What's particularly unusual about the market right now is that only one issue matters. Nothing other than the fiscal cliff deal is of any consequence, which makes the action highly sensitive to every little bit of news, every rumor and even uninformed speculation. The market just spiked to the session high on the latest press conference by House Speaker John Boehner, and now we wait to see what the Democratic reaction will be. If it is positive, the indices will likely go higher again.
The vast majority of traders are trying to time when this fiscal-cliff deal will be done. Many just want to catch a quick move, and many others anticipate that it will be good sell-the-news short opportunity. They are all engaged in trying to guess exactly when the next piece of new will hit.
The market is obviously optimistic that a deal will be done, despite what the folks in the media have to say. The challenge is that, the more the market anticipates a deal, the less likely we'll see additional upside or additional momentum from news of the deal itself.
At this point I believe we will see a good-sized move if a deal is made, and the market is acting as though it agrees with that assessment. I'm trying to add some long exposure, but I continue to have a hard time being very aggressive. I bought some U.S. Silica (SLCA), Cheniere Energy (LNG), JinkoSolar (JKS) and a couple others today, but I still have substantial cash I'd like to put to work. Maybe I'm being too selective, but I'm just not finding very many inviting individual charts.
The market is ramping now as other folks with cash like me are trying to put it to work.