The market has been quiet Monday after opening slightly higher as the tug of war between the bulls and bears continues. Volume has been light with no economic data or news coming through today, but that could change with the start of another important earnings season after the close with Alcoa Inc. (AA). Until the market is able to gain some traction either long or short, it is prudent for traders to stay light and nimble.
After another up open to all-time highs, iShares Silver Trust ETF (SLV) is trading sideways, while the SPDR Gold Trust ETF (GLD) is doing the same after a slight down open. The fact that silver has held up so well is a bullish sign for the precious metal as investors are not yet eager to take profits.
Apple Inc. (AAPL) is once again weighing on the indices, unable to shake off concerns over Steve Jobs and finding life after index weight rebalancing difficult. The stock remains below its moving averages and has traded down into minor support at $330. The final area of support before the real danger zone for Apple is $326.26, the low from the March 16 mini-debacle. Then next area of significant support would be down around $320.
Baidu.com, Inc. (BIDU) sold off in the first hour after a monster gap up, but pared some of those intraday losses. However, the stock has turned back down once again as we head into midday. The announcement of a deal with Facebook for a social networking service in China has investors salivating, but some appear more cautiously optimistic with the valuation of BIDU already very high.
The fertilizers are reversing off moving averages and could be candidates for a bounce if the market can catch a bid. Group leader PotashCorp./Saskatchewan (POT) bounced off its 21-day MA and is currently pushing through Friday’s low for an 80-20 reversal set-up. The group has been recently prone to exaggerated sell-offs, but has rebounded well each time. Others in the group include The Mosaic Company (MOS), Agrium Inc. (AGU), and CF Industries Holdings, Inc. (CF).
Overall the market still feels a bit heavy after Friday’s break below the ascending channel. Among stocks that look like shorts at this stage are United States Steel Corporation (X) which is currently dipping below major support and testing lows for the year. Again, less is more at this point as investors gear up for another crucial earnings season.
*DISCLOSURE: Scott Redler is long POT, GLD, JPM, BAC, AUY, RBY. Short AAPL, SLV.
This material is being provided to you for educational purposes only. No information presented constitutes a recommendation by T3 LIVE or its affiliates to buy, sell or hold any security, financial product or instrument discussed therein or to engage in any specific investment strategy. The content neither is, nor should be construed as, an offer, or a solicitation of an offer, to buy, sell, or hold any securities. You are fully responsible for any investment decisions you make. Such decisions should be based solely on your evaluation of your financial circumstances, investment objectives, risk tolerance and liquidity needs. Visit the T3Live Homepage, Virtual Trading Floor, and Learn More About Us.
