Under Pressure

 | Nov 15, 2012 | 11:22 AM EST
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Once again, the bounce buyers are anxious to catch some upside but they are pressing too hard and as soon as the market falters, they will look to escape, which keeps the pressure on.

The big problem bounce buyers face is a relief rally, which seems painfully obvious, but any upside move is quickly flipped to death. We'll eventually see a better bounce, but it isn't going to happen until the market makes mincemeat out of folks who think it is going to be easy time.

Apple (AAPL) continues to be a major drag as it quickly failed to bounce again. Oil is the best-acting group this morning, which is probably a function of the growing tensions in the Middle East. If you are looking for strength, the best you will find are weak oversold bounces in random names.

I continue to see no reason to build longer-term positions now. I'm dinking around with ProShares Ultra S&P 500 (SSO) just to stay occupied, but I'm not at all confident that this market is close to a bottom. In fact, a bounce may be what sets us up for new lows next week.

Stay focused on protecting capital. Trades should be very short term with tight stops, and if you are anxious to buy for the longer term, make sure you leave plenty of room to average in further.

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