Despite dueling politicians with no solutions, the market managed to close on a positive note today. Market players are ignoring the rhetoric and they remain optimistic that a fiscal-cliff deal will be done. Whether they still feel as sanguine 24 hours from now remains to be seen. But for now, there is a high level of trust in our political leaders.
Even though there's a generally positive bias, it continues to be a tough market to trade. Volume is slowing as the holidays approach and there is a lot of very flat and random action. There are a few pockets of momentum, but they are limited and the risk of quick reversals is high.
I'm sure I'm not the only trader worn out from waiting for this fiscal-cliff debate to clarify. I feel like we have been handcuffed for weeks, and I'm sure many traders want to shut down and enjoy the holiday already. Of course, the big risk is that a deal could come at any minute and you can bet there'll be a sharp spike.
There is OK action, but it is tough to embrace until the news flow shifts. It could easily drag out for another week, which would make for miserable trading during Christmas week, but I'm betting on clarity sooner rather than later.
Have a good evening. I'll see you tomorrow.