Thursday, May 31, 2012

Market Commentary for May 31, 2012

The U.S. stock indices had a brutal day to the downside on Wednesday with the S&P 500 finishing down 19 points (-1.43%) to close at 1313.32.  This decline wiped out the entire gains of Tuesday when U.S. markets rallied strong coming off the Memorial holiday weekend.

As I mentioned on Tuesday, with the jobs report coming out tomorrow, sovereign debt woes from Greece and Spain dominating the news, and with the S&P 500 sitting inside a bear flag, this is a week for short term trades only.  It's not a time to put on big directional bets.

From Tuesday's setups list,  ARNA triggered over $6.09 from the tiny cup with handle formation.  That position was exited yesterday for a 4% gain, although it finished the day strong, so I may reenter today for a day trade.  The stock is jumpy, trades very active, and has a decision pending for an obesity drug from the FDA in mid June.

Yesterday after early morning weakness, gold reversed back up.  I took NUGT at $10.28 and still have that position.  Gold recently bounced off support in the 1525 area, and short term I think it can get back to the mid 1600s as there's a lot of bearish sentiment.

                         Click on charts to enlarge:


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