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Apr 20

The Market Today

4/20/2012

The market started the day strong, and moved lower going into the close. Earning have been the primary driver. Mostly Microsoft and General Electric helped power the market higher. Of all stocks, Apple and Priceline, have been the primary drivers back down. When the overwhelming leaders of the market move in concert, and as aggressively, to the downside, this is a negative sign to the market. When the leaders turn to laggards, it is only a matter of time till the market follows. The S&P looks as if a big impending move is about to occur. The only question, is what direction? Based on what I see, I am expecting this move to be to the downside. Only time will tell. We are still in the midst of earnings season. Of course, we are on the cusp of turning the calendar to the month of May, and you typically sell in May, and go away. Based on the trading patterns for the last three years especially, I cannot see a reason why this year will be any different. When you look at the yields on the 10 year US treasury once again closed below 2%. As I have mentioned on my posts, I am negative towards the market. I do not see any compelling reason for the advance to continue, without as much as a pause. In order for a long term advance to continue, you need to see periods of weakness to have a long term healthy advance. When you couple the ways the markets look here, the events in Europe, I continue to feel the risk is greater than the reward. Until much changes, that is my stand. Use any periods of strength to take profits. Enjoy the weekend everyone!

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