Market Outlook for next 3 plus weeks
Well the week was a calm one with the range on all 3 indexes much tighter than in previous weeks and months. It got everyone settled down but it was difficult to make any money in the market with such a tight range. We have not been able to get above the 60 day Moving averages. We have settled in between the 40 Day and 60 day Moving averages. With the coming slow 2 weeks of the holidays, I don't see much going on except tax loss selling by individuals. Then in the first and second week in January I see a pullback in all three of the Indexes.
The main indicator for what was happening this week was the Volatility Index, symbol VIX. It went down to close at 44.93 for the week. It opened the week at about 56 and closing at about 45 results in a 20% reduction in Volatility. We are not yet back to the August lows of 20 but the trend continues down. As the Volatility Index drops, it is more difficult to make any money on Index trading of the Dow, Nasdaq or S&P 500. So that is why for the week the ETF's didn't gain much nor lose much. I am hoping for a breakout the first 2 weeks in January. That will be the time to cash in to the upside should that be the direction or to the downside, which I see more likely.
Several stocks I watched this week were these. Ford for example has not returned to where I sold it, $3.26. The bailout created some buzz at the opening but then fizzled as I had predicted. I also own a stock called Beacon Power, symbol BCON. It has been shorted since July and that has driven the price down significantly. But there was life returning to the stock this past week on increased volume, a good sign. I look in the coming month for a retest of the lows in MGM timed with the market drop. I have heard the impact continues on the Stip in Vegas so I think they will have a disappointing holiday season.
Unemployment is rising with no relief in sight going forward. This is going to have a continued negative effect on the psyche of everyone. Just yesterday while Christmas shopping I overheard people talking about the poor state of the economy, their jobs and concerns they would get let go by their employers but were going to buy a few small presents for their kids anyway. I have never heard anything like this before during Christmas shopping. I heard similar conversations in 2 separate stores. That stinks. Let's at least try to be more positive out there folks!
Merry Christmas, Happy Hanukkah and Happy New Year.
The main indicator for what was happening this week was the Volatility Index, symbol VIX. It went down to close at 44.93 for the week. It opened the week at about 56 and closing at about 45 results in a 20% reduction in Volatility. We are not yet back to the August lows of 20 but the trend continues down. As the Volatility Index drops, it is more difficult to make any money on Index trading of the Dow, Nasdaq or S&P 500. So that is why for the week the ETF's didn't gain much nor lose much. I am hoping for a breakout the first 2 weeks in January. That will be the time to cash in to the upside should that be the direction or to the downside, which I see more likely.
Several stocks I watched this week were these. Ford for example has not returned to where I sold it, $3.26. The bailout created some buzz at the opening but then fizzled as I had predicted. I also own a stock called Beacon Power, symbol BCON. It has been shorted since July and that has driven the price down significantly. But there was life returning to the stock this past week on increased volume, a good sign. I look in the coming month for a retest of the lows in MGM timed with the market drop. I have heard the impact continues on the Stip in Vegas so I think they will have a disappointing holiday season.
Unemployment is rising with no relief in sight going forward. This is going to have a continued negative effect on the psyche of everyone. Just yesterday while Christmas shopping I overheard people talking about the poor state of the economy, their jobs and concerns they would get let go by their employers but were going to buy a few small presents for their kids anyway. I have never heard anything like this before during Christmas shopping. I heard similar conversations in 2 separate stores. That stinks. Let's at least try to be more positive out there folks!
Merry Christmas, Happy Hanukkah and Happy New Year.
Labels: Beacon Power, Dow, ETF's, Ford Motor, market outlook, Moving Averages, Nasdaq, SP500, VIX Index, Volatility Index
posted by Charles Amico at 6:13 AM
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