Stocks were hit with selling pressure on the first trading day of the year. A little profit taking after a sharp eleven day advance is pretty normal. While this decline could extend further and retrace a portion of the December surge, I am viewing it as a small correction and expect it to end at or above the next support levels. Elsewhere, I was impressed with the Dollar's surge and the Euro's fall. UUP surged off support and challenged resistance, while the Euro tested support. Oil fell over 3% and the USO Oil Fund (USO) reversed its short-term uptrend. The Gold SPDR (GLD) recouped its support break to set a bear trap, but remains short of a trend-reversing breakout.
**This chart analysis is for educational purposes only, and should not
be construed as a recommendation to buy, sell or sell-short said securities**
**************************************************************
**************************************************************
**************************************************************
**************************************************************
***************************************************************
Key Reports and Events (all times Eastern):
Fri - Jan 03 - 11:00 – Crude Oil Inventories
Fri - Jan 03 - 14:00 - Auto/Truck Sales
Charts of Interest: Tuesday and Thursday
This commentary and charts-of-interest are designed to stimulate thinking. This analysis is
not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise).
We all need to think for ourselves when it comes to trading our own accounts. First, it is
the only way to really learn. Second, we are the only ones responsible for our decisions.
Think of these charts as food for further analysis. Before making a trade, it is important
to have a plan. Plan the trade and trade the plan. Among other things, this includes setting
a trigger level, a target area and a stop-loss level. It is also important to plan for three
possible price movements: advance, decline or sideways. Have a plan for all three scenarios
BEFORE making the trade. Consider possible holding times. And finally, look at overall market
conditions and sector/industry performance.
