Trading-range action continues, but it is the bears turn to have a slight edge today. Breadth is running 2,500 gainers to 3,800 losers and there are only 78 new 12-month highs -- but we are off the opening lows. The intraday pattern lately has been for an early bounce and afternoon weakness. As I mentioned yesterday, the S&P 500 has not closed at its intraday highs so far in the month of October.
Rather than spend time on the indices that are stuck like glue in a trading range, the productive thing to do is focus on individual stock picking. We have movement in names like PayPal (PYPL) , Microsoft (MSFT) and Time Warner (TWX) that is giving the action a more positive feel. Small-caps have also found some support and are gaining a little momentum, but the iShares Russell 2000 ETF (IWM) -- a holding of the Stocks Under $10 portfolio -- is still in precarious shape, technically.
Facebook (FB) is my top big-cap holding -- and the Action Alerts PLUS holding continues to look fine. Recent picks Emerge Energy (EMES) and Mimecast (MIME) are hitting new highs. I added thinly traded CyberOptics (CYBE) this morning.
Many traders are focused on Twilio (TWLO) today, following a secondary offering priced at $40. Secondary offerings have not done particularly well lately. For example, Acacia Communications (ACIA) was a huge winner earlier in the year, but it failed to hold pricing at $100 a couple of weeks ago -- even after an increase in earnings estimates. There are a number of others that have traded like that recently, but traders seem to be optimistic that TWLO is priced low enough to offer a good opportunity. I have a small position, and am looking for higher highs to signal adequate support.
I'm still holding very high levels of cash, and have been content in trying to pick off a few trades here and there. Until market conditions change, there just isn't any opportunity to be highly aggressive.