooksul ca $100le dollarile barreli kohta, kuna spekulatiivne nõudlus on turul eeldatavasti langemas. Strateegide sõnul hakkaks toornafta hinnalangus negatiivset mõju avaldama energiaettevõtete aktiatele siis, kui hind langeks ca $90 tasemele.
