Summer Doldrums Are Setting In – Expect Quiet Trading Today

Posted 9:40 AM ET - Yesterday the market found support and it drifted back above SPY $215.75. We are now back in the trading range and Tuesday's decline was a one-day event. Trading volumes are extremely light and the summer doldrums have set in. ADP came in at 179,000 and that was perfect. ISM services was a little light but it didn't have much of a market impact. Tomorrow's jobs report should come in around 180,000. That would be strong enough to suggest sluggish growth and soft enough to keep the Fed on the sidelines in September. August and September are historically weak months. Politicians and bankers are on holiday and investors often get nervous. I expect to see a light round of profit-taking this month. The move will be choppy and it won't last long. After tomorrow we will head into a news vacuum. Wednesday we were able to find some nice stocks that trended throughout the day. Good entry is critical to day trading. Once the momentum stalls, take profits. You won't have a market tailwind helping the stock. Biotech and small caps presented some nice opportunities yesterday and we will see if we can find similar today. I am very gradually building a position in BZQ and VXX. I am early and I'm expecting to see some nervous jitters as the month unfolds. I also know I might take a little heat on the position. Keep overnight exposure to a minimum and focus on day trades. . .

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