Market Timing and Daily Update

Markets were rather dull and listless yesterday.  Even volumes have been below average.  Alcoa (AA) kicks off earnings season and reported disappointing earnings yesterday after the market close.  Initially, both the stock and the futures sold off in the pre-market, but now the stock is back to unchanged and the futures are slightly positive.  It may be that the expectations of poor earnings for this quarter are already discounted into the market.   Given this assumption, companies that beat earnings estimates may respond very favourably and gap up like Research in Motion (RIMM, RIM.TO).  Other news that could have an impact the market include the new short sales rules that are coming out of the US Securities and Exchange Commission (SEC) and the results of the “stress testing” on the US banks.  Oil has sold off prior to the oil inventory reports and now sits at around $48.  Gold and silver continue to inch back up after the Monday selloff. 

While it is appealing to pick a bottom, there is still plenty of time to get back into the equity market and reap returns.  In the meantime, we remain in a bottoming market and will continue to monitor the scans to look for opportunities. 

 As of this writing, futures are marginally positive and the DAX is positive, indicating a positive open.    The market condition scans remain neutral, giving no indication on short term market direction.   The market bias indicators are neutral.  This suggests a choppy indecisive day, which is not the best for trading.

Index	Change	%Change	Level	Phase
TSX	-191.42	-2.12%	8824.75	Recovery
DJIA	-186.29	-2.34%	7789.56	Recovery
Nasdaq	-45.10	-2.81%	1561.61	Recovery
SP 500	-19.93	-2.39%	815.55	Recovery
Russell 2000	-15.89	-3.55%	431.70	Recovery
NYSE	-128.81	-2.45%	5120.67	Recovery

Source: Telechart

Short Term market outlook:

Bias: Scans showing a neutral bias

Energy: moderate

 Primary Trend: Remains down to sideways

Sector	Phase
Consumer Staples	Bearish
Healthcare	Bearish
Technology	Recovery
Utilities	Bearish
Energy	Bearish
Financials	Recovery
Industrials	Bearish
Materials	Recovery
Consumer Discretionary	Recovery

Source: Telechart