This is the week when Fiscal Cliff has to come to a head, adding to the mix we have quad witching on Friday.
Impact of these two event either will increase volatility or may give us a pleasant surprise.
Fiscal Cliff is entering a decisive week, both democrats & republicans have done enough posturing for weeks, now it is time to deal with decision making.
Quadruple witching on Friday can create volatility on Thursday.
Looking @ S&P 500 which has lost 1.86% in last two trading days, is looking vulnerable based on above two issues.
IF indices gets jittery we may test support near 200 DMA in S&P 500 which is @ 1387.49
BUT IF IF we get some sense of resolution about Fiscal Cliff then we can jump towards September highs of 1474.51
As many of you have noted that many laggards are in a "major bull run"...these stocks are defying TAPE for few months now..be it YHOO,JCP,APKT,RIMM they are showing major moves....
SO..it is not important to be FIXATED on obvious issues which will be resolved one way or the other, but to stay close to "positive TAPE action"...........
Many all knowing pundits are "grudgingly acknowledging major moves in stocks they ignored or said NOT to buy".
This market character has changed, small to medium caps stocks are getting allocation by many institutions.It is important to notice where "money flow" is going.
Indices may be under pressure, but many stocks are continuing their march to higher highs.
Good luck with your strategy.
BLOG does NOT give buy or sell.
Saleem
8 comments:
Hey Saleem,
I hope the political drama takes a backseat to legitimate offers and compromises now. It would be a nice Christmas present for many.
Stocktrader
Hi Stocktrader,
There is a famous song by Ringo Starr.....IT DON'T COME EASY......which describes Fiscal Cliff negotiation....hopefully "this week"
Saleem
Saleem
BAC is breaking out from 10 week ago and it still want higher. I think all financial stock will be great. At least till the end of year
Hi Up,
All financials have major move ahead as they are all financially sound with strong balance sheet......
Saleem
Hey Up,
I bought some BAC Dec 11 calls for $0.04 in a trading account on Friday. Looking lovely today :).
Stocktrader
Stocktrader
Nice trade. I am having a very good month. Lately I spot very good trades. ISRG and CLF is my latest darling. And I am still riding GS where I got it at 116. I expected AIG will be my next big winner. Fingers cross
Saleem
I am keeping a close eye on FB, After this pull back. This could be a big winner for next year. Maybe it could hit 30 before year end
Hi Up,
YES...FB has the potential to go well above IPO price.......due to their "mobile ad strategy"
Saleem
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