Good morning everyone

I’m sorry that there was no Morning Video yesterday and that I had to cancel the RWO room.  Trust me I did everything I could to get back online as soon as possible but when the city decides to dig right through a major internet trunk line there is only so much that can be done.

Sadly yesterday did nothing but continue to confirm that the current downtrend is still valid.   This morning we are seeing that bearishness gap the market lower for yet another test of support.  Let’s hope it holds because it doesn’t we could see some very rapid selling as stop loss orders begin to trip.

Thus far earnings have done nothing to break us out of this downtrend, however, with more than 200 companies reporting today and 450 tomorrow anything is possible.  Please make sure you are checking when a company reports before jumping into anything.

We have some big new items this morning that could move the market but I think the one to keep any eye on is the report on oil.  A surprise build in surplus would likely send oil lower and pull the overall market down as well.

I know I sound like a broken record but please use caution when trading.  A very big price move is possible at any time and you don’t want to be caught on the wrong side of it.

Trade Wisely,

Doug

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Good morning everyone

It’s a beautiful Monday morning the futures are suggesting a 70 plus point gap up the open.  The huge merger deal between At&T and Time Warner is the reason for the excitement this morning but hey I welcome anything that might break us out of this chop.

This week we really blast into earnings with nearly 500 reporting on Thursday alone.  Let’s hope they are better then what we have seen so far this quarter which has been lackluster at best.

There are 4 Fed speakers flapping their lips today which could mean some market nervousness if they lean hawkish.  Another concern is that oil futures are currently down slightly and may dampen the bullish morning pop.

Although I am encouraged in the positive open we much keep in mind that the current downtrend must be defeated as well as the upper resistance level before gaining confidence in a direction.  There is still a lot of work to be done.

Trade Wisely,

Doug

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Good morning everyone

Happy Friday everyone!  This morning the market has a bit bearishness as the majority of the earnings seem to be failing to impress investors.  Both Asian and Euro markets were mixed overnight with a slightly bearish lean.

Overall our major indexes remain in a very tight range with sideways chop maintaining control.  If you are struggling in this market you are not alone.  Data showed that last quarter the hedge fund industry performed less than the S&P average due to this challenging environment.  28 billion flowed out of hedge funds last quarter which registering as the biggest number since the 2009 selloff.  Significant outflows continued in the mutual funds as well last quarter.  Obviously, this isn’t  a big confidence builder in the overall market however we need to see better price action before making any major moves.

There are a couple Fed speakers today but no major economic reports.  Keep in mind there will be a major jump in earnings reports next week.  Perhaps we may get some better clues next week but for now, I want to remain very cautious and small as we head into the weekend.

Have an awesome weekend everyone.

Trade Wisely,

Doug

Click Here to Watch the Morning Video

Good morning everyone

Yesterday it was nice to see a little bullishness in the market but overall we continue to remain trapped in a very small range.  Earnings this far have really not inspired the bulls or the bears into taking a lead.

A very big move in either direction remains a possibility so if you do decide to trade make sure you have some balance in your portfolio with long and short positions.

Trade Wisely,

Doug

Click Here to Watch the Morning Video

Good morning everyone

Do my eyes deceive me?  A market open without a major gap.  A rare occurrence of late to be sure!  As nice as that is to see the fact is the market continues to be down-trending and locked into a very small chop zone.

I plan to remain cautious largely sitting on my hands patiently waiting a market direction to appear.  I certainly understand how frustrating this can be however it’s far better than bleeding capital daily in this chop.

The earnings reports are picking up so I highly suggest making sure you know when companies you hold are reporting as well as checking those you are thinking of entering.  Failing to do so can inflict pain you really don’t want to experience.

Trade Wisely,

Doug

Click Here to Watch the Morning Video

Good morning everyone

The market is very happy this morning with the big earnings beat from NFLX.  The market was expecting less than a $10 move but the stock is gaping nearly $20 higher this morning.  At 8:30 we have a potentially market moving CPI reading.  There are a couple other reports that can move the market but it’s unlikely that they will.

Just because the market is gapping up does not mean we should get all excited and chase this gap.  Even with the opening pop, it should be noted that nothing has really changed as of now.  The market is still in a downtrend and we continue to be stuck in a very narrow range.  How many times have we seen in the last month a gap up that has been sold into over the next couple days?  Fool me once shame on you, fool me twice shame on me.

There is absolutely no need to rush.  Keep your emotions in check by planning your trades carefully and waiting for the trade entry to come to you.

Trade Wisely,

Doug

Click Here to Watch the Morning Video

Good morning everyone

As I write this the Dow futures are pointing toward a negative open but some big profile earnings reports prior to the open, a couple big economic reports after the open and Fed speak, how we close the day is anyone’s guess.  What we do know as fact is that Friday left us with a bearish candle on the DIA and the SPY once again reacting negatively to the upper boundary of the downtrend.  On the other hand, we are also near the support that has kept us locked into a very narrow range of chop.

Being bullish or bearish at the moment would be nothing more that guess reflecting your personal bias.  Be careful because anything is possible with the potential for very large moves in price.

Personally, I want to stay very small and limit my trading until this chop has resolved into an uptrend or downtrend.  I really don’t care which direction.

Keep in mind after the close we kick earnings of the big tech’s with IBM and NFLX.

Trade Wisely,

Doug

Click Here to Watch the Morning Video

Good morning everyone

It’s Friday!  This has been a very tough week, and I for one will be very happy to have it fade into memory.  Today we have have had some big banks reporting earnings.  The reports were positive and so we gap once again in the pre-market.  Yesterday’s open to today’s open is nearly 200 Dow points apart.  Feeling chopped up?  You’re not alone.

We have 3 Fed speakers today which could easily reverse the happy sentiment we see in the futures this morning.  We also have several economic reports that could move the market around this Friday. Be careful!

The RWO E-Learning normally the 3rd Saturday will be postponed until next Saturday due to my father-in-law’s funeral.  Also, I will be conducting the RWO room today in room 1.  The password will be removed so everyone can attend.

From lunchtime on I will be hit and miss today with lots of folk coming in for the funeral.  If you send me an email or PM’s there is a very good chance I won’t be able to get to them.

I wish you all a fantastic weekend.

Trade Wisely,

Doug

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Good morning everyone

The good news is we no longer have to worry whether or not the support will be tested.  That has clearly been answered and we have to move on the next question.  Will support hold?  I suspect with some of the big banks reporting on Friday and early next week that hope of positive numbers will prevent the big guys from getting full-on bearish just yet.  That, however, doesn’t mean that we could see a quick move below support simply to sweep out stops so don’t rush in if we see a little bullish push right at the open.

If you are a long-only trader let me suggest taking the rest of the week off.  Wait to see if earnings can, in fact, break the downtrend.  Until that occurs the bears are in control and they love to steal the lunch money of traders high on hopium predicting a bottom has been made.  You risk almost nothing by waiting for proof except maybe bragging rights if you do happen to get lucky and pick the bottom.  If you are that kind of trader it’s better to go to Vegas because there will at least bring you free drinks to dull the pain of watching your money disappear.  That may sound a bit harsh but it’s the truth.  You can thank me later.

Trade Wisely,

Doug

Click Here to Watch the Morning VideoP

Good morning everyone

First I would like to say thank you to everyone for all the kind words, prayers and well wishes that I have received on the passing of my father-in-law.  The members of this room are the best and over and over proves itself as more than a trading room but an extending family.  My wife Connie and I are very thankful to be a part.

Today we had a couple fed members speaking and at 2 PM eastern we will get the minutes of their last meeting.  It’s possible we could see volumes diminish after the morning rush while we wait.  Personally, I would be surprised if we find out anything we don’t already know but anything is possible.

Yesterday turned in a bearish evening star pattern right at the 50 SMA on both the DIA and the SPY.  Lately, we have seen big moves down rejected by big reversals the following morning.  Unfortunately, we are not seeing that this morning as the futures remains flat to slightly bearish.  To me, this would suggest more downside moves are likely within the next couple days.  The big question if that occurs will be if the price support is strong enough to hold.  I think we will soon find out.

With several of the big banks reporting Friday morning, a reversal, if there is one, would logically come at that time.  That being said, we also have to acknowledge that logic is not one of the markets strong points.

Trade Wisely,

Doug

Click Here to Watch the Morning Video