A Few Thoughts Before the Open:
In looking at the charts from yesterday’s trading activity it is clear that the vast majority of the sector indices and individual stocks have negative chart pattern. However, the negative open yesterday followed by the intra-day rally more or less made it very difficult to find any trading ideas for the day. Combine that with the positive futures at the time of the writing of this post and I am going to sit the day out. My thoughts are that we need 1 or 2 more trading days to shake things out for the post-Labor Day market.
Additionally I am having a hard time to find anything to be positive about this morning. The European crisis has not been resolved, and it has not been resolved. In looking at the news posts on the Sterling Reporter it is clear that the voters in Europe are not happy with the politicians solutions to the crisis. The voters in Germany don’t like the idea of paying for it, and the voters in Italy and Greece don’t like the belt-tightening that comes with it. Basically no one is happy, and there is a risk that the politicians in all the crucial countries could be voted out of office. Not a good scenario. Until this is resolved, and it is going to take some time and my expectations are that we are going to see a fair number of politicians voted out of office, then I see the market continuing to be under pressure.
Additionally we have our own politicians showing back up in Washington D.C. today, and President Obama addressing the nation tomorrow night. Until I am proven wrong, I am expecting the campaign rhetoric to start asap and have a negative impact on the market.