Market hangs in there..
Wednesday, March 3, 2010 at 07:52AM Some thoughts did occur to us that we'll give the recent high a try soon as the market continued it’s steady grind today, but when the clock struck 2pm, reality sank in as it topped out for the time being at 1123SPX. The culprit for the late downdraft was likely MSFT's day, which coupled with a recent extended SMH/ SOX led the slide. Having a neutral stance on SPX levels, we feel, it's probably better for this market to take a breather before giving a serious attempt at new highs. In other words, a mini pullback at this level will be considered healthy. At this point, many plays on our list are looking extended and it's not very wise to chase at the current price level. Instead, we are looking for new stocks coming up to potential breakouts out there to trade.
Of course, we have to respect and obey the force of this market in case it gets happy feet over a Greece resolution, NFP # report and climbs higher. Or/ An important ingredient this week not factored in before has been the ‘ positives’ in M&A activity (today TRA) and the many buybacks, including one that helped an alert play today in PLT. Just like investors on the sidelines with not many places to put cash except into riskier assets like equities to get a decent return, companies with mountains of cash are showing the same temptation this week. If this continues at this pace, it could be an important catalyst coming to fruition to move this market higher.
We basically have a few days for this market to pause / consolidate before the NFP# . We also have China`s National People`s Congress starting March 5th to be a possible market mover ahead. Add the anticipated Greek resolution for this weekend and it’s best the markets don't get ahead of itself and than have any of these market mover possibilities cause the phenomenon of sell on the news.
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