Tuesday, December 06, 2011

Indecisive market

The stock market was rather indecisive today. The Dow was up a little, but NASDAQ was down a little. Some stocks were up, while others were down. Some of the uneven action was due to some of the less-hot issues catching up, coupled with some of the hotter issues being hit by a little profit-taking as antsy traders and short-term speculators lost patience with the slowed pace of the rally. The market remains in a elongated "moment of truth", as market participants try to discern whether to maintain "risk on" or flip to "risk off."
 
Some of this bated-breath  indecisiveness is people waiting to find out the outcome of the upcoming EU summit on Thursday and Friday. It's difficult to say whether the market will "rally in relief" if the summit is successful or "correct in disappointment" that the summit didn't meet the more wildly misguided expectations of some euro critics. We could see some defensive profit-taking before the meeting. And we could some some volatile trading after the meeting on Friday. Plus we have the usual issue of speculators closing positions in advance of a weekend. In this case, speculators may choose to close positions before the EU summit and weekend combined.

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