12:30pm (EST)
We were slightly skeptical of the pop above the 200-Day Moving Averages on Friday and said it would be important for the bulls to hold short-term support this morning. So far, they have although the S&P is struggling to hold 1,400. We also mentioned last week that this week was showing a possible continuation of higher prices but that Monday and Friday could be negative.
As expected, the talking heads are praising the Black Friday sales and are pumping up Cyber Monday but have thrown the Fiscal Cliff bone for the bears to chew on. There is water-cooler talk the Republicans are “hinting” that they may accept some revenue increases but that has been expected. No sound bites from the Democrats yet but the head zombie has made it clear he wants tax increases.
Economic news has been light today with the Dallas Fed Manufacturing Index coming in below expectations. The index fell to -2.8 in November from October’s print of 1.8. We mentioned this morning there were a few regional reports to watch this week but much of the focus will be on the zombies.
As far as the indexes, the Dow is down 89 points to 12,920 but tested 12,900 shortly before Wall Street’s lunch break. The S&P is lower by 9 points to 1,400 but has kissed 1,397 while the Nasdaq is declining 6 points to 2,961. Tech has held 2,950 and that is a good sign for the bulls despite today’s overall pullback.
We are getting a little pin action to start the week as our current trades continue their setups. We have a nice mixture of calls and puts that extend into December and January and we are excited about all of them. Subscribers, check the Members Area to get our latest thoughts.