Online Stock Trading | Stocks Rise on Lighter Trade

Stocks Rise on Lighter Trade


Filed Under Market Commentary |

4:35pmEST Stocks end the day higher with broken leaders continuing to lead this market, but volume continues to slide.

The NASDAQ continued gains from Friday on the back of AAPL and RIMM gains. Volume continues to disappoint as these former leaders come off their lows on lower volume. Accumulation continues to elude this market, we continue to lack the necessary leaders in this market. The current market environment will suck in retail traders as well as bottom feeders. In the end, it will only end badly for those who choose to take AAPL, RIMM, GOOG, and BIDU for a long trade.

The best course of action is to move away from stocks and sit on the sidelines until the stock market conditions improve. What the market is giving us for risk/reward is not ideal for great returns.

I find the news out of AIG troubling. Due to CDO (Collateral Debt Obligations) exposure AIG wrote down 3x the amount that was originally announced. What can we deduce out of this? There are more writedowns out there to be had. Tied to the writedowns will be ABK and MBI who rated the majority of CDO deals. ABK and MBI’s price actions are foreshadowing that we are going to see another leg down in these stocks.

Be weary of the current market action. Trade it safely by ignoring stocks for the time being.

Market Speculator

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