What's to like?

..Nothing really!   What's not to like?....   Just about everything after the wide commodity sell-off ($CRX -4.3%).  Once July's lows support around 850 was broken it was an easy slide to 823.  The $CRX break preceded the big oil late morning plunge. 

Sometimes we just don't want to be this gloomy on the market.    There's always seemed to be some kind of silver lining that's keeping us the traders come in every morning to do our work.     Occasionally, and really very seldom, we have this kind of market where nothing seems to work.     Trading strategies, none that we know, can apply to this particular kind of market.    Basically, when we as traders run out of trading ideas, we simply just sit and watch.    The worst thing that can happen to a seasoned trader, is to become creative and experimenting new things when the trading environment is downright hopeless.

Okay, maybe we've been a little tilted toward commodity plays in the last little while.    However, now that the commodity groups are in the apparent down spiral action, it still doesn't give us any comfort to step into any other group.  Something had to give this week and unfortunately, the only group that had the earning potential to lead, crumbled!.  The word today was liquidation by a large commodity hedgie, add the sudden dip in oil and we had a waterfall.   Ironically, this happened on the 2nd trading of the month, just like in the July burst.    Commodity groups are down recently due to the overheated action since the beginning of this year.  The earnings have just been a reason to sell off.   While this is tottaly understandable, we still have to remain vigilant in tracking this group for near term potential.     Volatility is at an extreme level with the commodity group as momentum money leaves, so we'd either play extremely small or not play the group at all.    As we have been saying in the past few journals, forget about building any positions in any stocks right now.  It's useless.    The trading theme these days is nothing but a few chase of top gainers here and there.    Earnings play in the broader market, up to this point are a huge disappointment.  The fact the broad market had a steep decline today while Oil plunged is not very comforting because we've always rallied as this occurs.  Tuesday we have FOMC decision/statement and CSCO's earnings to potentially lead us back to July's lows.

Who do you put the blame on?   The hedgies?  The speculators?    We think this is what it is.    We are currently in a tough economic and trading environment and we just started the toughest trading month of the year.     When you pile all of the recent events together, there's really nothing anyone should look forward to the next three to four weeks out.      Right now, as a trader, less is better.     The less trading you do, the more likelihood that you are going to outperform.     Is this going to be a trend forever?   Fortunately no!    

For now, just relax and be entertained by this market.    This is the time every trader should know his/her limits and be honest with themselves.