The Market Couldn't Deliver Three up DaysBy David Peltier
| Dec 19, 2011
| 4:19 PM EST
The major U.S. market averages could not make it three winning sessions in a row. Folks were quick to sell when reports started trickling out of Europe that plans to stem the debt crisis were not making progress. Traders faded a solid open and each of the major domestic averages closed down at least 1%.
Elsewhere, the dollar rallied throughout the day. Gold prices also slid, while crude oil recovered a fraction of last week's losses. The yield on the 10-year treasury note hit 1.8%, which is the lowest level since early October.
Materials and Financial stocks led the way lower on Monday. Most notably, Bank of America (BAC:NYSE) dropped below $5 for the first time since 2009.
Other losers included Eldorado Gold (EGO), which fell 14%. Investors took the name down to a new 52-week low, after the company announced a $2.4 billion acquisition. The standout winner of the session was Winn-Dixie (WINN:Nasdaq); which gained 70%, as the grocery retailer received a cash takeover bid.
Looking ahead to Thursday, General Mills (GIS:NYSE) and Carnival (CCL:NYSE) highlight the earnings calendar, while CVS Caremark (CVS:NYSE) hosts an analyst meeting. We'll also get a look at November housing starts and permits before the opening bell.
Position: none
The S&P Hits a Retracement LevelBy Scott Redler
| Dec 19, 2011
| 4:02 PM EST
When stocks break down before the market, it's never a good sign for overall environment.
That means buy programs buy the S&P 500 stocks, but Institutions sell stocks into those programs (creating relative weakness in stocks).
Combine that with the intraday reversal we outlined last Tuesday, and participants had the opportunity to lighten up or get short! Once the buy program's stop, the market caves in!
The S&P is now right at the 61.8% retracement level that we've outlined a few times in the last few sessions --$120-$120.30 in the S&P 500 Trust (SPY). A close under this opens up the door for $119.61 SPY, then the gap from Nov. 28 at $118.82. The Friday pivot we closed on from Thanksgiving is $116.20.
If everyone thinks this is light volume, Imagine if the smart guys in Washington try and pass a transaction tax.
www.realmoney.thestreet.com/updates-and-conversations
A.L. Wenn die bärisch werden, geht es meist rauf.
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