You just can't help feeling that one of these days, this market will try for the SPX November low and test it. As far as today, it was a pretty good yawn fest with few trading opportunities. A lot of headlines, but nothing ground breaking within them to move the market in either direction. It's probably expected after Tuesday's dramatic sell off. Having a strong follow through to yesterday's heavy loss and a test of Nov. low in two days time is just simply too overwhelming and stressful to even think about for most traders, so we had nothing but a tepid trading day. So, which do we rather see first, a quick move back over SPX 800 or a test of Nov. low around SPX 750? Honestly, moving the market up in current environment is probably unhealthy at best. A few of the biggest items that have carried over to this Q are still to be resolved. We are likely going to have those (Citi, GM) as market catalysts to mark a bottom, as far as this crisis is concerned sooner than later.
Up until recently, technology seemed to be one sector holding up. AMC, we had HPQ report a big revenue miss, but EPS held up quite well and this might be just enough for some life in the sector. The report does show a sharp deterioration (over 20%) in BRIC countires. To us, techs are all about GOOG, AAPL and maybe RIMM. If you can get a handle trading those, it's irrelevant to even track COMP or Qs.
Commodities took a licking yesterday along with everything else, but today's market painted a different picture amongst the various sectors. Due to the MS ag. conference, most of the ag plays fared very well. The weakest spot lies in the natural gas and steel sector and everything else is slotted in between. We are eyeing a few things here, but given the current downward market bias, we won't be in a hurry to establish a full position any time soon. The $CRX hit January lows and made a slight reversal today, we'll look for some follow through before getting into individual equities. A weaker $USD and a stronger Oil seem like a fairy tale these days to get anything moving.
This is a short week, but it already feels like a super long week. We have option expiration to deal with on Friday and it'll be interesting to see where traders want to pin this market. Lastly, we had PCLN , an old favourite here, post some decent numbers and slightly upbeat guidance. This one tends to be volatile and AMC action is already pushing it to the best level in few months. It has huge short interest on it and it may be a candidate for some trading opportunities(dip) tomorrow, if market pulls another dull day. Other than that, we just wait on some Eco data in the morning along with potential TALF news to possibly give some market direction.