From the Trading Desk

Stocks Rebound but Volume Falls

Positive economic data fails to lift stocks initially as the market focuses on Bernanke’s testimony. Europe continued to succumb to the Italian problem. Volatility dropped after jumping 34% yesterday, but despite the market rebounding volume did not follow. Monday’s have been low volume sessions for much of this year with Tuesday’s showing big volume. Today’s lack of volume shows institutions weren’t too keen on jumping back in the market. Late day buying helped push the market to the highs of the session. We remain in neutral mode and we do have a change in a short-term trend with one of our ETFs.

The market now will have to digest more economic news with Durable Goods and GDP coming Wednesday and Thursday. Friday we’ll likely see the US go over the Sequester hurdle. We’ll be focused on the overall market action. At the moment we are seeing a lot of distribution in the market without much accumulation. Looking back to September of last year we didn’t see this level of distribution like we are seeing now. Perhaps there is something more sinister happening, but we’ll wait for our signals before we act. We are still a bit oversold in the near-term so another bounce from the market is not out of the question. Stay ready and execute your game plan.

We do have few pockets of strength, but it is so few and far between it is nothing to get excited about. FLT continues to be a big winner, but many leading stocks look bad. BAC has been a leading stock despite its pitiful earnings growth. Remember, BAC has been goosing its earnings using its loan loss reserves. GS remains above its 50 day, but the last few selling days have left a big blemish. Homebuilders certainly got some love today, but remain below a key moving average. These stocks will need to rebound to give this market any chance of rebounding.

Stick to your signals and ignore the nonsense spewing from CNBC.

Short-term trends:

TICKER ST TREND TREND CHANGE DATE CLOSE %
SPY UPTREND NO CHANGE 2/26/2013 150.02 0.68%
IWM UPTREND NO CHANGE 2/26/2013 89.37 0.39%
QQQ DOWNTREND CHANGE 2/26/2013 66.56 0.38%
USO DOWNTREND NO CHANGE 2/26/2013 33.33 0.36%
UNG DOWNTREND NO CHANGE 2/26/2013 18.98 -0.52%
GLD DOWNTREND NO CHANGE 2/26/2013 156.22 1.22%
SLV DOWNTREND NO CHANGE 2/26/2013 28.41 1.21%
DBC DOWNTREND NO CHANGE 2/26/2013 27.42 -0.18%
FXY UPTREND CHANGE 2/26/2013 106.55 -0.75%
FXE DOWNTREND NO CHANGE 2/26/2013 129.57 0.02%
TLT UPTREND NO CHANGE 2/26/2013 119.33 -0.58%

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