Watched Pot

As many people have pointed out in the comments section, it's been a very long time since we've had any kind of sustained downturn. And at this point, "sustained" means more than one trading session! The market is firmly up the 12,000 mark and seems to have its hands perched haughtily on its hips, daring anyone to sell.

It's easy to forget just how complacent and calm this market is. Just look at the NASDAQ recently compared to the wild days of 1997-2002. The market exploded higher over a three year period (and unwound the entire gain just as quickly). Yet over the most recent three years, we've been calmly and carefully moving higher at a deliberate (and annoying) pace.


The Russell 2000, which I'm a bit obsessed with, is in a no man's land at this point. If it breaks below the rectangle I've drawn, odds are very strong that we've seen the top put in. If it breaks above it, we could be in for more of the same bullish behavior. The calendar is not working in our favor. November, December, January are not known as bearish months. But I'm shurring off seasonality at this point, given how useless it was in September and October.


The $SPX, shown below on a minute bar basis, has lost its steam. It was on a solid tear (see the up arrow) for weeks on end. Recently, although it hasn't plunged by any means, it's definitely a bit pooped. Tomorrow morning's retail report and CPI figures (both of which come out an hour before the opening bell) will almost certainly provide some short-term direction.


The gold and silver index, which I am short, fell nicely at the opening bell this morning, but it recovered for most of the day. I've got a stop in here at 142.60.


I'll probably have more to say tomorrow, after the latest economic figures come out.