A double dose of bond buying today from the Federal Reserve totaling roughly $5 billion wasn’t enough to keep stocks at their highs of the day. It appeared for much of the session sellers would have an upper hand in the battle all day long. Today’s double POMO was the second of three this month due to the shortened holiday month. The market was able to close in positive territory, but the Russell 2000 was not as fortunate as it lost .17% on the day. After Friday’s roller coaster ride it appears we remain in a holding pattern waiting for a catalyst to move us into new highs or challenging the most recent lows. The day could have turned out much worse than it did and even though there were some cracks showing up in the market we’ll stick with this uptrend.
A nice showing by social media stocks today as TWTR followed through with some volume and sits just below the high of the day it first traded. FB continues to base build here in quiet volume. The $50 market appears to be its resistance point at the moment. Another social media stock turning things around is LNKD. LNKD is poised to continue its run from its November lows after moving sideways since September. This market appears to be in constant rotation and you must be on top of your game to find opportunities you would otherwise miss by not paying attention.
Volume today rose on the NYSE and fell on the NASDAQ. It certainly felt like the market was very slow and it was strange volume on Friday was so light given we received the jobs data. There isn’t any sense in trying to understand why volume is the way it is. Institutions weren’t active on Friday and were more so today on the NYSE. It does give the feel of churning when volume rises while price stays stagnant. It is certainly something to keep an eye on as we progress forward. At this point it isn’t a major red flag to us. We have seen volume not matter for some time, but it will be when we aren’t looking it WILL matter.
There are only a few weeks left for this market to stage a rally. Santa needs to be credited with another rally! Stick the plan and stick with riding your winners and cutting your losers.
