Market players are having some doubts this morning. They are thinking, "Maybe these guys really are stupid and too stubborn to do a deal." A headline that President Obama would veto the Boehner deal isn't helping. The market is still holding up quite well but the wild optimism has cooled off and a little profit-taking is kicking in. Apple AAPL is a good example of what is going on out there as it pulls back after a good run.
I'm dealing with this by tightening up stops and protecting recent gains. I still think we will see a fiscal cliff deal but that doesn't justify being undisciplined with money management. It is more important to deal with the action in front of us rather than hope for some news scenario to play out.
Aside from the focus on the headline news, it isn't bad at all technically for the market to rest a bit after the recent run. We need to let the flippers exit and for new setups to develop. Most of the stocks I like are becoming extended now, and I'm not inclined to chase anything. A good example is my recent stock of the week, Security National Financial SNFCA, which continues to trend upward quite strongly.
One small biotechnology stock on my radar this morning is Sequenom SQNM, which is looking to test its overhead at $5. Solar stocks continue to perform well and I will likely add to a position in JinkoSolar Holding JKS on some weakness.
