One trading strategy that has worked well so far in 2012 is to short a big gap-up open. This is the fourth time the bulls were quickly shot down after a big start. On the other hand, buying a gap-down open has also worked well, as the dip-buyers have been steady -- but that is not today's business.
Economic reports are the obvious culprit this morning. The Case-Shiller housing numbers were weaker than expected, as were both the Chicago PMI and consumer confidence reports.
Earnings are a mixed bag, with no major standouts, but strength in Apple (AAPL), Google (GOOG) and a few other "window dressing" candidates is helping to hold up the Nasdaq 100 in particular. Breadth is positive on the NYSE but flat on the Nasdaq, with precious metals and chips leading while oil and coal lags.
As I mentioned in my opening post, I don't have a whole lot on my radar right now. I'm playing some of the rare earth names like Rare Element Resources (REE) and Quest Rare Minerals (QRM) on comments from analysts that they expect prices to remain high.
We'll see if they dip-buyers step up again, but he issue lately is that even though they do provide support, their ability to gain further traction is limited. That isn't bad, but it results in shorter, faster trades for small gains.