The Market Is Trapped

Earnings season starts in a week, but mega cap tech earnings are still a few weeks away. That is the next catalyst.

PRE-OPEN MARKET COMMENTS THURSDAY - The market is stuck in a horizontal trading range and the momentum has stalled. The major moving averages are catching up and we are testing the 50-day MA regularly. A wedge pattern has formed in the middle of the range and prices are compressing. Neither side has control and the price action is dominated by programs. Normally, 60% of the daily activity is program driven. When the volume dries up like this it is closer to 75%. It is foolish to compete with programs that randomly probe the bid and ask in search of size. They reverse in an instant and you will drive yourself crazy trying to predict the price action.

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