It took a while but the market has finally managed a bounce. A new recent low caused panic in Apple (AAPL) first, but news that our esteemed leaders in Washington are optimistic about a fiscal cliff deal ran the action up. There aren't any details yet, and it really isn't surprising that the politicians are sounding positive, but it is a good excuse to trigger buying after the recent carnage.
The biggest problem is that so many traders have been looking for a bounce for so long that there is likely to be plenty of flipping for quick gains. It will be nice to ring the register for a change after the miserable action we've seen lately.
We are already rolling back over as I write, which is likely to trigger even more flipping. What we need is enough strength for folks on the sidelines to feel like they are going to be left behind if they don't hurry and put money to work. So far, that is not happening and may not in front of the weekend.
One additional problem for technical traders is that there aren't any good chart setups. We have plenty of oversold stocks with support at key moving averages, but there are no bases and no upside momentum. If you are buying, you have little choice but to buy broken charts.
I was stopped into AAPL at $525.25 and I'm likely to put more money to work in anticipation that it will build on this bounce next week, but I'm not seeing much to be excited about. Thanksgiving week often has a positive bias so I'm a bit more optimistic but, as I keep reminding you, a bounce doesn't mean a bottom.
This market still has major problems and long buys are for the purposes of quick trades.