Planet Wealth

The market followed the lead of the futures and opened lower this morning.  The economic news of the morning was the jobless claims coming in with a loss of 505,000 which was the expectation.  Some were hoping for a drop in the 400,000 range, but that in itself would not account for the lower open.  The LEI (leading economic indicators which forecasts expectations 6 months out) showed an increase of .3%, however an increase of .5% was expected.  That was a little disappointing and when coupled with a higher dollar may be one of the factors for the lower early trade.  The big drop was right on the open though and one thing to remember is that Friday is options expiration and volatility is the norm during expiration weeks.  The volatility used to be on Friday, although I've noticed recently that traders have tended to make their moves on Wednesday or Thursday in recent months.  There isn't big volume, at least not yet and the market is trading right at it's 10 day mva as I write this.  No major reason for concern yet if you are bullish, but this drop certainly is worth watching.  Another factor could also be that Geithner is testifying in front of congress and traders are always hesitant to go long when he speaks.  The close may tell us if this is another good buying opportunity or the start of something more worrisome.  The market held nicely above that 1100 level for the past two days, so to see it give up that level is another issue to pay attention to.  Is it a headfake to shake out the weak longs?  The clsoe should tell us more.  Therefore, we may actually wait until Monday before adding positions, I'll keep you posted.  Sometimes, patience is the best trade!