Futures Down Sharply as Market Has Commitment Issues

There are some red arrows around the world as this time Europe leads us lower. The Nikkei also lost the 15,000 mark with a 0.6% loss on the day.

S&P futures are down 14-16 handles and many are looking for reasons why? Some blame it on the continued emerging market and currency issues. Amazon (AMZN) has been volatile since reporting disappointing earnings last night, and after bouncing off post-market lows last night is back down almost 8%. Besides that, most of the notable earnings last night were pretty positive with Google (GOOG) up 4% after only a decent report, Chipotle (CMG) up nearly 12%, and Zynga (ZNGA) up 20%.

This has been a tough tape as each day has been different with no real consistent tone. During periods like this you have to fight the urge to want to be aggressive and learn to sit on your hands and do less. The futures each day feel random and erratic.

What we do know is that the accelerated trend broke at S&P 1812-1830 and the market that looked like it could try to build a “right shoulder” hasn’t had the power to do so. The lack of a sustained bounce has made those looking for cute bounces feel a bit frustrated. The Bears will now have their chance to break the 2014 pivot support and the intermediate trend around 1766-1772. If you are trading vs that spot, as painful as it is, make sure to honor it. A close below then could lead to the 200-day beneath at 1705ish.

There are some individual names that do act better but that’s hard to find and stay with work this increased volatility.

You will hear all about what a weak January means for the year ahead. I will take it as it comes and measure each area, rather than make predictions. If you are comfortable and not in harm’s way you can embrace the volatility and trade it, rather than just being caught in it.

In perspective, market just took back what it gained since last December not even two months ago. I will try to salvage the morning as it could be a tough one.

Disclosure: Scott Redler is long SPY, GS, YHOO, TSLA, QIHU.

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About Scott Redler 367 Articles

Scott Redler is the Chief Strategic Officer of T3 Live. He develops all trading strategies for the service and acts as the face of T3 Live. Mr. Redler focuses on thorough preparation and discipline as a trader.

Mr. Redler has been trading equities for more than 10 years and has more recently received widespread recognition from the financial community for his insightful, pragmatic approach. He began his career as a broker and venture capitalist where he was able to facilitate relationships that led him into trading. Beginning his trading career at Broadway Trading in 1999, Mr. Redler moved on with Marc Sperling to Sperling Enterprises, LLC after establishing himself as one of the best young traders in the firm. As a manager at Sperling Enterprises, continued to trade actively while working closely with all traders in the firm to dramatically increase performance.

Mr. Redler has participated in more than 30 triathlons and one IronMan, exhibiting a work ethic that also defines his trading. His vast knowledge and meticulous attention to detail has led to regular appearances on CNBC, Fox Business, Bloomberg, and he is a regular contributor to Minyanville and Forbes’ Intelligent Investing blog. He has been quoted in the Wall Street Journal and Investor's Business Daily, among other publications.

Scott received a B.B.A. in Marketing/Finance from the State University of New York at Albany, graduating Magna Cum Laude from Albany's School of Business.

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