Disappointing durable goods orders could not keep the market down as rising crude prices and FB pushed the market higher. First, FB reaction to earnings certainly boosted the market as the company destroyed expectations. Crude helped futures gallop higher after a headline stated there was a potential production cut by Saudi Arabia. While the headline was not new the Saudis did come out and deny any deal to cut production by 5% was false. Crude was still able to close higher on the session. This market continues to tread water and cash remains king.
Volume was higher on the session, but we can thank FB for providing the volume. Yesterday’s massive selling was quite telling this market is not ready for prime time. It really does not come as a surprise to us mainly because there is a lack of solid leadership from this market. Besides, earnings continue to be a crap shoot. AMZN reported after the bell and it is currently being crushed. MSFT reported earnings and it is moving higher during the after-hours session. There is no rhyme or reason to these moves here and without cushion in the stock holding through earnings is a difficult thing to do.
Sentiment eased off the lows for Bulls with the AAII survey showing bulls nearing 30% once again. Bears slipped just below 40%. Given how few bulls there were it is somewhat disappointing the move off the 1/20 lows has been. Perhaps in a week we will see the NASDAQ up more and the move will be more satisfying. Until then, we have a market treading water with very little peaking our interest.
The best move here is to sit and be picky with trades. The best poker players in the world know when and where to be aggressive with their chips. Trading is not much different. There are times when you sit in cash and others you push all in. While there are trades to be had here and there the abundance of quality opportunities is simply not there right now. Allowing for the proper risk/reward set up is essential. Do you want to win? Join our winning team and use coupon code CRASH and take 30% off our subscription prices. Hurry, deal ends Friday January 29th! Go here to register.
Tomorrow is the last trading day of the month and many bulls cannot wait for this month to close. Odds are we will see this year end in the red. History tells us as January goes so does the market. So far, the S&P 500 is down 7.37% for the month. Do not be discouraged we always find opportunity to grow our accounts.
Enjoy the weekend!
