Did anyone really think the market wouldn't see some dips on fiscal cliff worries? Senator Harry Reid did the honors today with comments about how there has been little progress, but he added that he is confident that the Republicans will eventually see that the only correct course of action is to agree with him, so he isn't too worried.
You can be sure we will have plenty of market-moving headlines in the days ahead. The market is going to be held hostage by these negotiations, and while I'm confident that there will eventually be a positive resolution, there is likely to be a high degree of volatility while we wait.
Another issue that will keep things choppy is anticipation of the tax-law changes coming in 2013. We are already seeing some special dividends, and many market players attributed the vicious selling in Apple (AAPL) to a rush to take capital gains before the rates went up. That is going to be a theme to watch for in other names that have had significant advances in the last couple of years.
The bottom line is it's a traders market. There are some opportunities in individual stocks, but we can't trust momentum will be sustained and we have to keep time frames short. If you stay selective and disciplined, you should be able to bank some coin while waiting for the politicians to move out of the way.
Have a good evening. I'll see you tomorrow.
