Futures Pare Massive Overnight Losses, But Still Set for Sharply Lower Open

The bad news keeps rolling in as the stronger European players are starting to weaken. A poor auction is showing the German bond losing appeal as well. There are more concerns that we will wake up to France losing its triple AAA rating. Spain actually sold 3-month bills at 5.11%, more than twice the yield it paid last month, and well above the 4.63% that Greece paid on Nov 15th. The problems in Europe are intensifying with no quick fix or proper solutions. The Dexia situation and the Chinese flash PMI are also factors driving the risk-off trade.

Yesterday the IMF came out midday and stated they would help and the rally lasted about an hour. These are very dangerous times as technically the market went back into correction November 16th when the wedge pattern resolved to the downside.

The S&P futures were down 16 handles about an hour ago and are only down 9 points. Traders who are working today will try to figure out if we can make some cash flow. Will the powers that be try and close today in the green? Nobody wants a negative spin on the economy heading into the holiday season, which is crucial for retail.

We are opening below the two day pivot that was created in the 1183 area, so the new micro spot to watch is 1166-1175. Under that we have 1158.


I would look to anything that was strong yesterday and see if you can make small money if they can go negative to positive.

Apple (AAPL) was a nice focus for us yesterday as it bounced around the 200-day moving average. On my price point sheet $371.68 triggered for my community and it was one of the few trades that worked. I will focus here today see if it can go positive and trade through yesterday’s highs. The stock has some room to the $380-$383 area.. Longer-term it still has a lot to prove.

Amazon.com (AMZN) also closed pretty strong. If I see some relative strength I will play for a negative to positive move and then an additional buy through $194 for a bit more upside to close the gap.

Other tech stocks showing very recent relative strength that I will watch include Qualcomm (QCOM), Sandisk (SNDK), VMWare (VMW), IBM and Intel (INTC).

At this point most traders are flat or very light as momentum has left this market and the upcoming holiday will probably lead to paltry volime. The trend broke 5 sessions ago and now it’s time to just pick and choose small spots and keep risk low. There are fewer and fewer players right now. The ones that beat the benchmarks can take a long Turkey Weekend and maybe go away through year-end. Those who were on edge to chase performance were let off the hook.

So there is not much interest here as we keep getting disappointed by those suppose to lead this nation and world. You can’t control the headlines, just your actions. Take accountability and trade and live within your means.

Enjoy your family for Thanksgiving. This is a great holiday to have fun and appreciate what you have.

Disclosures: Scott J. Redler is long SPY

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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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