Here is where it gets interesting. The market has pulled back over the past two days. Looking at the DJIA, it seems pretty restrained. Volume was just at, or slightly above, average. The Dow pulled back to recent support, tested it, but closed at the halfway point of the day’s range:
Moving over to the NASDAQ we see a less encouraging story. A 1.5% drop on Wednesday, a gap-down opening yesterday, and 10 down-closes on above-average volume in the past 20 days compared to 8 up-closes on above-average volume. The ‘Naz’ looks ready to test not only the 50-day moving average, but start filling that large gap following the fiscal-cliff partial-solution at the beginning of the year.
Looking at individual stocks, a good many of them appear to be selling off:
Others, like Amazon, yawned and asked “what’s the big deal?”
And then there are stocks like Roper that figured yesterday was as good as any to continue its steady upward ‘stair-stepping’:
I first focused on Roper in the September 19th Seasonal Forecaster newsletter when it was at 106.29, again in the October 1st issue when it was at 109.89, and the January 14th issue when it was at 114.38.
The NASDAQ is down 1.5% since September 19th, and ROP is up 15%, showing there are always good trading opportunities even in uncertain markets.
Keep in mind that sequestration is likely to go into effect at this point. The market could react sharply. I would expect it to settle down quickly after that and resume normal business, but watch current positions closely, take profits while you can, and initiate only smaller trades in the near future, if at all, until this gets sorted out.
Of course, there's much more you need to know and many more stocks you can capitalize upon each and every day. To find out more, type in www.markettamer.com/seasonal-forecaster
By Gregg Harris, Market Tamer Chief Technical Strategist
Copyright (C) 2013 Stock & Options Training LLC
Unless indicated otherwise, at the time of this writing, the author has no positions in any of the above-mentioned securities.
Gregg Harris is the Chief Technical Strategist at MarketTamer.com with extensive experience in the financial sector.
Gregg started out as an Engineer and brings a rigorous thinking to his financial research. Gregg's passion for finance resulted in the creation of a real-time quote system and his work has been featured nationally in publications, such as the Investment Guide magazine.
As an avid researcher, Gregg concentrates on leveraging what institutional and big money players are doing to move the market and create seasonal trend patterns. Using custom research tools, Gregg identifies stocks that are optimal for stock and options traders to exploit these trends and find the tailwinds that can propel stocks to levels that are hidden to the average trader.
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