Tiresome, Tedious Action

 | Nov 15, 2012 | 4:27 PM EST  | Comments
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I've often written that the reason to respect momentum is that the market tends to move in one direction much longer than most people think is reasonable. That certainly is well illustrated in this market, which has suffered yet another poor day.

Not only has the market been steadily sinking for weeks, but it has consistently closed poorly. The last close near the highs was 11 sessions ago and, prior to today, there were six straight closes in the bottom of the intraday range.

The market finally managed a little better action into the close today, and that makes me a little more optimistic that we may finally see a better bounce soon. It doesn't hurt that tomorrow is Friday, which is often a good excuse for the bears to book profits and stand aside.

Although there was a very slight late bounce, there was still an ocean of red on the screens. Apple (AAPL) continues its miserable action and there is no positive leadership. The upside action that does exist is primarily just oversold bounces. There are only 24 stocks on the new highs list today, which makes it clear that there are no pockets of momentum.

While I'm a bit more optimistic about the chances of a bounce, that doesn't mean that I'm betting that the market has seen its lows. The likelihood is that any bounce at this point will eventually fail. While we may want to try to trade it, we definitely don't want to trust it.

This is a very tiresome and tedious market. It is very easy to feel frustrated if you are trying too hard to make things happen. The market just isn't offering us much. We need to accept it and keep watching for a shift.

Have a good evening. I'll see you tomorrow.

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