Full-time stock trader. Follow me here and on 12631
Joined Apr 1, 2010
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Midday Update

The market gapped up higher this morning, despite notable weakness in many of the high growth names found in the Nasdaq Composite Index. As a result, the Dow Jones Industrial Average at one point this morning was screaming higher up 100 points, while the Nasdaq has been more or less flat, and is in the red at the time of this writing.

Looking underneath the surface, we have some small caps making nice intraday moves. At the same time, the very narrow pockets of momentum make it difficult to get very aggressive on the long side, as momentum leaders likeĀ BIDU CMG CRM NFLX are all firmly in the red. Just because there are not a bevy of attractive longs, though, does not necessarily mean it is correct to start looking for shorts just yet. As I discussed over the weekend, we could easily be experiencing another one of those low volume “V-shaped” squeezes to new highs.

Hence, a much more selective than usual approach is still advised. A neutral/cautious stance is not the most fun way to trade, but when the market is offering up unfavorable risk/reward setups, I am content to focus on protecting capital above all else. I am playing a few longs, but you can be sure that if we see a failed bounce I’ll be quick to hit the exits.

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