Trading on News

 | Nov 28, 2012 | 10:43 AM EST
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There is an old saying that the market hates uncertainty, and that certainly seems to be the case today. Unfortunately, this is likely to last for a while as the fiscal-cliff debate continues. There are going to be optimistic statements that will bounce the market, but there will be negative comments as well, like Erskine Bowles , who said this morning that he thinks there is only a 1-in-3 chance of a deal.

Weak housing news isn't helping matters and, of course, the technical pattern suggests more backing-and-filling is needed. The SPDR S&P 500 (SPY) has not filled the gap that was formed last Friday morning in a euphoric half-day of trading, but the market is still above the key 200-day simple moving average. It hasn't completely rolled over, but it is close and needs some sort of bounce or support soon.

I've moved to a very heavy cash position and I see very little I'm interested in buying other than an intraday flip.

We should have comments from President Obama later today, and that is going to determine our short-term fate. If he takes too hard a stand, it may be a problem, but if there are signs of flexibility, the market has the potential for a decent bounce.

Trading off news events isn't what I like to do, but there's no real choice.

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